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Section: B Submitted To
Submitted On April 21, 2008
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First and foremost, we would like to thank Allah for His help and granting us the ability to undertake this subject. It is by His Will that we have been able to complete our term report. We would like to pay immense gratitude to our parents for their continuous support and encouragement in all that we have done. Also, we would thank Mr. Javaid Ahmed for assigning this task to us, which has enlightened us further in the field of Strategic Management. Last but not least, we would also like to thank Ms. Samar Fatima Mirza (Marketing Manager) of Nando’s for giving us her precious time and providing us with valuable information regarding the company.
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LETTER OF AUTHORIZATION
April 21, 2008 Dear Reader, We are students of Strategic Management at IoBM and have been authorized by Mr. Javaid Ahmed to prepare a term report on “Strategic Management at Nandos Pakistan”, which is to be submitted on April 21, 2008. The preparation of this term report required us to perform a thorough analysis of the restaurant services industry. Sincerely, Group Members
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determination and devotion of past 4 months.LETTER OF TRANSMITTAL April 21. 2008 Mr. strategic analysis and recommendations and strategic implementation. Javaid Ahmed Head of Management and HRD Department Institute of Business Management. If you have any additional questions. Karachi. micro-environmental analysis and internal company resources. This report consists of the macro-environmental analysis and industry attractiveness. the company and competitor analysis. Respected Sir. The report has been completed after the perpetual hard work. Thanking you. Group Members -v- . we would be pleased to answer them. This is the term report on “Strategic Management at Nando’s Pakistan”. Sincerely.
. In this part the core competencies of Nando’s are discussed and value chain analysis and strategic cost management process is carried out. in this part the input/matching/output model is discussed where through various matrices a number of strategies are recommended.EXECUTIVE SUMMARY This report covers the Strategic Management Practices at Nando’s Pakistan. In the second part the company and competitor analysis is carried out through CPM and it is found out that Nando’s is doing better in few areas than its competitors and relatively bad in others. Also. Apart from that it is also recommended to the board the balance business scorecard as a strategic performance evaluation process distinct from the traditional financial. The third part discusses the micro-environmental analysis. marketing and HR evaluation methods. Also. in this part the IFE is calculated and is found out that Nando’s is doing above average in it. The first part of the report talks about Porter’s five forces and the PEST analysis to find out the attractiveness of the food industry. The three main strategies that Nando’s can pursue are: Market Development. In this part the EFE is also calculated and it is found out that Nando’s total weighted score is below industry average. In the fourth part.vi - . The last and the most important part is of strategy implementation in which the components of strategy implementation are employed and recommended to the board as to what the company will need to do to implement a new strategy or fine tune its existing strategy. In the end a diagnostic survey of primary and secondary management practices is also carried out and recommendations are given on the basis of making 4 + 2 work for Nando’s. Product Development and Backward Integration. The food industry is reasonably unattractive as there are already various restaurants and café’s in major cities of Pakistan. strategic analysis and recommendations are given in which the generic strategy of Nando’s is stated which is Focused Differentiation Strategy.
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......25 2...............................................................4 Grand Strategy Matrix......................................................1 Nando’s Mission Statement.............................................................................................................15 1........................................vii - ..........2 BALANCE BUSINESS SCORECARD......................................................................................................26 3...........6 QSPM..................1 Nando’s Vision Statement...........................................................................................................52 8...................2.................................... REFERENCES......................................................................................................17 2...1...........................................................................................1 TOWS.......................... MACRO-ENVIRONMENTAL ANALYSIS AND INDUSTRY ATTRACTIVENESS......................................................11 1.....2.....................................................46 6......... DIAGNOSTIC SURVEY OF PRIMARY AND SECONDARY MANAGEMENT PRACTICES ...................................................4 EXTERNAL FACTOR EVALUATION (EFE)........................1 CORE COMPETENCIES..............................................................................................................................42 5...........................1 PORTER’S FIVE FORCES...................................................15 1...........................................................2..2 SPACE Matrix.......................................................................................................................................................................................1.........5 Matrix Analysis and SWOT Summary........................................................................................37 5.2....3 STRATEGIC COST MANAGEMENT PROCESS.....................28 3....................................................... COMPANY AND COMPETITOR ANALYSIS.............................17 2......................................................................................................................................................................................................36 5.........................2...............................................43 5....................................TABLE OF CONTENTS 1........................................ COMPANY INTRODUCTION AND HISTORY......................15 2........................................15 1............................29 4....................43 6............ MAKING 4 + 2 WORK FOR NANDO’S..2 OVERALL MACRO-ENVIRONMENTAL PEST FACTORS............................................2............41 5.................1 GENERIC STRATEGY...................32 4....................................2............................................37 5..................................................................28 4.................................................................................................. STRATEGIC ANALYSIS AND RECOMMENDATIONS...................15 1............................15 1...............................................................................55 9...................35 5........... STRATEGY IMPLEMENTATION.....................................................................................................1 COMPETITIVE PROFILE MATRIX (CPM).............2 Recommended Mission Statement....................2 INPUT/MATCHING/DECISION MODEL...........................30 4............................2 MISSION STATEMENT..........................46 6.............................................................................................................................3 KEY DRIVING FORCES AFFECTING THE INDUSTRY.......................................3 Internal External (IE) Matrix.......36 5......................2 Recommended Vision Statement.....2..........................................................................................24 2.......................2 VALUE CHAIN........................49 7........................................1 COMPONENTS OF STRATEGY IMPLEMENTATION ...........1 VISION STATEMENT...................39 5.................29 4.................57 ................................... MICRO-ENVIRONMENTAL ANALYSIS AND INTERNAL COMPANY RESOURCES..................................4 INTERNAL FACTOR EVALUATION (IFE)..................................
The cockerel has. At Nando's our policy is based on those principles and our flavor. These explorers were not afraid to live… Exploring life: These famous Portuguese explorers were trying to establish a route to the East where it was rumored that gold could be found (read on and you will learn that they discovered a treasure that would prove to be far more valuable than gold). The Portuguese settlement began to flourish and life soon revolved around early evening feasts. The pilgrim found his way to the Judge who was to decide his fate. This legend dates back to the 14th Century. A story that dates back centuries. they believe it's the best in the world. The pilgrim pleaded. to this day. We have faith in our product and will do you justice with a meal to delight you and the friends who have the good luck to be entertained by you. Nando's Chicken. a passing pilgrim was wrongly accused of theft. The judge was about to commence eating a roast cockerel for his dinner. good wine and lots of laughter. Company Introduction and History Nando's believes in their flame-grilled Peri-Peri Chicken. The rich and fertile lands of this sub-tropical region enticed many explorers and their families to settle far from the cold climes of a congested Europe. It was there that they established a port. service and quality is legendary. each narrator adds his own flavor. "IF I AM INNOCENT.Strategic Management 1. justice and good luck. The explorers realized that they would never make it around the tip of Africa all the way to the East without a stop-over to replenish and rest for their long journey ahead. he only had his faith to call upon. and like all legends. Institute of Business Management Page 11 of 57 . The pilgrim was released and went on his way. for which the penalty was death. no. been the symbol of faith. They came across a spectacular landing spot in a Southern African country now known as Mozambique. In Barcelos. James (the patron Saint of protection) that justice be done. with good food. Feeling threatened in a foreign village. all in celebration of their new-found home. this 8th wonder of the world has much more of a story behind it. MAY THAT COCKEREL GET UP AND CROW!" The cockerel at once got up and crowed heartily. no. to a time when brave men and women (it's true there were women explorers they just never got the credit they deserved) set out from Europe to explore new worlds and to discover new sea routes to lands of promise. a small town in Portugal. He appealed to "Our Lady" and St. a miracle of life: Nando's Peri-Peri FlameGrilled Chicken is a miracle but it didn't fall out of the sky.
