Kraft's Competitive advantage

Kraft food Inc. has recently announced the appointment of Jeri Finard as the executive vice president, global category development. Jeri will report directly to Roger Deromedi, Kraft’s CEO. The global category organization is responsible for driving new product growth platforms and leading global category strategies. Jeri has recently led Kraft’s North American beverage sector as group vice president and president. In addition, she has served as director of strategy and new product development for Maxwell house coffee and post cereals. Jeri was also the general manager of the Callard and Bowser business which included the Altoids and Tobleron brands. She also led the desserts division and coffee division as general manager. In total, Jeri Finard has more than 20 years of experience in the foods and beverage sector. Hence, I believe that Jeri Finard is a sustained competitive advantage for Kraft foods.

According to Barney, there are four questions that need to be answered to know whether a resource in the firm will give the company a sustained competitive advantage. Those are questions of Value, Rareness, Imitability, and organization:

· Question of Value: Jeri Finard is a valuable resource to Kraft Foods. According to the article, Jeri has led the coffee team through the expansion of Tassimo in the U.S. and was integral in developing key partnerships with Starbucks coffee and Tazo tea. She also led to the acquisition and expansion of Fruit(2)O. Hence, Jeri is a resource to Kraft’s food that will enable it to exploit environmental opportunities and neutralize environmental threats.

· Question of Rareness: Not a lot of firms have people as ambitious and energetic as Jeri. Although someone could argue that many of the large companies possess people such as Jeri, I say it can’t be because no two humans are same in nature. In addition, if their was a lot of people which posses similar skills to Jeri, how would someone explain the high demand and low supply on such people. Not only that, companies usually pay them very well in form of payroll and compensation to attract them and smaller companies are not able to afford them.


· The question of Imitability: As I mentioned above, no two humans are same in nature, therefore, it would be hard to imitate Jeri Finard as a person. However, other companies can look for people who share similar skills as Jeri, but this will be overwhelming and very hard to do. Additionally, this person’s skills will never be exactly as Jeri’s skills.

· The question of Organization: Kraft foods are a very well organized company. As it’s mentioned in the article, Jeri is going to directly report to the CEO of the company. If we analyzed this point according to Daft’s framework, I would say Kraft foods organization structure resembles the divisional structure more than any other structure.

a digital photo display industry?

When I was in London last week taking photographs of the different real size statues in Madame Tussaud's with my new digital camera, I never stopped thinking of the most efficient method of showing those pictures to my friends and relatives. Then I heard about Philips recent inventions the digital photo display. The idea itself is not new; however, the revolutionary twist Philips came up with is the new thing here. This new product is simply a digital frame for your digital photos. All you have to do is insert the memory card in the frame and it will show the photos for you, either as a slideshow or one photo. Furthermore, it has a rechargeable battery or can be connected to AC power. Philips invented this product as part of their basis of differentiation. Obviously, many new products are available in the market that can help you show your digital photos. HP invented memory card printers; Sony has memory card slots in their TV, or you can take the easiest path and just show them on your laptop. Philips decided to mix tradition with technology. It is the traditional way of framing your memories and the more advanced way of digital technology. Moreover, this new product will certainly be more efficient and effective than all the other methods and offers more benefits to the customers. It’s less time consuming and more visible. By more visible I mean that it can be kept anywhere and at anytime and still could be seen. The question that remains to be answered is whether in the future we will see more variations of such a product. For example, a digital photo album or digital photo wall frames. In my opinion, I see Philips new product is the first step towards a whole new range of products and maybe a whole new industry.

Coca Cola's new commercial

Coca Cola has recently launched its new TV commercial that features Arabic pop star Nancy Ajram. In the commercial, Nancy performs her latest hits. The commercial was filmed by an international director and it had an exceptional positive feedback for Coca Cola. In such an industry, differentiating yourself from your rivals is very critical. Pepsi, Coca Cola’s closest rival, was using Arabic pop stars for its Middle Eastern commercials long before Coca Cola. In fact, Pepsi’s market share was higher in the Middle East than any other place in the world. Coca Cola, which its products were banned in the Middle East for a long time, had to do something to increase its market share and increase rivalry with Pepsi. In my opinion, Coca Cola’s commercial was made in a way more appealing than Pepsi’s pop stars commercials. Coca Cola made more use of color and their idea was more unbroken than that of Pepsi’s commercials which their ideas are kind of fragmented. Furthermore, Pepsi shows their international commercials in the Middle East more than their Middle Eastern once. Their international commercials features international pop stars such as Britney spears and Beyonce. However, Coca Cola tends to view only advertisements relevant to the product/market scope of their product. In contrast to Pepsi, they only have commercials with Nancy Ajram. In other words, they try to create an association between the pop star and the product. Hence, Nancy becomes a partner in Coca Cola’s value network. Coca Cola is very well known for its strong marketing capabilities. Their brand name is only one of the numerous strategic assets they own. Will the company that once changed the color of Santa for good be able to regain its position in the Middle East with its new marketing strategies? Only time will tell.

