Gate Gourmet Swot Analysis

accession epicurean Swot AnalysisI discern supply bon vivant as an geological formation for use as case study. It is headquartered at Zurich-Airport, Switzerland and is the worlds second largest flight path catering company, providing catering returns to many of the worlds major(ip) air notes, such as British Air charges, Swissair, United Airlines, Delta Airlines, Virgin Atlantic and Cathay Pacific to name just a few. The scale and complexity of the penetration bon vivant operations is amply and it operates in global surroundings in an industry that is highly competitive and cost sensitive. This gives an opportunity to evaluate the big and micro environment in line with the strategic options that accession Gourmet has. proletariat1 (B)There argon some(prenominal) practices that ar used for strategic planning in the industry immediately and the choice of these argon endeavourn by factors such as type of industry, market realities, competitive pressures, size of th e dividing line and of course the culture and honorable practices of the composition. intend horizons wee-wee right off considerably shortened considering the dynamic nature of pedigree of the 21st century. The horizons support now be stupefy 2-3 years. There atomic number 18 however several vanquish practices that have emerged from what is observed across industriesStretch goals atomic number 18 an imperative to make strategic thinking more out of the boxPlanning processes are now regarded as evolving and flexible and it is to the organisations credit how quickly it bay window course correct.With the understanding of importance of stakeholder buy in and support there is an emphasis on communication in the strategic plan. This is an integral part of the tonicity planning in the strategic planning.Detailed plans are now created to tie the targets to activities and outcomes.An organisations competitiveness is now determined by a set interconnected core competencies and no t by a single core competency. This has emerged from the understanding that there are mingled organisational aspects that go into building a competitive advantage.In addition to the best practices mentioned above, there are some theories and frameworks that support the strategic planningSWOT synopsis for environmental abridgmentPorters 5 forces theory for environmental analysisStrategy as an ecology to understand the competitionBalanced Scorecard approachMcKinseys 7-S exemplification to understand how the organisational factors ease drive its operation strategyAnsoffs matrix to define the service or harvest-time strategyBCG and McKinsey matrix to review the product portfolio honor filament analysis as to how the organisation is adding value and interacting with its ecosystemCore Competency approach for deciding eminence approachTop down or stinker up approach for participation and communication strategical narratives that help in framing and analysis of strategic optionsTas k 1(C)For introduction Gourmet to formulate its strategy, we must(prenominal) look the fol paltryingEnvironmental analysis and the position of Gate Gourmet relative to its environment. I would recommend using Porters 5 forces and SWOT as it get out help us understand both the macro and micro environment and link it with the Gate Gourmets position in the competitive landscape.Since the industry of inflight catering is define largely by operational excellence, we can use the 4-V analysis to understand the areas of operational excellence that can be used to differentiate, not merely to drive operational efficiency, but withal to achieve competitive advantage.The SWOT allow for alike then help us understand the core competency of Gate Gourmet and if that fits with the differentiation strategy that will help it achieve competitive advantage.From the core competencies, the balanced scored card can be used to outline the business objectives that will help leverage the core competenc ies and achieve competitive advantage. These objectives will be defined across financial, customer, human resources and knowledge distributement aspects of the organisation.Task 1(D) applicable theories for the merchandising plan for Gate Gourmet are product Life cycle management using Ansoffs matrix and BCG matrix, service marketing strategy and change based marketing strategy. Looking at the product life cycle of the inflight catering business, we understand that the business is a mature business and therefore will require innovation and service differentiation focus to compete.Also, BCG matrix will help Gate Gourmet evaluate the services and geographies that can be dropped from its portfolios and the ones that wish to be consolidated and invested in. Ansoffs matrix will help Gate Gourmet to decide the innovation strategy through new product launch. This will help improve its utilization of the supply chain resources and the investments and thus help reduce its per unit be.Tas k 2(A)There are 2 general strategic options that are available to Gate Gourmet Cost Leadership and Differentiation. Let us look at the relative advantages and disadvantagesCost Leadership Gate Gourmets business drives the indispensability for it to be increasingly efficient as its airline customers face heightened cost pressures collectible to the changing business and economic scenario. It operates in a business which is low margin and increasingly coming under further squeeze. Hence Cost lead is a requirement for business in this industry in the in flight catering business. It cannot be a source of competitive advantage.Differentiation Given that efficiency focus is a requirement or a loss measuring in the industry of Gate Gourmet, what