the spice of life: The Portuguese explorers came into contact with African people who introduced them to a little treasure called the African Bird's Eye Chilli. fell in love with Peri-Peri Flame Grilled Chicken. carrying with them the Nando's flame that would spread the Fire and Passion of Nando's to all corners of the globe. Peri-Peri gives life to cooking: You can imagine the delight of the culinary-adventurous Portuguese mama's. In a small suburb called Rosettenville. The African people called this fiery little chilli. They knew that the world had not tasted anything like it. It was called Chickenland. the unique MozambicanPortuguese style of Peri-Peri chicken made its way to Johannesburg. The women were also delighted with the effect that Peri-Peri had on the libidos of their men and it was no wonder that they were constantly smiling. who were already in heaven with their fresh vegetable gardens and the abundance of wild meat. Johannesburg. The settlers immediately experi-perimented with Peri-Peri in their cooking and because much of life revolved around food Peri-Peri became an integral part of their lives. They made the owner of Chickenland an offer he couldn't refuse. Nando's is born: In 1987 two great friends. when they discovered the secret powers of Peri-Peri and its effects on their cooking. Robert and Fernando immediately set off on a journey. Peri-Peri Chicken and Gold: About 413 years and 2 days after the explorers had discovered Peri-Peri.. Pili-Pili. The settlers were amazed that something so small could be so satisfying. Gold was the reason many people rushed to Johannesburg around the 1900's in search of riches. to cash in on the frenzy. the city of gold. Whether this fiery little chilli was indigenous to Africa or introduced was not certain. The Nando's Barcelos Cockerel: A symbol of life.Strategic Management Discovering PERI-PERI. South Africa. The explorers tried in vain to pronounce Pili-Pili but ended up with their own version called Peri-Peri and to this day the Bird's Eye Chilli is still known as Peri-Peri. Many Mozambique-Portuguese settlers moved to Johannesburg. Robert and Fernando. Institute of Business Management Page 12 of 57 . changed the name to Nando's (short for Fernando's) and by the end of 1987 the first Nando's was born in the humble suburb of Rosettenville. They set up informal restaurants that served their famous style Peri-Peri chicken. Peri-Peri added flavor and fire to all their food making them feel alive. South Africa. Next stop was the rest of the world. but it is certain that the rich and fertile climates were perfect for the Bird's Eye chilli to grow with wild abandon. They soon realised that digging for gold was hard work and feeding hungry miners was a much better business. south of Johannesburg one such restaurant was created..
like the Portuguese explorers of yesteryear. Nandocas are interested in the solution not the problem. They have a sense of pride in everything they do. it you can do it. Experi-perience Life: From the outset. Through these people the Nando's entrepreneurial spirit has become universal. The Nandocas (Nando's people): Nando’s feel so strongly about their people that they have decided to share with people what makes their Nandocas so special: True Nandocas make life happen. justice and good luck. Experi-perience Nando's. The Nando's Barcelos Cockerel can now be found in over 30 countries. But most importantly Nandocas love eating Nando's Peri-Peri Chicken more than life itself. Nando's would be about experiencing great times around the table. courage and integrity spreading the fire and developing a culture unique to Nando's. like the 15th Century Portuguese Explorers. they have fun. Nando's would offer customers a unique Nando's life Experience that was not only about chicken. They create the Nando's culture. They too. and they love the sound of laughter. rewarding work and the good people they met along the way that made it all possible (not forgetting the exceptional Peri-Peri Chicken that everyone loved). The journey continues… It's the people that make the chicken: Nando's would never be just about chicken and it would never be just about the two friends who started it. The entrepreneurial spirit of Nando's soon attracted other people with fire in their bellies. always believing that if you can dream. They. And today the Nando's flame burns bright. Throughout the world Nando's believes in delivering the Nando's Experience albeit in different languages and different surroundings. This experience would be backed up with a Nando's promise of quality. passion. One of the best ways to capture these cultures is having an Institute of Business Management Page 13 of 57 . The Nando’s Escudo was created as the universal mark of Nando's quality. But it was not just good luck that helped them share Nando's with the world. It would be about having fun and never taking life too seriously. Nandocas are team players but are not afraid to be individuals. believed in the legend of the Barcelos Cockerel and its association with faith. These Nando's people are known as Nandocas. it was hard. laughing and living to eat. They make our chicken what it is. They strive to make each customer experience a magical one and they continually search for adventure. They are true to themselves.Strategic Management It was no coincidence that they chose the Barcelos Cockerel as their symbol to identify Nando's around the world. They embraced the same values of pride. They work with the community to make a difference in people’s lives. justice and good luck. believe in faith. proudly feeding the souls and appetites of people hungry for life. A Slice of Life: Allowing Nando's to flourish in each country means embracing cultures of the world.
for the taste as well as the experience. so it followed that our advertising should have a fun and irreverent personality that showed the funnier side of life. Nando's restaurants are known as Casa's. Nando's is the cackle of the land. we encourage noise. The best way to explain our open style of informal restaurants is through the wonderful saying "Mi Casa so casa . Just walk into any Nando's and enjoy the light heartedness of our comfy and warm environment. it is the place to be and to be seen for lunch. We knew our chicken was unique. Institute of Business Management Page 14 of 57 . Our motto is that children should be heard and seen eating. (our aim was to change the way the world thought about chicken). We believe the world will be a better place if everyone has a local Nando's Casa to visit from time to time. For the yuppies and business professionals. Our doors are always open to anyone who wants to taste the Nando's Experience. and a relaxed informal atmosphere from New Zealand to Canada and in between. delicious chicken. medium. we encourage people to use their hands when eating and we encourage family gatherings in the spirit of the good old days. It is our belief that a Nando's feast should be enjoyed in a relaxed environment where the pressures of daily life are left behind. In our restaurants. Walk into any one of our restaurants around the world and you will know you are in a Nando's. Our only table manner request is that people smile and enjoy themselves. that our restaurants were different and that the Nando's experience was magical.My home is your home". You can take the peri-peri experience home with you with our take-away service as well. not because they all look the same .but because the promise of the Nando's Experience is universal. which means "home" in Portuguese. Succulent flame grilled chicken in lemon and herb.Strategic Management open-minded marketing philosophy. Nando's started offering peri-peri casual dining on the 7th May 2001 in Karachi. We have Casa's on five continents around the world and it's our aim and our duty to introduce Nando's to as many people as possible. From the start Nando's have pursued a highly effective marketing strategy which accounts for our phenomenal growth since 1987. hot and extra hot soon became everyone's favorite .they all have their own unique characteristics and design . You will find the same warm friendly service. Nando's restaurants are home to the people who work in them and to our customers.
1. Customers Products or services Markets Technology Concern for survival. 2. growth and profitability Philosophy Self-concept Concern for public image Concern for employees Institute of Business Management Page 15 of 57 .1 Nando’s Vision Statement 'Our vision is to create a successful global brand that can rival the really big brands of the world' 1. 8. 3. people who love to laugh and live to eat. Taste the unique flavor and fire of our Peri-Peri chicken and we are sure you will agree’ 1. 4.2 Mission Statement 1. it is important that it includes all of these essential components: 1. At Nando's we believe in our flame-grilled Peri-Peri Chicken. 9.’ 1.1 Nando’s Mission Statement ‘Devoted to people with an appetite for life.Strategic Management 1.2 Recommended Vision Statement ‘Our vision is to be the first choice in grilled food restaurant business around the globe. 5. 7.2. 6.2 Recommended Mission Statement A mission statement is often the most visible and public part of the strategic management process.1 Vision Statement 1.1. we believe it's the best in the world.2.
