Best Snacks, Inc. , a 150-year-old company which has been held publicly for more than 100 years, has traditionally held the number one or two positions in the snack market, providing an excellent and stable investment for stockholders. But in the past several years, Best Snacks sales have been slipping, market share has decreased and, particularly in the past two years, stock prices have taken a dive.
This year, the company will finish a very weak second, and with several smaller competitors emerging as major players in the snack industry, Best Snacks is in danger of losing its long-held premier standing in the snack market,” (University of Phoenix, 2010,2). In addition to these issues, the employees at Best Snacks are unsettled and feeling as if management does not value their opinions and has not done a good job of promoting innovation. In order to succeed, Best Snacks must tackle the challenges of its failing product line as well as find a way to bring the internal climate with employees back to a state of resolution.
Issue and Opportunity Identification
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Best Snacks is facing a number of issues. Declining sales, complacency, and a lack of motivation within the employees due to the absence of manager support have all contributed to the current state. By taking a close look at its competitors and studying other successful organizations the leadership at Best Snacks can retain some of its previous success. Capitalizing on the new changes in leadership, Best Snacks has the opportunity to restructure their organization in a way that will foster an environment of creativity and innovation.
As stated, both sales and market share at Best Snacks has seen a decline. The opportunity presented is for the leadership at Best Snacks to evaluate the organization’s current process to determine how they can keep up with the competition. A radical innovation is a significant change that simultaneously affects both the business model and the technology of a company. Radical innovations usually bring fundamental changes to the competitive environment in an industry, (Davila, Epstien, & Shelton, 2006, p. 51).
Contributing to the declining sales is the fact that there have been no product or service innovations in the past five years; instead, previously successful marketing methods have been improved or extended. Successful organizations tend to become complacent and conservative in order to preserve their core competencies—those things that lead to their success. This is logical and largely advantageous in the short-term. Paradoxically, the things that led to their success could be the very things in the long-term that pull them into failure, (Davila, Epstien, & Shelton, 2006, p. 239).
By designing new marketing methods that are completely different from anything that has been done before, Best snacks can return to their customer base with a fresh approach that will draw people to their products. A learning organization is an organization that purposefully designs and constructs its structure, culture, and strategy so as to enhance and maximize the potential for organizational learning (explorative and exploitative) to take place, (Jones, 2004, p. 377). Currently many employees at Best Snacks do not understand the importance of innovation and have forgotten how to develop and implement creative ideas.
Most of this stems from the fact that managers do not support creativity and innovation, another issues facing Best Snacks. Employees believe that they are not supported in their ideas and independent thinking. One of the key roles of the CEO is to make innovation part of the culture of the company. The CEO needs to make certain that collaboration occurs and becomes part of the culture. Steve Jobs works this critical cultural angle at Apple by being the clear leader of innovation and pushing hard to ensure that there is effective collaboration between the technology and business folks, (Davila, Epstien, & Shelton, 2006, p. 58 & 259). The leadership at Best Snacks should use this opportunity to support and encourage organization learning, developing culture that is ripe for innovation through leading by example and pushing for employees to come up with new ideas.
Stakeholder Perspectives/Ethical Dilemmas
Though Best Snacks is facing a number of issues, three main stakeholder perspectives and ethical dilemmas have been identified. The first is between Best Snacks and the competition. Both Best Snacks and its competing businesses have a vested interest in their individual corporations.
Each would like to be the number one holder of sales and market share in their industry. In their quest to be number one, it is the responsibility of each organization to utilize fair business practices, and conduct themselves with honesty and integrity. Another stakeholder perspective is the leadership of Best Snacks versus their employees. The employees at Best Snacks feel that leadership does not value their opinions and has not created an environment open for innovation and creativity. Though management sees the need for employees to develop a creative mindset, they are unsure about the best ways to utilize those skills.
Both management and the employees need to be honest about what they’re needs and expectations are. Opening the door to communication will allow them to work together as a unit. Management has the responsibility to treat employees with fairness and respect, understanding that although their titles may be lower in rank, their opinions and desire to grow the organization is what will ultimately lead Best Snacks into their next phase of success. The last ethical dilemma that was identified is Best Snacks versus itself.