can lead to a competitive advantage is through a differentiation strategy. Quality and flexibility are areas that can help Gate Gourmet differentiate itself to its competition. However, focus on fibre and flexibility will lead to oerheads th at can act against the cost leadership requirement. Therefore Gate Gourmet will also need to have a robust operational strategy to drive the quality and flexibility differentiation with cost leadership.Task 2(B)The following are Gate Gourmets mainstay stakeholdersEmployees and contractors The strategy of flexibility and consolidation will impact the employees as Gate Gourmet will have to resort to lay offs for its permanent employees and look at flexible hiring model to suit its operations.Raw Material Suppliers Gate Gourmet will have to look at creating a deeper alliance and culture overlap to implement its strategy of flexibility and quality focus. This will happen though further desegregation of their systems and through real duration study sharing. For cost leadership, Gate Gourmet will need to get into longer term contracts and choose strategic suppliers that can offer it crack unit prices.Supply Chain/Logistics partners Gate Gourmet will need to have more integration an d correctment with its supply chain partners to put in conduct a quality and flexibility strategy. It will need to agree with them on standard quality practices to witness consistent quality experience creating the competitive advantage that Gate Gourmet is face at.Airlines Flexibility and cost leadership will require Gate Gourmet to receive information from its airline customers in real time. Gate Gourmet will also need to haveTask 2(C)The following are the key areas that need to be paid special attention to by the management team implementing the strategyCommunicationThe communication of the strategy, its objectives and the rationale behind that needs to be clearly joint and communicated to the employees. This is necessary to create the appropriate buy in from them.The communication also needs to be planned to the customers of the organisation to share with them how the organisation is changing for the better and aligning to the market and competitive requirementsThe partner s of the organisation also need to be informed and aligned with the changes so that they too can change their work practices to align with the organisational strategy.Organisation designThe organisations structure needs to support the new strategy and ensure that the execution is supported by the new organisationThis will also ensure resources are allocated efficiently and minimise the wasteTraining and developmentTraining classs need to be implemented for the new and living employees to bordering the information and skill gap unavoidable to execute the new strategyInvestments into Systems and IntegrationFor close integration with the partners and customers of the organisation systems need to be put in place to support this. The organisation will need to invest in infrastructure and work practices to put these systems in placeContractual Strategy Serviced Based and Strategic partnersThe contractual relationships with the partners may need to be revisited and consolidated in vie w with the new strategyAlso existing partners may have to revisit the service levels and scope of the contractual relationships.Task 2(D )CommunicationOrganisation designTraining and developmentTask 3Develop vision, representation, objectives and measures of theseTask 3(A)Vision statement articulates how the organisation sees itself in the future, in fact it is the long term goal for the organisation which it strives to achieve. Ideally this goal should be such that it can never be achieved by the organisation and it should serve as the drive for the organisation.A mission statement is more of a goal statement for a fixed tenure of time and is usually derived from the Vision statement. From the mission statement the organisational objectives year on year can be derived.Value of the organisation defines the principles and ethics that the organisation abides by and holds dear. These could be targeted at doing business in a specific way, or giving high consideration to employees and c ustomers. These are principles that are considered to be above the business objectives and are the fundamentals on which the company envisions its future.There are many ways in which these can be measured. A representative way of doing this is evaluating how customers and employees believe the organisation is doing business keeping in mind the vision, mission and values. Also, employees can be interviewed to determine how their individual values are aligned to organisational values and if they hold the last mentioned close and let it reflect in their working. The prevailing organisational culture also reflects how the vision, mission and values are absorbed by the different stakeholders of the organisation.Another way of measuring the effectiveness is to determine how the organisations performance management system is aligned to the mission and goals that have been set and how these are supported by the training, development, mentoring and coaching in the organisation.Task 3(B)Gate Gourmet abides a set of distinguish values and that drives its vision of its business. The Gate group was established as a master brand to reflect the growing diversity of the business. The shapes make up the outline of a star in the logo symbolize Gate groups individual companies and their vast picture of capabilities.The points on the star represent the brand values with which we make e genuinely effort to serve our customersQUALITY We crawl in best-in-class products and services.INTEGRITY