STRATEGIC MANAGEMENT

MGT790
INDIVIDUAL (IN-CLASS) EXERCISE

Please answer the following questions about your company or a company of your choice.

Chapter 1 of Thompson, Strickland and Gamble, or any other book on strategic

management is a good point of reference.

The questions are:

1. Where is your company now? – Where, in your opinion, are your company as
compared to your competitors (weak, average, strong); financially sound?;
problems/challenges that need to be addressed?
2. Where does your company want to be? - referring to the long-term objectives (2 or
more years in the future); any KPIs/BSC that provide the direction.
3. How is your company going to get there? Identify your competitive advantage/ key
success factors in the industry, etc.

Q1 and Q2 allow you to conduct gap analysis while Q3 refer to the strategy (ies).

Q3 also addresses your company's initiatives to stay competitive and action plan to run its
business. You may relate to your company's business model, i.e how your company
intent to generate adequate revenues.

Please come with a 2-3 pages of write-up and submit to me after your class presentation.
1. Where is your company now?

Burger King Holdings, inc. was been founded in 1953. Burger King is the world's
number 2 hamburger chains after McDonalds. By the early 2000s Burger King is a little
left behind. Years of under-investment left it struggling in its rival's shadow by the early
2000s. Although a lot of consumers agree that it meals taste better than McDonald ones
but it doesn't have the excellent perception created the administrative power and the
aggressive marketing of his main by concurrent.

It was freed in 2002 from Diageo the number one in wine and spirit drinks, which
owned it since 1997, after a merger with Guinness. Although owned by Texas Pacific
Group for US$2.26 billion, it recovered its latitudes of the sixties. The number 2 in
hamburger fast food came back progressively in the fight with McDonalds.

Since 2004 their performance constantly increased. In their intensive marketing

campaign it targeted particularly core young male market. Advertising Age estimated
global measured advertising expenditure of US$356m in 2007; making Burger King the
worlds number 95 advertisers.

Burger King in Malaysia came in December 1997. To date, there are 20

restaurants in Malaysia. Look out for more outlets in the near future. There are currently,
3 franchise holders in Malaysia. The largest operating restaurant is managed by Cosmo
Restaurants Sdn. Bhd.

The first interior concept was the 1960s with featured artists such as Marilyn
Monroe, Elvis Presley, James Dean and vintage cars photos. The current concept in
Burger King caters for today’s customer requirement for the trendy and modern yet
tranquil.
 Comparing to their nearest competitor, McDonalds, Burger King can be rated as
average yet growing since the demand is there. The company recorded revenues of
US$2,537.4 million during 2009, an increase of 3.2% over 2008. The operating profit of
the company in 2009 was US$339.4 million, a decrease of 4.1% compared with 2008.
The net profit was US$200.1 million in 2009, an increase of 5.5% over 2008.

But in 2010, Burger King’s financial doesn’t sound good even though they are
number 2 fast food retailer. In 2010, the revenues drop and been recorded as US$2.5
billion, while their operating income also drop and been recorded as US$332.9 million.

There is something that burger king should do in order to overcome their

problems. Demands always there yet dropping of revenues become their big challenges in
sustaining their business in the future.
2. Where does your company want to be?

Burger King would like to proudly serve the best burgers in the business, plus a
variety of real and authentic foods with all freshly prepared just the way their customer
want it. Fairness, diversity, respect, caring, clears accountabilities; teamwork, high
standards and commitment to excellence become their values in business.

Burger King will prepare and sell quick service food to fulfill their guest needs
more accurately, quickly, courteously and in a cleaner environment than their
competitors. Burger King will conduct their entire business affair ethically, and with the
best employees all over the world.

The main mission that Burger King want to be is to continue to grow profitability
and responsibly and provide career advancement opportunities for every willing member
of their organizations.

And because of that reasons, Burger King now provides detailed nutrition
information to their guests so they can make informed choices. Therefore, they created
the business “Our HAVE IT YOUR WAY® brand” to fulfill their customers’
preferences.

Besides, building brand image and awareness using integrated marketing

communications is Burger King’s top goal in running their business and sustain in fast
food industry.
3. How is your company going to get there?

After several years of steadily declining profits, and upset franchisees, Burger
King decided it was time for a change, both in its approach towards it marketing structure
to the way it built and supplied new locations.

With this desire to change the way the world looked at Burger King, and created
new interest in their products, Burger King introduced its “Ace-in-the-hole”, the King. It
was the rebirth of a retro Burger King adds campaign redone for the 21st century. Burger
King has changed their target market, as well as their marketing mix used to tap into the
fast food market. Also, Burger King ensures that their strategic market planning is paid
off.

Burger King’s target audience is males, aged 18 to 35 who eat fast-food 9 to 16

times per month. While they are just 18% of Burger King’s customers, they account for
about half of all visits to the stores.

Burger Kings segments includes teens who keep up with the latest fashion and
music trends for their age group, Blue collar workers who live very busy lifestyles,
balancing children and possibly more than one job where they look for quick and
convenient meals in their hectic lives.

Besides, Burger King segment it into lower and middle class families with
children, young adults busy with school and work, such as college students and lastly
Individuals who have a passion for fast food. They are defined by the way they seek
convenience, their desire for value.

The decision to change the approach Burger King took to marketing its products
evolved from extensive environmental scanning and analysis that their marketing
considered carefully when designing their marketing mix.
 The four P’s of their marketing mix are includes their product is made up of
primarily fast food items ranging from new competitively priced value menu options, to a
line of premium menu options that have a higher profit margin for the store. Burger King
has also introduced a line of indulgent products designed to attract the heavy fast food
traffic.

Burger King hopes to strengthen its stance among their loyal customers who goes
to fast-food burger restaurants about 16 times a month and likes sports, movies, music
and video games. The typical customers’ uses about five of those visits at Burger King,
Chidsey said (Assoc. Press, 2007).

Price is designed to be competitive advantage. The range of price and set of

packages provided is really affordable and reasonable. Burger King had offered their
burgers as cheap as RM1 in Malaysia during limited time promotion. That consensus
could break down because Burger King’s competitors will fear the 700-restaurant chain
could gain a competitive advantage if its products get a reputation for cheapest price.