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ASSIGNMENT

ICON COLLEGE OF TECHNOLOGY AND MANAGEMENT

Course: BTEC Level 7 Advanced professional Diploma in Management Studies Unit 4 : Strategic Planning and Implementation

Name of the student : MD. RAKIBUL ISLAM Student ID : 5776

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ABSTRACT This assignment will allow us to have idea about management strategy ,developing vision , mission , objectives. Also have idea about plan for implementation of the strategy.

MC BRIDE PLC. PART 1 A Company profile:

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McBride is by far the largest provider of Private Label Household and Personal Care products to Europes largest and most successful retailers. Our 19 factories in seven countries across Europe supply over 90% of the top 30 retailers. Mission: To be the pre-eminent and most efficient supplier of consistent quality household and personal care products to the leading retailers and brand owners. STRATEGY Strategy for growth - organic To lead the growth of private label household and personal care products in Europe Commercial Leadership - focus on attractive product categories : auto-dishwash, specialist cleaners, liquid detergents, air care and personal care - innovation : development of new and existing products - work with discount retailers - reinforcing category development skills Operational Leadership - optimise customer service - continuous improvement - further drive asset utilisation Strategy for growth acquisition Focus on attractive product categories : auto-dishwash, specialist cleaners, liquid detergents, air care and personal care Increase exposure to growing discount distribution channel Reduce dependency on UK and France household Strategic and in-fill opportunities Leverage established business model and systems Consolidation opportunity Attractive returns available McBride Plc. strategy is to continue to focus on building scale positions in our priority product markets. This will allow the Group to further improve efficiencies and unit costs, in order to deliver even better value and performance in our product offerings. Enhancing scale ultimately brings substantial benefits to all our stakeholders including: Strengthening customer and supplier partnerships Leveraging greater purchasing power for the benefit of customers and shareholders Delivering outstanding value products to customers and consumers Offering enhanced and more varied careers for employees
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Increasing resources focused on improving sustainability

GOALS AND OBJECTIVES We believe we can always improve efficiency and follow a culture of continuous improvement. Benchmarking and sharing of operational performance data across the Group means we are always improving the returns from our asset base by increasing output or reducing downtime and costs. We share data on blow moulding performance, filling line effectiveness, supplier service and New Product Development to maximise efficiency. Where possible we use similar machinery in our factories and common packaging formats, caps and triggers to provide flexibility across the Group. We are introducing new standard operating procedures across the Group based on Lean principles. During the year we have closed two factories in the UK and integrated their production into our larger facilities such as Middleton, Burnley and the St Helens factory which we acquired in 2008 to maintain a competitive and efficient cost base.

STAKEHOLDER institutional holders. Shareholder Invesco Perpetual Aberdeen Asset Management Allianz Global Investors Aviva Investors Legal & General Investment Management SEB Asset Management Number of Shares 30,525,589 21,636,216 10,819,464 9,056,131 8,102,326 5,914,929 % 16.9 12.0 6.0 5.0 4.5 3.3

1B Principal activity
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The Groups principal activity is the production, distribution and sale of Private Label Household and Personal Care products to leading retailers in the UK and Continental Europe. The Board expects the Group to continue focusing on the current core business and main product categories in which it currently operates. Sector Private label household and care products providing to Europes leading retailers. Top retailers include

Supplying Europe's retailers

Europe's leading retailers are continuing to expand their Private Label offers and develop in the growing markets of Central and Eastern Europe and beyond. McBride Plc. Is well positioned to support them realise their growth objectives.
McBride supplies over 90% of Europe's leading retailers as ranked by planetretail.net

Rank

Retailer

Retailers banner sales 2008 m

Retailers home market

Carrefour

67,428

France

Tesco

49,705

UK

Schwarz Group

47,030

Germany

Metro Group

41,292

Germany

Rewe Group

36,280

Germany

Auchan

35,347

France

Aldi

32,361

Germany

Edeka

29,941

Germany

E Leclerc

26,955

France

10

ITM (Intermarche)