’ Institute of Business Management Page 16 of 57 . At Nando's we believe in our flame-grilled Peri-Peri Chicken. who love to laugh and live to eat. through the wonderful saying "Mi Casa so casa My home is your home. we believe it's the best in the world. We believe in offering quality and value to our customers and grow in such a way that creates profitability and value for shareholders and structure the society in such a way so as to improve the quality of life of the whole community.Strategic Management Nando’s mission statement consisted of only 2 components namely: customers and products and services. We aim to be the most successful grilled food restaurant in the world at delivering the best customer experience in markets we serve and to do so. Therefore the recommended mission statement can be as follows: ‘Nando’s is devoted to providing its customers appetite for life. Nando’s will meet its customer expectations through highest quality food prepared with leading technology and by hiring and retaining personnel with exceptional capabilities. Our distinctive competence is our open style of informal restaurants.
insurance or qualifications that are difficulty to obtain? Can the newcomer expect strong retaliation on entering the market? YES (+) ~ NO (–) LOW HIGH Institute of Business Management Page 17 of 57 .1 Porter’s Five Forces Analysis and Industry Applying Porter’s five forces Template to the Restaurant Industry allows us to analyze the attractiveness in terms of profitability of the industry. A THREAT OF NEW ENTRANTS Do large firms have a cost or performance advantage in your segment of the industry? Are there any proprietary product differences in your industry? Are there any established brand identities in your industry? Do your customers incur any significant costs in switching suppliers? Is a lot of capital needed to enter your industry? Is serviceable used equipment expensive? Does the newcomer to your industry face difficulty in accessing distribution channels? Does experience help you to continuously lower costs? Does the newcomer have any problems in obtaining the necessary skilled people.Strategic Management 2. materials or supplies? Does your product or service have any proprietary features that give you lower costs? Are there any licenses. Macro-environmental Attractiveness 2.
increasing their demand and also owning such eat-outs is now very socially appealing thus. Institute of Business Management Page 18 of 57 .Strategic Management Interpretation Threat of Entrants are High and unfavorable in the industry. that is always on the look-out for new and changed places to eat. Thus. Therefore. However. the threat of entrants is high because of increased profit margins in such ventures. In case of improvement in the economy. On Zamzama alone. the threat of new entrants will be high. increasing the threat of new entrants. Every now and then. Social The current social trend is in favor of eating out especially at expensive restaurants. PEST Forces that affect Threat of Entrants Political This can have two extreme effects on threat of new entrants. thereby. more people could afford to go out to restaurants which give more opportunities for new restaurants to come up. Due to its consumer base. the number of unemployed is increasing due to which the labor cost will decrease. out of which only a few are able to successfully survive in the long run. If the government brings out higher restaurant license cost and increased taxes and/or implements strict health and safety regulations along with more documentation procedures. thereby. and the upclass restaurants will be more in demand as the rich are getting richer. a new café or a restaurant opens up. Thus. as that is key to survival in the Pakistani food industry (especially. this will increase the barriers to entry. Technological The rise in innovative technology has made management of restaurants very easy and the new sophisticated software now enable restaurants to run with less number of employees. Economic Due to the rising income disparity and the adverse economic conditions. in the major cities of Pakistan). there are about 20 known restaurants and cafés. this factor increases the threat of new entrants. if the government does the opposite by decreasing license cost and taxes or has a lenient approach to health and safety procedures. reducing the labor cost. This is a real threat in a place like Pakistan where the food industry views constantly changing patterns in demand. Nandos must concentrate its efforts on Differentiation Strategy.
the economic situation of the country brings along adverse effects on the industry. however. each with relatively small purchases? Does the customer face any significant costs in switching suppliers? Does the buyer need a lot of important information? Is the buyer aware of the need for additional information? Is there anything that prevents your customer from taking your function in-house? Your customers are not highly sensitive to price. bank on the rising income disparity. Institute of Business Management Page 19 of 57 . Your product is unique to some degree or has accepted branding. This makes the industry more attractive and profitable and the PEST forces such as increasing population is an appealing opportunity. as it is also a form of entertainment in our country. You provide incentives to the decision makers. Your customers’ businesses are profitable.Strategic Management B BARGAINING POWER OF BUYERS Are there a large number of buyers relative to the number of firms in the business? Do you have a large number of customers. PEST forces that affect Bargaining Power of Buyers Political This political factor has no direct affect on the bargaining power of buyers. YES (+) ~ NO (–) LOW HIGH Interpretation The bargaining power of buyer is low in the industry firstly because their product is a commodity item and consumers have no choice but to continue consumption. Nandos should therefore.
which is increasing the base of consumers. as this industry does not have any real substitutes. their performance is not justified by their higher price. YES (+) NO (–) C THREAT OF SUBSTITUTES Substitutes have performance limitations that do not completely offset their lowest price. thus. Nandos should therefore concentrate their efforts on upgrading their restaurant ambience and the taste offered by them. Technological The advancement in technology makes it possible for the buyer to gather all the information quickly and make informed decisions. Even though the adverse economic situation of Pakistan is reducing the consumer base. Your customer is not likely to substitute. Your customer has no real substitute. The customer will incur costs in switching to a substitute.Strategic Management Economic The increasing population reduces the power of buyers. Or. Social The trend is moving towards eating at restaurants. Thus. food items. because restaurants offer unique experiences along with their basic product i. this is increasing the bargaining power of buyers. it is still not making much impact on the bargaining power of buyers. ~ LOW HIGH Interpretation The threat of substitutes is medium to low.e. Institute of Business Management Page 20 of 57 . In Pakistan. reducing their bargaining power. eating out is a form of entertainment and people generally like going to specific restaurants and cafés because of their splendid experience in the past including ambience and food.
the inputs are usually of a perishable nature.Strategic Management PEST forces that affect Threat of Substitutes There aren’t many substitutes of the restaurant industry. who can provide good quality inputs in a timely manner. My business is important to my suppliers. in order to eliminate this power of suppliers. However. I have many potential suppliers. D BARGAINING POWER OF SUPPLIERS My inputs (materials. etc. labor. PEST forces that affect Bargaining Power of Suppliers Institute of Business Management Page 21 of 57 . This is an unattractive aspect of this industry. stock-ups are not possible. that’s why. If better substitutes are provided to people such as more variety in the ready-to-cook foods could increase the threat of substitutes. services. Therefore. thus. Nandos should integrate backward by probably farming their chicken. Also. decrease in the purchasing power of the people could lessen their visits to the restaurants thereby increasing the threat of substitutes. My cost of purchases has no significant influence on my overall costs.) are standard rather than unique or differentiated I can switch between suppliers quickly and cheaply. My suppliers would find it difficult to enter my business or my customers would find it difficult to perform my function inhouse. YES (+) ~ NO (–) LOW HIGH Interpretation Bargaining power of suppliers is high because the inputs are not easily substituted. I can substitute inputs readily. keeping in mind only those companies in the industries that are rather cautious about their inputs as poor quality inputs can cause them a hefty amount of business. supplies. that is why reliability of suppliers is very important. these companies usually have one or two major supplier of main inputs.
thus enabling more suppliers to come in. My product is complex and requires a detailed understanding on the part of my customer. therefore. thus.Strategic Management Political If the government grants subsidies to other chicken suppliers so that they are able to produce at the same level and with same quality as KnN. the supplier power would go very high since there is only one major chicken supplier. the power of suppliers will reduce. Technological Technology has made it possible to manage the poultry industry. then the supplier power will reduce. It would not be hard to get out of this business because there are no specialized skills and facilities or long-term contract commitments. Social This factor will not affect the input of food industry. The industry is not cyclical with intermittent overcapacity. My competitors are all of approximately the same size as I am. Also our poultry industry is “going down”. E DETERMINANTS OF RIVALRY AMONG EXISTING COMPETITION The industry is growing rapidly. The competitors are diversified rather than specialized. This will further increase the power of suppliers. The fixed costs of the business are a relatively low portion of total costs. etc. the supplier power will increase. Economic The current economic situation of the country will reduce large scale companies such as KnN. YES (+) ~ NO (–) LOW HIGH Interpretation Institute of Business Management Page 22 of 57 . My customers would incur significant costs in switching to a competitor. If the government establishes quality standards for using hygienic meat products. There are significant product differences and brand identities between the competitors.