We pledge an ethical and authoritative relationship.RELIABILITY On-time and with a clear focus on safety.VALUE Optimizing value for you throughout the supply chain.FLEXIBILITY One size does not fit all. We are attuned to your needs.PASSION We lead through innovation and inspiration.RESPECT We celebrate the diversity of cultures among our employees and customers.RESPONSIBILITY We strive to protect the environment and to be a good corporate citizen in our communities.The companys we bsite gives the following information on its mission statement Customers prefer us because passion shines through everything we do. We measure our success by the success our customers enjoy. (Refer tooth root 2)Task 3(C)The organisations cultural and ethical environment provides a cerebrate for realising its vision and mission. These are execution ingredients that it requires to attain the vision and mission that it has set for itself. The culture and ethical conditions are determined by how the employees and partners of the organisation have adopted and aligned with the vision, mission and strategy. It is main(prenominal) to note that without these supporting factors, even the most well crafted vision, mission and strategy cannot be implemented.The stakeholders need to align with these and the McKinseys 7-S model reflects how these factors interact with each other and determine how vision, mission and strategy get implemented.Task 3(D)Gate Gourmet operations can be described as extremely complex requiring optimized efficiencies and responsiveness at the same time, where it must be able to achieve very stringent operational objectives in an extremely competitive, dynamic business environment. Some of its operations objectives are listed and evaluated below along with relative importance of criteria selected for evaluation, conflicts with other objectives and how Gate Gourmet accommodates these changesDriving lour costs through economies and processes Due to the nature of the competition in the industry, and where customers are always looking drive costs lower to increase their profitability, the cost per meal that Gate Gourmet charges to its customers would directly impact the amount of business that it is able to generate from its existing and new customers.Flexibility, responsiveness to changing customer needs and ability to operate in an dynamic environment Though the company has to offer very competitive pricing, it is also very important that the co mpany that it is very flexible to the constantly changing customer requirements and is able to deliver the product and service that are closely aligned with customer expectations. As can be seen from the case, the final requirement for a particular flight is not known till hours before the flight and even that could change due to last minute cancellations or new booking, due to which they have to operate in a just in time fashion, of being able to come up with delivery at the moment the customer requires it.Maintenance of highest quality standards As Gate Gourmets customers are airlines that are extremely conscious of offering the best to their passengers and also ensuring that they have good branding as a company offering the highest quality experience, they would want to ensure that the food that is served on their flights is of the highest standards and that various processes are followed for maintaining quality and consistency. Critical success factors for Inflight Catering ser vices Singapore Airport Terminal Services practices as management benchmarks , Type Article, sheath study, Author(s) Zeph Yun Chang, Wee Yong Yeong, Lawrence Loh, Source The TQM clip Volume 9 Issue 4 1997Reliability and service guarantee In addition to the above discussed factors, a very important operational objective for the company to achieve would be the ensure very high reliability in the services that it provides and also providing very high service levels that would ensure its customers business work as smoothly as possible. Critical success factors for Inflight Catering services Singapore Airport Terminal Services practices as management benchmarks , Type Article, Case study, Author(s) Zeph Yun Chang, Wee Yong Yeong, Lawrence Loh, Source The TQM Magazine Volume 9 Issue 4 1997Seamless communication and working with a vast array of partners in a global supply chain As discussed above, the operation of the company, due to the scale at which it operates is very complex where it has to coordinate multiple aspects and work with multiple partners and customers to deliver the required level of service, it is a very important operational objective that there is a very high amount of information sharing and close working together across the entire value chain that would allow for planned service delivery. This is again an important objective and is aligned with the other objectives that ensure that the company is able to deliver.Task 4Explore the implications of changes in the general and marketing environment for organisationsTask 4(A)Let us start by analysing the typology of Gate Gourmet which will then set the context for relevant objectives for Gate Gourmet. This is the key to understanding operations and any gaps in their performanceVolume clear Gate Gourmet completes a high volume of daily transactions across its supply chain with 534 thousand meals a day worldwide, on fairish 195 million every year. It has 115 flight kitchens in 30 different countrie s, in locations as diverse as Hawaii, Los Angeles, Buenos Aires, New York, Madrid, London, Bangkok, Sydney and Tokyo. Also, it emphasises working in unison with cleaning staff, baggage handlers and maintenance crews to ensure that the aircraft are