As a corporation, Best Snacks is rightfully concerned that they are seeing a significant decrease in sales. In their quest to retain success, Best Snacks must be careful to not violate any copyright infringement laws while studying their competition and creating their own new products. Frame the “Right” Problem Best Snacks will become a leader in the snack industry once again by promoting creative and innovative learning within the organization that will inspire a new product lines and allow them to compete with the competition.
Describe the “End-State” Vision
Best Snacks held on to its top position in the snack industry by promoting innovation within their organization. Though the industries may vary, the characteristics of innovative organizations are often similar. Studies have shown that innovative workplaces share six cultural characteristics: context rich, customer close, confidence building, curious, challenging, and collaborative, (Daniels, 2010). Innovative organizations have leaders that cultivate creativity by allowing employees to be themselves and encouraging the development of new ideas.
Brainstorming and team building activities play a large part in how these companies create, (Daniels, Watts-Holley, Mobley, & Rauschenbach, 2010). Capitalizing on these traits, Best Snacks was able to energize their employees and push for organizational learning, and team building that enabled them to create new product lines, modernize the previous products therefore maintaining their previous customer bases as well as capturing a new audience. Identify the Alternatives and Benchmarking Validatio Based on the opportunities given, three main alternatives have been identified.
First, instead of promoting organizational learning, management can select a few employees for individual learning. Managers would select employees to serve on special teams. There’s team members would then go through a series of individual and group learning to implement programs within the organization. Another alternative is for previous marketing methods to be revisited in an effort to appeal to the standard customer base. Leadership at Best Snacks can attempt to capture their previous success by reconnecting with their audience through an analysis of what has worked in the past.
The third alternative identified is to make no radical changes, choosing to stick with incremental or semi-radical innovation. By utilizing incremental innovation, Best Snacks can wring out as much value as possible from existing products or services without making significant changes or major investments. Semi-Radical Innovation on the other hand involves substantial change to either the business model or technology of an organization—but not to both, (Davila, Epstien, & Shelton, 2006). Evaluate the Alternatives In Table three there were two goals that were ranked at a number five.
The first goal, design new marketing methods that are completely different from those of the past was chosen to stimulate creativity within the organization. Best Snacks has already spent and ample amount of time redeveloping ideas of the past and needs a fresh approach to capturing their audience. The second goal that was ranked at a number five is for the management to promote organizational wide learning. One of the reasons Best Snacks is in the position they’re in is because at some point the organization stopped learning. Management began to discourage the innovation and creativity that once the key to the company’s success.
As a result, the entire team at Best Snacks; employees as well as management need to go back to square one in learning the organization, its customers and products. Narrowed List of Alternatives The best alternative chosen are to revisit the previous marketing methods to capture some of the past product success, and to implement semi-radical change. Although it is clear based on the goals that it would be best for Best Snacks to make a complete 360 degree turn around with their business structure and approach to marketing, the cost of doing so could defeat take a toll on the company’s finances due to its declining sales.
As a result, it may be better for the organization to take things slow implementing only a semi-radical change program and revamping some of the previous marketing methods. Due to the fact that the organization was highly successful not too long ago, it may be worth taking a look at some of the processes that were in place during that time, examining whether or not success can be generated by reinventing the wheel as opposed to starting over completely. Identify and Assess Risks
The remaining alternatives; select a few employees for individual learning and implement incremental change have been identified as having too many risks to utilize in the future plans of Best Snacks. In selecting just a few employees, the leadership does not tackle the real issue of ensuring that innovation is stimulated on an organizational wide scale. It seems that an incremental change approach is what put Best Snacks in the position that they are in now. In only considering the bottom line while ignoring the significant changes that needed to be made in the product lines and processes has cost the organization in sales.
With both alternative, Best Snacks runs the likely chance that no changes will be made, leaving the organization to continue its decline. Make the Decision Best Snacks will utilize radical innovation to develop customized, strategic marketing plans for their current product lines and formulate teams within the organization to design new products. Management and employees will work together to energize not only each other but the customer with anticipation of what’s to come.