23,801

France

11

Casino

23,489

France

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Ahold

22,782

Netherlands

13

Sainsbury

20,063

UK

14

Wal-Mart

19,440

USA/UK

15

Morrisons

15,791

UK

16

Systeme U

14,234

France

17

El Corte Ingles

12,911

Spain

18

Mercadona

12,262

Spain

19

Lekkerland

10,475

Germany

20

Coop Italia

10,190

Italy

21

Marks & Spencer

9,837

UK

22

Migros

9,518

Switzerland

23

Louis Delhaize

9,148

Belgium

24

Tenglemann

8,520

Germany

25

Coop (CH)

8,156

Switzerland

26

Co-operative Group

7,922

UK

27

AS Watson

7,849

Hong Kong

28

Alliance Boots

7,776

UK

29

Musgrave

7,738

Ireland

30

John Lewis Partnership

7,358

UK

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Product or service offering

Household cleaning products

We have one of the most comprehensive ranges of Household cleaning products, from air fresheners to zeolite-based washing powders: the A to Z of cleaning. The main Household categories we manufacture include:

Laundry products Dishwashing products Household cleaners Toilet cleaners Air care products

Personal Care products McBride has an extensive range of personal care and toiletry products. We are expanding our offer all the time. With four Personal Care liquids factories - in the UK, Belgium and Poland - as well as 2 Personal Care aerosol factories in the UK and France, we provide European scale in this dynamic market. The Personal Care categories we manufacture include:

Baby care Bath and shower products Hair care Body care Mens grooming Oral care Skin care

Operational performance Private Label has been gaining ground not just in the UK but throughout Europe. In McBrides sectors of Household products in the UK, Private Label sales in the year to June 2009 grew by 5.4%, over two times faster than those of branded products which grew by 2.4% in the same period. In Italy, the performance of Private Label was even better with sales growth of 5.5% compared with branded sales up just 1.2%. In France, TNS offers (TNS) reported Private Label reached over 23% market share by value, with sales up 1% compared to branded sales which declined 2.4%. In Germany, Private Label share of the Household cleaning and
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laundry products reached 33.0% value share (2008:32.6%) in the year to March 2009 with volume share at 43.0% (2008: 42.5%).

PART 2 Q1. Analysis of the external and internal environment of MC BRIDE PLC and competitive position of the company ANS An integrated understanding of the external and internal environment is essential for firms to understand present and predict future. Firms external environment is divided into six different segments. They are Political Economical Socio cultural Technological Environmental Legal factors Firms dont have control on the segments of the environment and they need to gather information required to understand each segment for the implementation of their strategy. Most firms face external environments that are highly turbulent , complex and global conditions that make interpreting those environments increasingly difficult. MC BRIDE PLC IS THE largest provider of Private Label Household and Personal Care products to Europes largest and most successful retailers External environment can be analysed by PESTEL analysis

These are the factors that indicate the external environment situation of the company

Political factors may include

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Stability of government Taxation policy Regulation of foreign trade Social welfare policies

Economic factors may include Economic factors may include

Business cycle Trends of GNP Interest rate Money supply Inflation Unemployment Disposable income

Socio cultural factors may include

Population demographics Distribution of income Social mobility Lifestyle change Consumerism

Technological factors may include

Government spending on research
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Industry focus on technology New discoveries Speed of technology transfer

Environmental factors may include

Laws for environmental protection Waste disposal Consumption of energy

Legal factors may include

Competition law employment law product safety

The external environment always throws opportunities and threats to the company . And researching the external environment provides the following opportunities and threats to the McBride Plc.

OPPORTUNITIES In a recent study by the Institute of Grocery Distribution (IGD) undertaken in April 2009, a survey of shoppers regarding their buying habits reported that 33% were intending to purchase more Private Label products in the future, while only 4% of consumers questioned said they were intending to buy more branded products.
first company to achieve Charter status by AISE (the International Association for

Soaps, Detergents and Maintenance Products).