The secret behind Etisalat new Products

Etisalat has recently launched a new package aimed for UAE visitors. The new Ahlan package is priced at 90 Dhs and gives the visitors the convenience of instant communication for 90 days. In addition, the first three minutes to any international destination is free of charge. The package also comes loaded with many other options. The new products and services Etisalat has been recently launching didn’t come out of the blue. Less than 5 years ago, Etisalat did not care that much to increase its product portfolio. In fact, they had only several services that were directed to the general consumers. Etisalat had all the support from the UAE government and they a 100% of the UAE market. They had a monopoly. Recently, some non-market issues aroused for Etisalat which didn’t work for their favor. People were complaining about their high prices and their 100% control of the market. After several negotiations with the authorities, they came to a conclusion that a better economy will result if the monopoly was taken. Thus, the new legislation was enforced and the monopoly was removed. It wasn’t until their monopoly was removed that Etisalat started thinking of new business concepts. They knew that it will be a threat to them; therefore they decided to diversify their operations and acquire as much companies outside as possible. They also started introducing new products, such as the Ahlan and Najem packages. Moreover, they started offering new services and reducing prices. It didn’t take so long until a new communication company was announced, and now Etisalat is suffering from the threat of new entrants. The new company, EITC, is aiming to capture 30% of the UAE market in 3 years. Obviously, Etisalat strategy is to gain as much customer loyalty as they can. The new company will not start its operations until mid 2006, this will give Etisalat a plenty of time to think of new ways to capture the consumer. Will the new company be able to take a slice of the giant round piece of pie? We shall wait and see.

Faisal Alhadi
6234

tags: Dubai | UAE | etisalat | ahlan

BenQ-Siemens, The new Sony-Ericsson?

Article link: http://www.strategiy.com/electronicsinews.asp?id=20060212013616

BenQ mobile has recently launched its new consumer brand BenQ-Siemens. This new brand is the result of BenQ acquiring Siemens mobile phones unit last June. The new company will try to focus on the 3G arena and are hoping to achieve a financially stable company by the end of 2006. The question that came on mind is: will this be easy to achieve? The first thing that I noticed was the name of the company; it felt as if they were trying to imitate the successful collaboration between Sony and Ericsson. BenQ is a relatively new brand that has done well so far in areas other than mobile phones. On the other hand, Siemens is a very well known brand; however, their mobile phone unit was never as successful as its rivals. Therefore, it seems that BenQ mobile didn’t notice the unique historical condition that Sony and Ericsson have which led to a very successful brand. Sony was always known for its innovative products and strong marketing capabilities and Ericsson was known for its first class technology in mobile phones. What is more appropriate to say is that BenQ mobile didn’t see the relationship between these two companies’ strategic assets, which Barney calls it causal ambiguity. This leads to my second point which is why didn’t BenQ try to develop its name in the Mobile phone industry instead of acquiring an already established firm. The most logical reason I was able to think of was high barriers to entry. BenQ would have needed capital requirements, access to distribution channels, and product technology in order to market its products effectively and efficiently. Lacking all these resources, it was a wise decision to acquire an already established company. However, in such an industry, rivalry is very intense among competitors and speed and innovation is a priority. Consumers in this industry tend to stick with one brand. BenQ-Siemens should try to position them selves in a unique way to be perceived as different from its competitors.

Faisal Alhadi
6234

Response to Effect of Danish Boycott Patchy

Original Article: http://www.arabnews.com/?page=1§ion=0&article=77011

Recent data suggests that the boycott on Danish products from the Middle East had a very disastrous effect on its companies and economy. Arla Company said that in the 1st few days of the boycott its sales dropped to zero. This shows us how buyer power can have its effect on the economy of a country. I don’t claim to say that I know anything about the Danish law, but I assume that the Danish companies pay income taxes like any other European country. The Middle East market is a huge market for many Danish companies. Especially for diary Products and foodstuff companies, the Middle East was one of their major markets. Loosing such a huge share in a very short time would not only harm the company but the Danish economy as well. Harming the economy would be in fewer taxes paid. Interestingly, Boycotting Danish products will increase the sales of its substitutes. For example, instead of using Lurpak butter for a specific kind of food, now the people will turn to Arabic gee instead. Therefore, in the coming days we will notice a huge increase in the sales of substitute products. The article also mentions the SADAFCO Company which was originally half Danish and Half Saudi. Although the company is now 100% Saudi, people still associate it with the Denmark. The company had to place an announcement in a newspaper to clarify this matter after it noticed a decline in its sales and stocks price. SADAFCO claims that it has no relations with the Denmark and produces their products locally. However, because SADAFCO gained its strategic assets and core process from Danish companies, people associate it with them. The announcement that SADAFCO made in the newspaper was part of its fulfillment and support to its customers. Hopefully, in the coming days we will see what effect the announcement had on SADAFCO.

Faisal Alhadi
6234

Google's Evil in China

What I noticed from the article “the real cost of Google’s sellout to China” is that the company had a barrier to entry by the policies enforced by Chinese government. Although Google was already their in the Chinese market, it was “badly hampered by the filters placed on access to it by the Chinese government” This might not seem as a traditional barrier to entry, I would call it a barrier to work efficiently and effectively in the second largest market after the US. If they couldn’t work as they should be working, they will be loosing market share to other competitors. Compiling with the government policies would give Google a competitive edge in China. Therefore, Government in China is working as a force of industry competition by the policies it adopted. We can see here that Google was in a conflict between their core process, which is search engines without any limits and the policies of the Chinese government. The Chinese market which is expected to grow larger than the US market soon can’t be underestimated by any company seeking to grow. However, what Google did was right or wrong is still a matter of debate. What I think they should have done is treat the US government and Chinese government equally, not favoring the one with more benefits on the other.

Faisal Alhadi
@00006234