Economic The fake economic growth has increased the availability of funds. This will increase the rivalry between competitors. Nandos should therefore. Technological Technology has made it possible for competitors to affectively reduce cost. try to combat this issue by increasing their operation via market penetration or market development. Social This factor will not affect the input of the Restaurant Industry. it is usually the restaurants with small operations such as Nandos that suffer. Thus. In such situation. With the increasing rate with which these eat-outs are opening. Unfavorable 7 OVERALL INDUSTRY RATING Favorable Moderate Threat of new entrants 3 2 Implications Threat of new entrants is high Unfavorable Bargaining power of buyers is Low Favorable Threat of substitutes is Medium to Low Somewhat Favorable Bargaining power of suppliers is high Unfavorable Intensity or rivalry is Moderately High Bargaining power of buyers 5 1 4 Threat of substitutes 2 1 1 Bargaining power of suppliers Intensity of rivalry among competitors 1 4 0 0 6 5 Institute of Business Management Page 23 of 57 . the rivalry will increase. the rivalry will increase. each is rigorously competing against the rest. therefore the competitors can match international chains now. enabling to match each other and copy the others competitive advantage. thereby.Strategic Management The rivalry amongst the existing firms is moderate to high as each tries to outdo the other by offering cost-effective deals to the consumers especially during Ramadan. PEST forces that affect Rivalry among existing competition Political If the government grants subsidies to local competitors to match the international chains. Thus. the market share for each of them is deteriorating.
then it would have highly affected Nandos as well. if we visit any restaurant such as Nandos. If the economy develops and more people have the purchasing power. Pakistani people have always loved eating out. Nandos caters to that niche of the Pakistani society that has a relatively higher purchasing power than the majority of the nation. if strategically smart decisions are taken. Government regulations regarding franchises or international chain of restaurants would affect Nandos in relations to itself or in dealing with its competitors. For Nandos. families. Earlier on families would go and eat out. Institute of Business Management Page 24 of 57 . Economic Factors: Pakistan is a developing country and the majority of the population has low purchasing power. couples and even corporate businessmen. but since the past few years. young adults and with corporate people. the recommendations include: • Constantly innovate and bring in more competitive advantage that are unmatchable. we get to see a diverse crowd that includes teenagers. It is even the main source of entertainment in Pakistan.2 Overall Macro-Environmental Pest Factors Political Factors: The political factors that mainly affect Nandos concern how the government relates to health issues concerning food items being served or brings out new regulations regarding the restaurant business. in order to reduce the threat of new entrants. this trend increased even further in teenagers. it is an unfavorable industry as the major cities of Pakistan are swamped with many restaurants and cafes. if the government would have asked for ban on chicken items or some strict regulations on the chicken items being served. Thus eating out is becoming an increasingly important social trend which works positively for places like Nandos. then more people would be able to visit restaurants like Nandos. Nowadays. 2.Strategic Management Unfavorable Total 15 4 23 Reasonably Unattractive Interpretation Overall. Social Factors: The trend of eating out has been carrying on in Pakistan since a very longtime. Thus economic power does affect Nandos as people tend to spend less on eating out at relatively expensive places when they have a tighter budget. For Instance: when Bird Flu occurred in Pakistan. • • Backward integration to reduce the power of suppliers. More effective differentiation to reduce the rivalry between Nandos and competitors. Nevertheless. Any economic instability or economic recession would decrease the power of a lot of consumers. decreasing the niche segment that Nandos caters to. the industry position can be exploited to ones advantage.
Strategic Management Technological Factors: The restaurant business works well where the management handles the service well. Technological developments can competitively produce significant changes in the distribution channel and logistics and reduce the costs in the value chain. More and more restaurants are following this trend and opening up their chains in Pakistan. Nandos is also globally widespread but it hasn’t penetrated much in Pakistan as yet. Nandos has banked on this opportunity by introducing an entirely new concept adopted from South Africa. • Changes in cost and efficiency Institute of Business Management Page 25 of 57 . This does affect the restaurant industry on a whole. • Increasing globalization of the industry Global chains of restaurants such as fast food joints like KFC and Mc Donald’s have existed since a very long time now. 2. Cooking also requires better equipments to work faster and better. The aspect of a global chain leaves a positive impression on the minds of the people since they tend to believe that the product is of quality and hygiene. restaurants need to have better technology. To keep records of dayto-business. • Product Innovation Those restaurants that have had a unique menu or recipe have been able create a strong place in the industry. Nandos has the essential equipment to make all of its flame-grilled items which even works towards providing healthier items by not making deep-fried products. • Technological Change Advances in technology can dramatically transform the restaurant industry. • Entry or Exit of major firms Exit of major firms in the restaurant industry can lead to changes in market shares of all the companies that compete with such firms.3 Key Driving Forces Affecting the Industry • The Internet and new E-Commerce opportunities The Internet can revolutionize the entire restaurant industry by including the aspects of ordering food online. better technology is essentially important. People have always wanted variety in Pakistan. In this way consumers could be provided with more convenience and be more informed about the menus. To be quicker and more efficient in processing and then serving the orders. Entry is relatively easy and keeps on leading to increased competition in this industry. Any new element or uniqueness in a restaurant’s menu could give it a competitive edge in the market.
fastfood places 0.06 0. The trend of eating out has been increasing consistently in Pakistan giving more opportunities for new companies to come with more and more variety for the public.06 0.4 External Factor Evaluation (EFE) Weigh t Rating Weight ed Score Key External Factors Opportunities Market Potential .12 0.08 0.04 0.06 0.09 0.08 0.Strategic Management Decrease in cost can lead to significant changes in the profit margin of the business. 2. • Changing societal concerns.16 0.09 0.24 0.03 0.16 0.05 2 3 3 1 1 2 3 0. attitudes and lifestyles Emerging social issues and changing attitudes and lifestyles can be powerful driving forces of industry change.18 0. However increasing costs can prove to be detrimental to the businesses in the industry.02 0.06 0.17 0.10 0.34 0.growing market for fast casual People's need for variety in the food and entertainmnt sector Rising Demand for Home delivery and Takeout E-commerce People's preference for red meat People's attraction towards promotional offers Increasing trends for business/corporate lunches and dinners Threats Economic Problems in the country Bird Flu Threat Political Problems in the country Growing market for cafes in Pakistan Availability of nandos table sauces in the market Only one chicken supplier (KnNs) Huge variety of Restaurants.12 2 3 2 2 2 2 2 0.08 0.02 0.03 0.24 Institute of Business Management Page 26 of 57 . • Regulatory influences and government policy changes Regulatory influences or policy changes such as increased quality and hygiene standards can drive up costs of firms but would lead to better and safer food items.3 0.02 0.15 0.
18 Nandos. Pakistan’s total weighted score is rather disappointing considering their global background. The strategy for such an opportunity would be to add varieties like fancy beverages (e. Of the threats. cocktails and mocktails).00 2 0.02 2.01 1. They are not exploiting the opportunities in the food industry to their advantage neither are they combating the threats well.34. Institute of Business Management Page 27 of 57 . the way this can be overcome is by establishing subsidiaries under another name. The third biggest threat with a weighted score of 0. Currently their total weighted score of 2. as the trend in Pakistan is moving towards fastcasuals. that needs their immediate attention is the rate with which new restaurants that “Pop-up”. The most major opportunity staring them in the face is the rising market potential which has the highest weighted score of 0. To counter this Nandos must concentrate on increasing its efforts on rightly implementing their Focused Differentiation Strategy. To handle this opportunity they must open up new outlets to cater to the untapped vicinities. They should further enhance their brand image to capture more loyal customers.5.18 is about 20% less than the industry average of 2.16 is that they have only one reliable supplier. sea-food and meat in their menu (available at Nandos outlets in other countries of the world). Another threat which has a relatively high weighted score is the economic problems of Pakistan.3 is the peoples need for variety. they can definitely counter this via backward integration that would include farming their own chicken. Another opportunity that has a high score of 0.g.Strategic Management Changing tastes of people Total Analysis: 0.