McBride Plc. the clear leader in Household and Personal Care products. In fact McBridePlc. over twice the size of our nearest rival.

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11 MC BRIDE is the Leading supplier of FMCG products in growing private label

segment.
MC BRIDE HAS 18 factories in 7 countries and China sourcing office

24% return on capital employed In the year ended July 2009, 41% of all grocery sales in the UK were Private Label compared to 38% to July 2008 according to Datamonitor. As part of their weekly shop 31 million consumers in the UK were now buying Private Label.

THREATS Acquisition integration The scale of the recent and possible future acquisition activities gives rise to risk for the Group in a number of ways including the potential for lost focus on the core business and the potential for adverse impact on customer service levels during factory integration together with the potential risk of skills shortages as existing people become increasingly stretched. To mitigate this risk integration teams are established under the leadership of experienced managers to review the issues in depth and develop detailed project plans. Additional resources are hired to backfill gaps in the existing business; generally, these are interim resources to allow cost to be incurred for the minimum period of time. As acquisition activity increases the risk arises of items materialising which could not be identified or quantified during due diligence activities. To mitigate this risk, where due diligence cannot provide the necessary degree of assurance, specific representations and warranties are sought from the vendor. Where uncertainty exists, earn-outs can provide a final degree of protection

People risks The main people risks are the loss of key managers, insufficient planning for management and Board succession, as well as the risk of industrial relations breakdown or strike; all of these could adversely impact on the Groups reputation as well as leading to employee morale problems. Well established procedures are in place covering consultation, employee involvement, works councils, documented grievance and dispute resolution procedures and focus on engendering a culture of consultation. Employee morale is measured annually through the Employee Opinion Survey and mitigating actions taken when required. The latest survey results show an improvement in Employee morale. In addition, the Group has a wellestablished process for talent management and succession planning for senior employees. Succession planning for executive management is actively considered by the Nomination Committee and the Board. Where employees have access to sensitive data, appropriate measures are in place to prevent its disclosure should an employee leave the Group.
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Operational disruption Given the short lead times and demanding service levels required by customers, disruption to McBrides manufacturing or distribution facilities (for example, by fire, health and safety failure, problems of supply, information systems failure, workforce action or environmental incident) could adversely affect the Groups performance. Whilst the Group maintains insurance based on levels that it believes are appropriate for its industry, some of these operational risks could result in losses and liabilities in excess of its insurance coverage or in uninsured losses and liabilities. This risk is managed through well-established processes including standard operating procedures, asset maintenance, regulatory compliance, dedicated steering groups, monitoring, auditing, consultation, multiple sourcing and disaster recovery plans for manufacturing and distribution facilities. Supplier failure The Group depends on close trading relationships with a number of key suppliers across Europe. McBride Plc. have established a procedure or identifying the possible risks for each key material, ensured we have pre-qualified alternative suppliers wherever possible and where this is not possible we retain higher levels of safety stocks. McBride Plc. also review suppliers own contingency plans and strive for reformulations of products where appropriate. Environmental risks The amount of environmental legislation has grown tremendously in recent times. In addition, environmental issues are increasingly driving consumer and retailer behaviour. These emerging trends may give rise to the Group having to evolve its operations more quickly than might otherwise have been the case, presenting risks as well as potential opportunities. The Group is also exposed to risks of liabilities inherent in the context of the long established nature of its operations, including the cost of required remedial action. These also include the potential cost of complying with additional future regulation including changes in production practices and the risk of being subject to claims for personal injury as a result of alleged exposure to hazardous materials or other environmental conditions. The Group is committed to minimising the environmental impact of its operations. To support its performance in these areas, the Group maintains appropriate robust performance management systems and key performance indicators. It also has strong focus on achieving exacting external accreditation for its operations. Environmental audits have been undertaken of all key locations. Any issues have been identified and appropriate actions are taken in accordance with local legislative and regulatory guidelines. These include consideration of any potential impact on both employees as well as neighbouring properties and any potential public health issues. The Corporate Social Responsibility report on pages 26 to 28 and the separate Sustainability Report published on the Groups website at www.mcbride.co.uk provide more information on the Groups approach to Environmental, Social and Governance (ESG) matters. Product safety and quality