prepared quickly for departure.Variety Gourmet Gate faces variety across its airline customers and also within its customers due to the geographical spread of the airline operations, the customer needs differ. Creating a high variety situation for Gate Gourmet. To summarise we the following drivers for varietyGeo disperses airline organisationGeo dispersed end customersCustomizations of the end product required based on airline/geoVariation in requisite Gate Gourmet faces clean athletics in demand that typically emerges from the change in booking status of passengers which is the nature of the airline industry. While demand variation can be high during emergency situations as had been the case during the aftermath of September 2001. Visibility The Gate Gourmet operations are not customer facing slice they supply a product and service that impacts the end customer experience for their airline customers.Task 4(B)Give the 4 V analysis, we need to look at the implications for Gate GourmetHigh transaction volume would mean capital intensive operations for Gate Gourmet which will help it drive high repeatability and lower its unit costs as the volumes increases and economies of scope kick in. Gate Gourmet will also pay attention to introduce specialisation in its operations and allocated its resources as per the areas of specialisation these will be in terms of the geographic operation of the airlines and the airline itself.High variety in its business would mean Gate Gourmet operations to be flexible and aimed to meet the customer needs. The complexity that this introduces in the operations increases the unit costs.Variation in demand is though mediocre, but the Gate Gourmet needs to be in touch with demand and ha ve the ability to anticipate the demand fluctuations and flexibility to cater to these demand variation. Capacity redundancy may not be crucial as there is no regular high variation in the demand. This factor also drives the unit costs upwards.Visibility of operations for Gate Gourmet is low for the end customer, therefore is a delay between the production and consumption of the product of Gate Gourmet. This allows for higher standardisation and staffing with resources with low contact skills. This allows high staff utilisation and centralisation of production therefore driving the unit costs down.The analysis and implications leads us to the objectives that will be key for meeting Gate Gourmets customers and end customer expectationsDependency of delivery Order Qualifying criterionSpeed of reaction Order Qualifying criterionCost Order Qualifying criterionQuality Focus Order Winning criterionFlexibility- Order Winning criterionWhile the high volume and low visibility of the oper ations help Gate Gourmet standardise the operations and resourcing driving down the unit costs through economies of scope. They have also reduced the number flight kitchens by 10% from 115, when the case was published, to 97 currently and also their daily volumes have do for(p) up by 10% hinting at strong economies of scope driving their unit costs lower. While the need for high variety and medium variation require its operations be flexible and integrate with the customer demand scenario. This drives the unit costs upwards and creates a challenge for portal Gourmet in this low margin and low cost business.Task 4(C),(D)Organisation DesignGate Gourmet advocates the concept that the organisational structure should reflect the core processes undertaken by the business, with a manager given responsibility for each process. Under the traditional structure, if there is a problem with servicing a flight, no one manager would be responsible-the fault might lie with the purchasing manager for not ordering supplies, the equipment manager for not having the right equipment, the production manager, or the transportation manager. So, some caterers have now organised their production units based on core processes. Gate Gourmet in Geneva (Emad, 1997) identified these as Equipment Handling, Customer Management, and Goods Supply and planningSpeed of ResponseGate Gourmet integrates tightly with its upstream and downstream supply chain partners through transparent and real time information sharing through the SCALA and e-gatematrix ensuring that the same information is available to all the partners at the same time demonstrating backward and forward integration for creating competitive advantage. They have integrated the SC partners giving the last mile reliability to their end-customers, though they function as different organisations the information sharing couples then tightly and part them reach rapidly to changes in their environment. It has created standardised menus in SCALA to ensure consistency and repeatability in its menus.Quality FocusFor quality Gate Gourmets global team of talented and accredited chefs is restore to serve your catering needs and deliver on your vision. (Source http//gategourmet.gategroupmember.com/index.php/culinary)Gate Gourmet has instituted a total quality management initiative that is aimed at inculcating process quality than relying on inspection quality. This initiative is called Airline Catering On The Move Global Service Excellence and has been implemented internationally across its network of operations. This program was developed through the expert support of Dr. Donald Fisher, a globally-acknowledged expert in the quality management field. Dr. Fisher, of the Mid-South Quality Productivity Center (MSQPC). Dr. Fisher has been acting as an external consultant and has been instrumental in this initiative by bringing in his global experience and expertise. This alliance has been particularly valuable as Gate Gour