05 0.82 Analysis: Nandos is currently being outperformed by its competitor Bar B Que Tonite. technology does not play such an important part in the food industry as evident by its weight. Nandos is doing outstandingly well as far as Product Quality and Hygiene is concerned.15 2 0. Institute of Business Management Page 28 of 57 .06 0. however. their rating on this CSF stems from the strict policy on quality and hygiene of Nandos chain that Nandos Pakistan has to follow.24 0.18 0. Nandos Pakistan also has leverage in technology over its competitors due to global backing that it enjoys.06 0.24 2 2 3 2 2 3 3 3 0.16 0.16 1.2 0. GunSmoke.24 2 0. while Bar B Que Tonite is behind them.1 0.2 0.3 0. work on their pricing strategy and definitely bank on their global position to get a better financial advantage.15 2 0. In Local expansion.18 0.45 1 0.4 0. Nandos is behind both Bar B Que Tonite and Roasters.Strategic Management 3.24 3 3 2 2 4 2 4 2 0.8 0.24 2. Nandos is doing the same as its competitors Roasters.12 0.2 0. this implies that Nandos is not capitalizing on its global strength to expand in the Pakistani market unlike MacDonald’s and KFC. Attention should be given to the price competitive and financial position as Nandos is being out done by Bar B Que tonite in the former.44 2 2 2 1 3 1 2 2 0.06 0.4 0. introducing more varieties in their menu. Nevertheless.24 3.6% ahead of it.3 0.2 0.3 1 0.00 NANDO’S Rating Weighted Score 1 0.20 0.4 0. which is 17. while in the latter.57 BBQ Tonite Rating Weighted Score 3 0.32 0.15 0.12 Roasters GunSmoke Rating Weighted Rating Weighted Score Score 2 0.18 0. Nandos is “slacking off” in its market share. which is one of the most important critical success factors here as compared to competitors Bar B Que Tonite and Roasters.10 0. Nandos has more outlets than the other three companies.08 1.24 0.8 0. Therefore.12 0.12 0. Although.12 0. it is point of Concern as Nandos is a global chain while the other three are local companies of a third world country.24 0. Company and Competitor Analysis 3.05 0.10 0.05 0.6 0.08 0.12 4 4 4 1 3 3 4 3 0.1 0. To improve their competitive position. they should definitely consider opening up outlets in other major cities of Pakistan.1 Competitive Profile Matrix (CPM) Key Success factors Weight Market Share Local Expansion Price Competitiveness Management Financial Position Advertising Technology Customer Loyalty Product Quality & hygiene Employee Productivity Total 0.16 2.
Nando’s believe in maintaining its core competencies in three main areas. Strong Myth and Culture The overall theme of Nando’s is very unique and dipped in the ancient Portuguese culture. It is about having fun and never taking life too seriously. The embarked history and inherited myth of Nando’s gives it a strong believes in its values being delivered through its food. encourage people to use their hands when eating and also encourage family gatherings in the spirit of the good old days. and a relaxed informal atmosphere. Micro-Environmental Analysis and Internal Company Resources 4. captive advertisement and enriching moods spills. 3. full of fun.Strategic Management 4. Peri Peri Sauces The Nando’s true and original recipe of Portuguese sauces has mounted to be its biggest strength all over the globe.1 Core Competencies A competitively important activity that a company performs better than other competitively important activities is termed as core competence. You will find the same warm friendly service. you will know you are in a Nando's. Nando's is about experiencing great times around the table. Whereas. delicious chicken. This experience is backed up with a Nando's promise of quality. 2. distinctive competence is something a company does well relative to competitors. Distinctive Experience Nando's offer its customers a unique Nando's life experience that is not only about chicken. but because the promise of the Nando's Experience is universal. that is: 1. romance flavors. they all have their own unique characteristics and design. Nando’s revolves around a particular theme of cherished life. Institute of Business Management Page 29 of 57 . laughing and living to eat. If you walk into any one of Nando’s restaurants around the world. The secrets of Peri Peri has always created an edge for Nando’s and added value to the over all menu of Nando’s. not because they all look the same. Nando’s encourage noise. In its restaurants.
The chicken is supplied to them by K&N. and ofcourse the essence of the recipe is the sauce imported from South Africa. Nando’s has sold its food directly to final users using the zero level channels.2 Value Chain Peri-Peri Sauces from South Africa Warehouse in Pakistan Restaurant/Retail Outlet Store Chicken from KnN’s Kitchen Ketchup from Knorr Take-Away Fries from McKainz Customer Dine-in Home Delivery 1. Delivery: Since its introduction in Pakistan. which are then trimmed of fat and marinated for 24 hours in their secret Peri-Peri recipe. spices and sauces. extra hot Peri-Peri. or if you are very brave. medium Peri-Peri. They use nothing but the best A-grade chickens. open flame. on a naked. Operations: The unique Nando's method of preparing Peri-Peri Chicken ensures you can eat Nando's knowing you are taking care of your body as well as satisfying your need for taste. Institute of Business Management Page 30 of 57 . The finished product needs to be tasted. to be believed. Import of supply: The main ingredients used at Nando’s are chicken. 2. fries. hot Peri-Peri. the fries by McKainz.Strategic Management 4. allowing the natural flavor and fire to bring out the best in our chickens. During the grilling process the chickens are continually basted in your choice of lemon and herb. the ketchup by Knorr. ketchup. they are grilled to perfection. 3. Never deep-fried.
The servers at Nando’s make extra attraction and retention efforts. These Nando's people are known as Nandocas. Administration: Nando’s is working as a contractual vertical marketing system (VMS). there is an Afrikaans (one of South Africa's official languages similar to Dutch) word called 'Gees'. The Nando's entrepreneurial spirit has become universal. Cooking Sauces and Perinaises. The shift managers are usually the one who get the required training from there and then they give the servers on-job-training. They are taught and educated about the culture and the ‘Nando’s way of life’ While it is difficult to describe the intangible essence of Nando's. For the other two they would need to give them the opportunity to use Nando's Peri-Peri in their own homes. (the g is pronounced with a frog-in-the-throat effect) that is used by Nandocas to describe their 'go for it' attitude that drives everyone at Nando's. now-famous Peri-Peri Sauces. 6. the possibility of conflicts between the marketing channels is low. they have fun. With a VMS. Training: Nando’s trains its employees not here in Pakistan but send them abroad to South Africa. They make the chicken what it is. Nandocas are interested in the solution not the problem. But most importantly Nandocas love eating Nando's Peri-Peri Chicken more than life itself. They are true to themselves. 5. and they love the sound of laughter. Marinades. They create the Nando's culture. They realized that people might only want to eat Nando's Chicken five out of seven days a week. They strive to make each customer experience a magical one and they continually search for adventure. This inspired a range of. meaning spirit. A contractual VMS consists of independent firms at different levels of production and distribution integrating their programs on a contractual basis to obtain more economies or sales impact. Their sauces became so popular they decided to make 4. Service: While the rest of the restaurants in the world may call them waiters. Nando’s call them servers. they were free to unleash the passion and excitement of Nando's Peri-Peri in their own kitchens. When they were not eating Nando's Chicken. Nandocas are team players but are not afraid to be individuals.Strategic Management The success of Nando's Peri-Peri chicken inspired them to bottle up the Nando's passion. enabling people to take the flavor and fire of Peri-Peri home. They work with the community to make a difference in peoples lives. proudly feeding the souls and appetites of people hungry for life. because waiters make you wait and servers serve you. Nando's would never be just about chicken and it would never be just about the two friends who started it. Institute of Business Management Page 31 of 57 .