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The Household and Personal Care products sectors have various product and ingredient issues relating to concerns voiced over the long-term effects of household chemicals on human health and the environment. Failures in product quality controls, the risk of despatch of unsafe product or contravention of labelling regulations and other legislative requirements could lead to damage to the reputation of, and trust in, McBride and adversely affect the Groups business. The Group has comprehensive management processes in place to ensure that its products are both suitable and safe for their intended use. Additionally, regulatory compliance and product safety issues are actively addressed through membership of relevant industry associations. The Group has established product development and quality management processes to minimise the risk of such failures arising, including a dedicated quality assurance function. Product quality controls include the use of in-house toxicologists supported by independent third party specialists. In addition, detailed product recall and crisis management procedures are in place and are regularly reviewed. As part of McBrides commitment to continuously improve the safety and environmental sustainability of its products and processes, it has a number of programmes, above and beyond regulatory requirements, to systematically remove specific ingredients from product formulae and packaging specifications. Liquidity and capital resources In the current global financial crisis and uncertain economic environment, certain external risks may increase. If there is an extended period of constraint in the liquidity of the debt markets this may impact our ability to maintain our long-term investment programme and may therefore impact shareholder returns. McBride Plc. current banking facilities expire in 2011 and will need to be renegotiated in 2010. It is unlikely we will continue to enjoy the current agreed rates. Decreases in the funded levels of our UK defined benefit pension plan may also increase our pension funding requirements, although the proportion of employees on defined benefit schemes is only 6%. The Group has established a financial framework to ensure thatit is able to maintain an appropriate level of liquidity and financial capacity and to constrain the level of assessed capital at risk for the purposes of positions taken in financial instruments. Failure to operate within our financial framework could lead to the Group becoming financially distressed leading to a loss of shareholders value. Commercial credit risk is measured and controlled to determine the Groups total credit risk. Inability to determine adequately our credit exposure could lead to financial loss. A credit crisis affecting banks and other sectors of the economy could impact the ability of counterparties to meet their financial obligations to the Group. It could also affect our ability to raise capital to fund growth. Foreign currency risk The Group operates in many European countries but reports its results in Sterling and it is therefore exposed to the impact of fluctuations in prevailing exchange rates on items denominated in other currencies, primarily the Euro. The recent strengthening of the Euro has impacted the Groups results in a number of ways. In particular, reported consolidated net debt has increased due not just to the effect of the strengthening of the Euro on Eurodenominated debt but also to payments resulting from this strength under hedges to
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protect the sterling value of the net assets of non-UK subsidiaries. Conversely, we have benefited from the impact of a stronger Euro on the Groups revenues and operating profits which arise in the Euro area. Significant foreign currency exposures are regularly reviewed by our Group Treasury Committee, and subject to hedging in accordance with approved treasury policies. Nevertheless, the Group could be impacted in future by significant exchange rate fluctuations.

COMPETITIVE POSITION OF THE COMPANY

1200
Annual revenue (m)

1000 800 600 400 200 0

NO PA Va nd ep ut te Ni ch ol W s itt ol Do m al In qu ib a M cB rid e Pr op ac k Bu de lp ac k M ib el le Bo dy ca re Th ur n Dr ec o Je ye s Ro va l

McBride

Others PL/ Contract revenue

FIG: Competitive position of MC BRIDE PLC.

Q2. Identification and evaluation of alternative strategies that would consist of corporate goals and objectives and select an appropriate future strategy.

Ans :
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To identify various strategies Ansoff matrix is a very useful tool.