met operates in an international context as well. (Source http//www.msqpc.com/Newsletters/Spring2003.pdf)(Source Title High flyer Author(s) Bettye Wells Miller Journal Managing Service Quality)FlexibilityCustomer requirements of Gate Gourmet are such that it needs to assemble meals as per the specific guideline provided. Also, the packing and loading onto the service trolleys are as per specification. These service trolleys are loaded onto huge coolers and into loader trucks to send to the aircraft galleys just before the take off. Gate gourmet operates nearly 1700 of these vehicles and many of these are already equipped with chill systems, cameras and state of the art engines to meet with the strict FDA regulations and also comply with the environmental guidelines.Cost FocusGate Gourmet also follows aggressive HR policies to manage its human resources and ramping down based on changes in its customer demand. It also got into union issues due to these practices in the UK in 2005. ( Source http//www.itfglobal.org/solidarity/gategourmet.cfm) Gate Gourmet is also looking at moving from permanent employee base to flexible staffing practices again in an attempt to be flexible and responsive. (Source http//news.bbc.co.uk/2/hi/business/4153366.stm) It is reported to making losses globally and trying to revamp its operations to stay profitable. (Source http//www.nytimes.com/2005/08/15/business/worldbusiness/15iht-gate.html?_r=1)Gate Gourmet is consolidating its partnerships and acquiring logistics companies to allow it to backward integrate way on driving its unit operational costs lower. It is also looking at longer term contracts with it customers to assure a business volume over time.It is also innovating and getting into new lines of business to improve utilisation of its supply chain reduce its cost of operations and also drive top line growth. Gate Gourmet has entered into an alliance with ARINC Inc. (leader in onboard retail management). They are working toge ther to promote on board sales programs for the worlds airlines and rail systems as well. This is helping Gate Gourmet improve utilization of its resources and reduce idle time. (Refer http//www.arinc.com/news/2008/04-30-08.html)Gate Gourmet has also diversified into non-airline catering where it can use its existing supply chain to service on-land and train passengers as well e.g it has teamed up with Starbucks and railways in Portugal. (Source http//gategourmet.gategroupmember.com/index.php/culinary/non-airline-catering)(Source Title Developing new products and services in flight catering Author(s) Peter JonesJournal International Journal of Contemporary Hospitality Management)Task 5Plan for the implementation of a general or marketing strategy.Task 5(A)The mission and goals will help determine the business objectives that the organisation needs to achieve. Also, timelines for achieving these objectives can be set based on the mission and macro environmental factors of the organis ation.The objectives and the timeliness can then be broken down into lower level objectives and activities with shorter timelines. Each of these activities will be assigned to individuals with responsibilities and also resources required to complete these activities. Each of these activities will have outcomes outlined and linked to the key performance indicators. These can then be established as milestones and linked to the key performance indicators that can be used to review the milestones and activity status.Therefore the timetable will consist of the following key elementsHigh level objectivesLow Level ObjectivesLow Level ActivitiesEstimated duration of completionMilestonesResponsible individuals and departmentsResources required to complete the activitiesDesired outcomesKPIs to be used to evaluate milestone statusTask 5(B)Task 5(C)While crafting a strategy, key performance indicators can be determined at the time of planning. A balanced scorecard typically helps determine the required KPIs along the different areas of strategic importance. Also, targeted values for these KPIs can be established during the planning process and how these need to be re-visited with time.The data required for these KPIs can be collected regularly and published as per a pre-determined schedule. These KPIs can then be compared to the target and a root cause analysis be done for those KPIs that are off the targets. Corrective action can then planned based on the root causes determined.Task 5(D)Post the difficulties that the customer airlines of Gate Gourmet were facing, Gate Gourmet immovable to go with an approach of flexibility and to be able to match its cost structure with the changing financial situation of its customers. It decided to model its workforce requirement to this strategy as well and laid off workers in UK and US. However, there was an immediate backlash of these lay off in particular in the UK leading to major business disruptions in Heathrow airport leading to grounding and delay of several flights prominent airlines. This had not been factored in by gate Gourmet management and they had to go for significant damage control measures post this fiasco. This indicates why Gate Gourmet should have admonishered proactively the effects of its flexible strategy.The decision of the coca plant Cola company to expand its operations in India as ap art of its Asian strategy was faced with issues when its expansion in Southern India was faced with besotted resistance from the local population and community on the detrimental effects of the factories on the ground water table. This again demonstrated the need to the company to monitor and factor in the community aspects of a strategy.