Raw Material supply constitutes a major portion of their costs since they purchase from the Best Brands available. The servers at Nando’s make extra attraction and retention efforts for which they are rewarded. However the company is still not able to generate as much revenue since they deliver only few items on the menu. The Chicken supplier being KnNs also charges premium price for the high quality chicken that it provides to the company. The import of the peri peri sauces is an integral part of the costs of the company. Nandos does not compromise on compensating its employees. hot Peri-Peri.3 Strategic Cost Management Process Nandos is involved in the following activities: 1.Peri recipe has been adopted from South Africa. This gives the aspect of a healthy product. Any change in the prices of any of the suppliers affects their costs. The chicken is never deep Fried but it is grilled on a naked open flame. or extra hot Peri-Peri. mild PeriPeri. Raw Material Supply The secret Peri. If the petrol prices increase it leads to an increase in the cost of the product. Ketchup is supplied by Knorr and fries by Mckainz. 3. The costs of their salaries are not of very high portion as compared to the material and operation costs. Transportation costs for these raw materials also effects the purchases made. However. They are also trained to better serve the consumers. Nandos has been able to manage their operations costs effectively and efficiently. which are then trimmed of fat and marinated for 24 hours at KnNs in their secret Peri-Peri recipe. During the grilling process the chickens are continually basted in the consumers’ choice of lemon and herb. 2. To further enhance the delivery system Nandos would have to incur further costs to purchase better delivery equipment and be able to deliver more products on Institute of Business Management Page 32 of 57 . The delievery system of Nandos is a new aspect introduced for the company. The costs associated with this process are of the equipment and the basting sauces. This delivery system led to extra costs of delivery boys. Service and Delivery Nandos waiters are known as servers. Operations They use the best A-grade chickens. bikes etc. The shift managers are usually the ones who get the required training and then they give the servers on-job-training.Strategic Management 4. Their marination activity is outsourced which saves them from the hassle of buying the chicken themselves and storing it before and during takes place. They are taught and educated about the culture and the ‘Nando’s way of life’. Water is bottled water by Nestle and the Drinks contract is with Coca-Cola.
The market that it caters to have an inelastic demand which is why even if a small raise in price takes place it would not affect Nandos on a large scale. Institute of Business Management Page 33 of 57 . Nandos can raise its price further with the rise in perceived quality. However if they plan to expand its operations then the company would need to invest in better management systems and skilled staff. 5. The profitability will still be maintained. R & D require high cost but in the long run prove to be an integral part of the company in gaining a competitive advantage. Product launches are not very frequent due to the low R and D budget.Strategic Management the menu. This problem is very much associated with Nandos as well since their systems are not up to date. This would then help generate more revenue and offset the costs associated. Nandos has a very small administrative staff due to the small number of outlets in Pakistan. Administration The administration system of Nandos works at a very restricted level where costs are concerned. In a country where electricity supply is very volatile not having backup systems could cause a lot of mismanagement. R and D The R and D of Nando’s is not very strong in Pakistan. An adequate amount of budget should go to R&D. 4. market researches and development of new tastes and deals based on theses researches. Raised price will cover the rising cost. and high quality will justify high price. To capitalize on the strength of the Peri Peri recipe they need to introduce more products which require them to invest more in the research and development. The Restaurant needs to be innovative and novel in its approach.
5 Star restaurants Low Medium High Overall Cost to the Consumers Institute of Business Management Page 34 of 57 .Strategic Management Type Of Restaurant s Fast Food Kfc. Pizza Hut STRATEGIC GROUP MAP Fast Casual Cafes Gunsmoke Roasters BBQ Tonite Fine Dining Arizona Grill. Mc Donalds. CK.
Their main weakness is their stagnant growth with the highest weight and with only a Institute of Business Management Page 35 of 57 .3 0.15 0.02 0.their Peri-Peri recipe Strong brand personality Ambience at the restaurant Customer Loyalty Marketing efforts towards the consumer base Strong Supplier/Distribution system Products have essential ingredients for a health life Strong Background from Africa present till today Selling Experience Strong food concept Strong Globalize Strategy .10 0.06 0.02 is 20.not strong Weak Technological system in the Administration Department No Beverage Variety Total Weight 0. which they are handling in an average way.04 1.8 0.8% more than the average industry weighted score.03 0.Not penetrated Communication system within dept.05 0.01 0.24 0.16 0. The reason for such a phenomenal score is their PERI PERI recipe which is their main strength with the highest weight.02 4.01 0.00 Rating 4 3 3 3 3 4 2 3 4 3 4 4 2 2 2 1 2 Weighted Score 0. marinating and table sauces are usually the most important ingredients and they are definitely quiet effectively banking on this strength.02 0.02 0.07 0.04 0.06 0. it has a low weight considering the psyche of Pakistanis. Their delicious basting and marinating sauces still remain a mystery to the rest of the world.06 0.adaptive to culture Creative and unique Menu Weaknesses Low Marketing Budget Stagnant Growth .04 0. Along with this.04 0.4 Internal Factor Evaluation (IFE) Analysis: The total weighted score of 3. although.05 0. they are handling all their strengths really well with the exception of their healthy ingredients. Basting. they are very poorly countering their weakness.02 0.16 0. On the other hand.08 3.Strategic Management Key Internal Factors Strengths Product .08 0.15 0.21 0.08 0. they can definitely improve their score by communicating the nutritional values of their ingredients.04 0.08 0.15 0.20 0.4 0.
This will also attract more customers from upper-middle/high class. this is in line with their current strategy. Pakistan.Strategic Management sore of 2. Institute of Business Management Page 36 of 57 . like Islamabad. where mostly the rich and the influential reside.1 Generic Strategy Although. The strategies to improve the growth rate would include market development and product development via establishing more outlets and increasing the variety in their menu. They should definitely improve their growth rate and try to improve their marketing budget. Another contradiction in this strategy is that there is no outlet in Islamabad. Nevertheless. Nandos Pakistan caters to that Niche market which requires a different taste and value and is prepared to pay the price for it. they haven’t really implemented it that well. This will definitely enhance their total weighted score. They should really check their strategic approach or correct their focus. 5. Their focus is entirely on the Upper Middle and Upper-Upper class. Strategic Analysis and Recommendations 5. The company needs to make effort in targeting and communicating their real value to its specific set of consumers. Nandos Pakistan claims to be following a Focused Differentiation Strategy. respectively. There is no evidence. Now is the time to really bank on the rising income disparity in the economy via increasing their prices. as it is quiet socially appealing for them to dine at expensive places. The strategies implemented by Nandos have not exactly catered specifically to this focused differentiation strategy. Nandos offers only chicken items. that they are willing to do anything about it as their outlets are still missing in the major cities of Pakistan.