The Ansoff Growth matrix is a tool that helps businesses decide their product and market growth strategy. Ansoffs product/market growth matrix suggests that a business attempts to grow depend on whether it markets new or existing products in new or existing markets.

Fig. Ansoff Matrix

The output from the Ansoff product/market matrix is a series of suggested growth strategies that set the direction for the business strategy. These are described below: Market penetration Market penetration is the name given to a growth strategy where the business focuses on selling existing products into existing markets.

Market development Market development is the name given to a growth strategy where the business seeks to sell its existing products into new markets. Product development

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Product development is the name given to a growth strategy where a business aims to introduce new products into existing markets. This strategy may require the development of new competencies and requires the business to develop modified products which can appeal to existing markets. Diversification Diversification is the name given to the growth strategy where a business markets new products in new markets. This is an inherently more risk strategy because the business is moving into markets in which it has little or no experience. For a business to adopt a diversification strategy, therefore, it must have a clear idea about what it expects to gain from the strategy and an honest assessment of the risks.

So depending on the Ansoff matrix various strategies are suggested for McBride Plc.

Market penetration Strategy Mc Bride Plc. Can Maintain or increase the market share of current products this can be achieved by a combination of competitive

pricing strategies: Ofeering cheaper products than the rival companies sales promotion : Various sales promotion could be launched for retailers Secure dominance of growth markets Restructure a mature market by driving out competitors which would require a much more aggressive promotional campaign supported by a pricing strategy designed to make the market unattractive for competitors

Market development Market development is the name given to a growth strategy where the business seeks to sell its existing products into new markets. There are many possible ways of approaching this strategy, including:
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Creating new geographical for example targeting Asian market Creating new product dimension for example focusing on food market, clothing market,

New distribution channels could be another strategy

Product development developing new array of products could be another option . In this case McBride could develop its research and development section modifying existing products

Diversification In this case McBride can develop new products to target a new market. Because different geographical markets will demand for different products

This is an inherently more risk strategy because the business is moving into markets in which it has little or no experience. For this strategy McBride have to asses the new market situation

So among all the strategies Market Development strategy is the most suitable for following reasons As McBrides market is saturated in Europe it is time to seek for new geographic market. Although this is a very aggressive strategy because the company have to assess the new target market but considering the profitable situation of the company it is possible. But the company can experiment on new market if it is thought the target market is too risky. As McBride is the leading producer of private brand household and personal care products it is time to penetrate other product market. This is possible because

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McBride has already created a brand image it is likely to go for new range of products. As McBrides market is saturated in the UK and few other European market it is time to expand their business to all other European countries and for that McBride should create some manufacturing and distribution channels in those countries. Adapting aggregation of the AAA triangle will be helpful in this regard because it stresses on cross border groupings of various sorts.

Q3.Identify and develop outline time table and resources required to implement new strategy. ANS:

Whatever strategy a company have it must have to draw up plans to carry out strategies. To turn strategy into specific implication plans involves four basic elements. Specifying general results expected from strategy Turning general objectives into specific tasks and deadlines Resource allocation and budgeting Monitoring and control procedure

To ans the question we need to consider the third step that is Resource allocation and budgeting.

Resource allocation Resource allocation involves three steps 1. The contribution of proposed resource towards the fulfilment of the organizations mission and objectives. In this case the resource is steered away from poorly performed areas towards the projected objectives.

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2. Its support of key strategies. In many cases the problem with resource allocation is that the request for the fund exceeds the fund that is normally available. So it is better to focus on core objectives and its related required resources. 3. The level of risk associated with a specific proposal. In this case the company needs to check the risk level.

Referance : 1. Exploring coroporate strategy by Johnson et al 2. How strategies really think by Giovanni and Gavetti
3. www.Ft.com 4. www.hemscott.com

5. Annual report McBride Plc. 6. Preliminary announcement McBride Plc

7. www.mcbride.co.uk

8. Strategic management: competitiveness and globalization : concepts & cases

By Michael A. Hitt, R. Duane Ireland, Robert E. Hoskisson

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