Creative advertising campaigns, team building exercises, and consistent attention to employee needs by management will position Best Snacks in the upper echelon of the snack industry. Founded in 1998, Google has obtained success by being one of the most innovative internet search engines in the world. The company name, Google is in fact a play on the word "googol," the mathematical term for a 1 followed by 100 zeros. The name reflects the immense volume of information that exists, and the scope of Google's mission: to organize the world's information and make it universally accessible and useful, (Google, 2010).
With over 150 domains in different names and languages, advertising applications, and a phone, and its own internet browser, Google Chrome, the leadership and employees at Google are constantly coming up with new ideas on how to make their existing products better and challenging themselves to create new products that will speak to their consumer needs. Google’s philosophy is embedded with a number of approaches to the principles of their organization and how they will conduct business. Specifically when it comes to design the company believes:
- Focus on people – their lives, their work, and their dreams.
- Every millisecond counts.
- Simplicity is powerful.
- Engage beginners and attract experts.
- Dare to innovate.
- Design for the world.
- Plan for today's and tomorrow's business.
- Delight the eye without distracting the mind.
- Be worthy of people's trust.
- Add a human touch.
In capitalizing on the success of organizations such as Google and the competing snack corporations, as well as returning their focus back to the people, Best Snack will move into the future retaining their top slot as an industry leader.
Develop and Implement the Solution In order to develop and implement the solution, Best Snacks must be strategic in their next steps. To take place immediately, Elizabeth Fairchild must devise a conflict management plan for employees and managers to have better communication. In order for innovation to thrive employees must first iron out the issues they have amongst each other as well as management. Getting the problems out on the table will be the first step to opening the door to communication needed for innovation and creativity.
Within the next ninety days, Sabrina McKay will develop a plan for team brainstorming. Working with Elizabeth Fairchild, a plan for organizational learning will be put into place to stimulate the employees and get them thinking about what’s next for the organization. Within six months, new product lines should be developed. These lines will be a culmination of the ideas of each person from the management team as well as the employees.
Evaluate the Results
External success for Best Snacks will be measure by evaluation of the next quarter sales and earnings.
Because the ultimate goal of the organization is to increase sales and market share in an effort to remain competitive in the industry, short term review goals are deemed best for a clear understanding of whether newly implemented marketing ideas and approaches are working. There are certain marketing elements every (startup) entrepreneur should track to grow and become more profitable. The key indicators are leads generated, leads converted, average dollar per transaction and average number of transactions per customer. Though the notion of tracking may feel like overkill, focus and improvement spring from the habit of constant measurement.
In creating a baseline, it will be much easier to focus the strategies and actions on the right areas of the business, (Jantsch, 2009). Internal measurements for determining success will be to administer another company-wide survey and small focus groups. Leadership must remain in constant communication with the Best Snack employees to ensure that most, if not all needs are being met and that satisfactions with encouraging innovation and creativity amongst employees is felt. Conclusion Best Snacks has the potential to maintain its position in the snack industry. Though the situation looks bleak, it is not as bad as it seems.
The main issue for Best Snacks is that they’ve never been in this space before. As long as management uses this opportunity to grow and learn the ills of complacency the organization should be able to avoid being placed in this position again.
References
- Daniels, T. , Watts-Holley, J. , Mobley, A. , Rauschenbach, L. (2010). Best Snacks Benchmarking Worksheet. Retrieved from MMPBL550 - Creativity, Innovation, and Organizational Design website.
- Davila, T. , Estien, T. J. , & Shelton, R. (2006). Making Innovation Work: How To Manage It, Measure It, and Profit From It. Upper Saddle River, NJ: Wharton School Publishing.
- Jantsch, J. (2009). 4 Metrics For Measuring Success: 4 key metrics can help you determine if your brand-building is working. Retrieved from http://www. entrepreneur. com/magazine/entrepreneur/2009/february/199732. html
- Jones, G. (2004). Organizational Theory, Design, and Change (4th ed. ). Upper Saddle River, NJ: Prentice-Hall, Inc. University of Phoenix. (2010).
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