Strong brand personality 3.1 TOWS Strengths ------. Effectively communicate their niche marketing strategy to their target audience to further emphasize what their brand actually stands for. (S1 S2 S6 S7 S8 S9 S10. Ambience at the restaurant 4. O3) Use the latest technology to Deliver further hot as well as cold items on the menu 6.2 Input/Matching/Decision Model 5. Weak Technological system in the Administration Department 5. deals. Add value by offering an outstanding service which is unforgettable and unmatchable. Strong Globalised Strategy adaptive to culture 12. Marketing efforts towards the consumer base 6. Products have essential ingredients for a health life 8. No Beverage/Soup Variety Opportunities ------. (S1. O 4 O6) Create Weaknesses ------. Market Potential . Commmunication system within dept. The following strategies have recommended for improving their strategic position: • • • • Increase their prices to capture a larger share of their current target market.O 1. People's attraction towards promotional offers 7. O6 O7) Bring up promotional offers like coupons.2. O4) Create a website and use it as a medium of advertising 2. O2) Introduce beverages and other food items to cater to the growing needs of the people Institute of Business Management Page 37 of 57 . O6 O7) Advertise their existing products more to attract consumers 4. Creative and unique Menu SO Strategies 1. (W2. O1 O2 O5 ) New product launches such as red meat and vegetable products 2. corporate discounts etc.Not penetrated 3. E-commerce 5. (S1 S2 S5 S7. (S1 S10. Strong Background from Africa present till today 9.not strong 4.S 1. Selling Experience 10. Low Marketing Budget 2. 5. Rising Demand for Home delivery and Takeout 4. (W1 . Customer Loyalty 5. People's need for variety in the food and entertainment sector 3. Strong Supplier/Distribution system 7. (S2 S5. (S2 S5. O1) Penetrate into more cities of Pakistan 3.Their Peri-peri recipe 2. Product . People's preference for red meat 6.W 1. Stagnant Growth .growing market for fast casual 2. Open up outlet in the major cities of Pakistan like Islamabad and Faisalabad. 5. Strong food concept 11. Increasing trends for business/corporate lunches and dinners WO Strategies 1.Strategic Management Nandos should stick to its focused differentiation strategy. O1) Open up Outlets in Existing and Other Cities such as Islamabad 3. (W5.
Availability of nandos table sauces in the market 6. the highlighted strategies are the best and most applicable to enhance the overall position of Nandos. Economic Problems in the country 2. Growing market for cafes in Pakistan 5. Changing tastes of people ST Strategies (S1 S10. Institute of Business Management Page 38 of 57 . T6) Integrate backwards and maintain own chicken farm WT Strategies (W3.T4 T7) Up date your internal technological systems to be at par with the other restaurants (W5. while the opportunities and threats have been explained in the EFE matrix.W4. Only one chicken supplier (KnNs) 7. weakness. Note: All these strengths and weaknesses have been explained in the IFE matrix. outstanding global brand name) and opportunities (such as growing market for fast casual.T 1. people’s need for variety and red-meat) and with weakness (such as stagnant growth. Bird Flu Threat 3. low marketing budget) and threats (such as increased variety of restaurants. Political Problems in the country 4. T4 T7) Open up new outlets in Pakistan using you product advantage to be widespread and be well known. Huge variety of Restaurants. Backed by their strengths (secret Peri-Peri recipe. one chicken supplier and economic problems in the country) facing them. fastfood places 8.Strategic Management an Attractive and Interactive Website for the consumers of Pakistan Threats ------. (S6. T4 T7) Use your advertising to attract consumers towards your restaurant (S1. T2) Launch red meat or sea-food products (S5. T7 T8) Introduce variety of Beverages to cater to the changing tastes of the people Analysis: The highlighted strategies are the best and most applicable to enhance the overall position of Nandos as they effectively handle the important strengths. opportunities and threats.
8 -1 best to –6 worst 3+ (-2.8 5 4 3 5 5 3 Average score Competitive Advantage Customer Loyalty Techonlogical Know How Capacity Utilization Local Expansion Product Quality Employee Retention Cost Competitive Average Score 3 -2 -2 -2 -5 -2 -1 -4 -2.2.17 Y axis Financial strength 3 +1 worst to + 6 best Y axis: Environmental stability -2.Strategic Management INTERNAL STRATEGIC POSITION Financial Strength Return On investment Leverage Liquidity Working Capital Cash Flow 4 3 2 3 3 EXTERNAL STRATEGIC POSITION Environmental Stability Technological Changes Demand Variability Competitive Pressures Price Range of Competitive Products Economic Tension Political aspect Average Score Industry Strength Growth potential Profit Potential Financial Stability Technological know how Resource utilization Capital intensity -2 -4 -5 -3 -2 -1 -2.17 1 worst to 6 best X axis: Competitive advantage -2.2 X axis Industry strength 4.2 SPACE Matrix Institute of Business Management Page 39 of 57 .57) = 1.17 + (-2.57 -1 best to -6 worst 4.57 Average Score 4.6 5.8) = 0.
However. their political aspect and economic aspect are not very good. The environmental stability is slightly below average and considering the current situation in Pakistan. Provided that the company is in the right strategic direction. As far as. On the x-axis. environmental stability is concerned. • Product Development: Upgrading their services. Institute of Business Management Page 40 of 57 . The local expansion factor has the worst score which can be overcome through expanding in other cities of Pakistan. it will see profit margins very soon through association with this industry. adding more facilities at the outlets such as play area. adding new product variety in chicken or launching meat or sea-food products. we find that their financial position is just average as not much revenue has been generated in Pakistan as yet. the industry strength saves their day as this restaurant industry has a lot of growth potential. Competitive pressures are high. The following strategies can come in very handy to better their position: • Market Development: This can be achieved through opening of outlets in other cities of Pakistan. Innovation and communication of its value is the key here to enhance their competitive advantage.Strategic Management FS Conservative +6 +5 +4 +3 +2 +1 Aggressive CA -6 -5 -4 -3 -2 -1 -1 -2 -3 +1 +2 +3 +4 +5 +6 IS Defensive -4 -5 -6 Competitive ES Analysis: Nandos currently falls in the aggressive quadrant of the space matrix. they should bank on the opportunities facing them to the maximum. starting with the big cities and then moving on to other cities if feasible. while effectively countering their threats. their competitive advantage is average for which they need to pay attention to their cost competitiveness. Upon further analysis.
• Market Penetration that could be done by opening up more outlets in current cities being catered that is Karachi and Lahore.0 to 2. which is a rather lucrative industry.0 to 1. • Diversification: Although.0 3.0 3.0 to 1.0 Medium 2. This quadrant is the “Grow and Build Quadrant” which suggests that Nandos needs to build and grow its current position.0 4.99 1. It could also be done by Nandos catering to lower end of the market under a different brand name. 5.0 High 3. Horizontal integration could be achieved by merging with similar fast casual restaurants to better enhance their capabilities. The strategies in this quadrant include: • Market Development which can be achieved via opening up in cities like Islamabad. Nandos with a strong internal position and a medium EFE score is now in the 4th quadrant.0 Weak 1. They can further diversify by getting involved in the entertainment industry.3 Internal External (IE) Matrix The IFE Total Weighted Scores Strong 3.99 2.Strategic Management • Market Penetration: Opening more outlets in existing cities: Karachi or Lahore • Backward and Horizontal Integration: Moving backward as well by owning quality farms that enhance their strength of “Products have essential ingredients for a healthy life”.0 to 4.0 The EFE Total Weighted Scores Analysis: In IE Matrix.99 2. Institute of Business Management Page 41 of 57 . • Product development via variety to their menu and upgrading their service.99 1.0 Low 1.0 to 4.0 Average 2.0 to 2. according to the current trends as there aren’t many entertainment outlets in Pakistan. they are slightly diversifying by catering to the retail market via selling their table sauces at the retail stores.2.
they can penetrate the market by opening up subsidiaries to cater to the lower end of the market. It can also carry out market development by opening up outlets in other cities of the country. 5. To enhance their strategic outlook as per their position in the first quadrant. Another thing they can do is product development via enhancing their quality of service. Currently.Strategic Management • Integration including Forward. In case of Nandos only Backward and Horizontal Integration makes sense. Nandos should concentrate on aggressively advertising to communicate the real value of the product to the consumer. this will also reduce their supplier’s power over them. Backward and Horizontal. add features to their chain of restaurants e.g.2. Secondly. Nandos needs are doing alright as compared to its competitors. Nandos can also integrate with their competitors (horizontal Integration) to reduce their competition and increase their consumer base. They definitely backward integrate by farming their chicken.4 Grand Strategy Matrix Rapid Market Growth Quadrant I Quadrant II Weak Competitive Position Quadrant III Quadrant IV Strong Competitive Position Slow Market Growth Analysis: Nandos falls in quadrant 1 since it has a strong competitive position through its Peri Peri Recipe which no other restaurant offers and the restaurant industry is a fast growing market. Institute of Business Management Page 42 of 57 . under a different brand name. kids play area and/or add more variety in their current menu. the reason it is slacking of is that Nandos is not communicating the value to the consumers.
2.5 Matrix Analysis and SWOT Summary Alternative Strategies Forward Integration Backward Integration Horizontal Integration Market Penetration Market Development Product Development Concentric Diversification Conglomerate Diversification Horizontal Diversification Joint Venture Retrenchment Divestiture Liquidation IE X X X X X X SPACE X X X X X X X X X GRAND X X X X X X X COUNT 3 3 3 3 3 3 2 1 1 5.6 QSPM Institute of Business Management Page 43 of 57 .Strategic Management 5.2.
03 1.2 0.05 0.Strategic Alternatives MARKET BACKWARD PRODUCT DEVELOPMENT Management Strategic INTEGRATION DEVELOPMENT Open Outlets in for meat products New Product New Geographic Launches Regions Strengths Product .00 2 4 3 1 3 3 0.02 0.08 0.05 0.97 4 4 1 4 1 1 0.1 AS 4 4 3 2 3 4 3 2 4 3 TAS 0.10 0. fastfood places Changing tastes of people TOTAL Institute of Business Management SUM TOTAL ATTRACTIVENESS SCORE Weight 0.06 0.01 AS 4 4 4 3 2 4 3 2 3 2 TAS 0.05 0.2 0.48 0.08 0.02 0.24 0.16 0.16 0.2 0.15 0.12 0.adaptive to culture Creative and unique Menu Weaknesses Low Marketing Budget Stagnant Growth .1 3.06 0.02 0.14 1 1 4 3 1 0.18 0.58 3 2 4 1 4 1 0.08 0.47 0.03 0.03 0.3 0.2 0.06 0.14 0.1 0.12 0.03 0.72 0.21 0.1 0.growing market for fast casual People's need for variety in the food and entertainment sector Rising Demand for Home delivery and Takeout E-commerce People's preference for meat People's attraction towards promotional offers Increasing trends for business/corporate lunches and dinners Threats Economic Problems in the country Bird Flu Threat Political Problems in the country Growing market for cafes in Pakistan Availability of Nandos table sauces in the market Only one chicken supplier (KnNs) Huge variety of Restaurants.09 0.28 0.28 0.28 0.04 0.36 0.05 0.03 1.28 0.04 0.03 0.02 0.3 0.15 0.06 0.08 0.2 2.3 3 2 4 - 0.15 0.07 0.72 0.92 4.05 3 4 4 - 0.15 0.10 0.08 0.03 1.15 0.Not penetrated Communication system within deptnot strong Weak Technological system in the Administration Department No Beverage/Soup Variety TOTAL Key External Factors Opportunities Market Potential .24 0.09 1.66 3 4 4 3 2 0.32 0.15 0.6 0.45 0.28 0.15 AS 1 2 1 1 1 4 4 2 2 2 TAS 0.08 0.08 0.04 0.00 3 2 4 3 4 0.05 1.12 0.07 0.18 0.Their Peri-peri recipe Strong brand personality Ambience at the restaurant Key Internal Factors Customer Loyalty Marketing efforts towards the consumer base Strong Supplier/Distribution system Products have essential ingredients for a health life Strong Background from Africa present till today Selling Experience of many Decades Strong food concept Strong Globalised Strategy .6 0.08 0.27 .18 0.8 Page 44 of 57 5.05 0.45 0.15 0.1 0.3 0.14 0.21 0.4 4 3 3 - 0.07 0.06 0.05 1.32 0.03 0.08 0.04 0.16 0.08 0.12 0.01 0.12 0.03 0.11 3.
it has an attractive score of 1 i.Strategic Management Analysis: After strategically analyzing the alternatives. as the rich.07. This will definitely uplift the international chain image of Nandos if it opens up in cities like Islamabad and Faisalabad along with countering the threat of economic problems in Pakistan. Therefore it lost out on the most important factors. we find that the most attractive strategy is the second strategy that is Opening up of outlets in new geographic regions. as it barely capitalizes on this particular element. as this strategy will enable better supply management while facing these two threats. namely one major supplier of Nandos and the economic situation in the country than the other two alternatives.e. Strategy 3: This strategy of backward integration received the worst score because on the most important strength of their peri-peri sauce.15).12). along with losing on other relatively less important strengths. The reason as to why such is the case is explained below. it is better at combating two important threats. weakness. Strategy 1: A close competition of strategy 2.growing market for fast casual (has the highest weight of 0. With threats such as growing cafes in Pakistan. fast food places (highest weight of 0. along with combating the threat of Huge variety of Restaurants. Institute of Business Management Page 45 of 57 . will give Nandos less economic loss due to strikes. Of the weakness. riots. The only strength that this strategy is more useful for is “Products have essential ingredients for a healthy life” than the alternatives is one with lowest weight due to its relative importance. it is must that Nandos aggressively opens up outlets so it is in the consumers’ face. also while handling the opportunity of Market Potential . Nevertheless. These cities also have better political conditions. diplomats and industrialists reside in such cities. thus. opportunities and threats. Strategy 2: This is the most effective strategy as evident by the total attractive score as their main weakness is the stagnant growth along with a very important opportunity of great market potential for fast casual restaurants. it is not at all attractive relative to the other strategy. while it is only better than opening new outlets in other geographical areas in the opportunity: “people’s preference for meat” which has a relatively low weight of 0. the other two are better at countering the weaknesses. the reason why this strategy has received a lower total attractive score is that it is relatively less effective while countering the weakness of “stagnant growth” (which has a high weight of 0. etc. influential politicians.15). than STRATEGY#2.
Keeping our strategy of following focused differentiation. Strategy Implementation Implementing and executing strategy entails converting the organization’s strategic plan into action and then into results. The finest chicken from KnN’s and the imported high quality ingredients do not allow Institute of Business Management Page 46 of 57 . that is its marinades. achieve continuous improvement in business processes. Building an organization with Competencies. The goldilocks of unique advertising and symbolic representation of the myths add strong hold of the organizational expertise in translating its culture to its operational activities and in brand transformation. develop core competencies. Implementing strategy is primarily an operations driven activity revolving around the management people and business processes. through which Nando’s is capable of importing its main constituent of the recipe. the company can articulate at by translating the corporate culture into the administrating activities. can be implemented through following ways: 6. motivate people. Capabilities and Resource strengths to carry out the strategy successfully: Nandos expertise in Peri Peri sauces and for grilled Chicken serves as its strength that a company is fairly good at doing and that enhances its competitiveness. make-things-happen task that tests a manager’s ability to direct organizational change. Nando’s has a wide worldwide distribution and supply chain network. build valuable organizational capabilities.1 Components of Strategy Implementation Nando’s should take into consideration the below discussed components in implementing the strategy. create a strategy supportive corporate culture. the most recommended strategy appeared is of market development through opening of various outlets in different geographical regions. 1. and also the chicken from its sole supplier KnNs’. The forwarded myths and strong culture of Nando’s is it’s another strong competency. Executing strategy is action-oriented.Strategic Management 6. and meet or beat performance targets. Putting a strategy into place and getting the organization to execute it well call for different sets of managerial skills.
This shall also inculcate to drive from audio and print marketing to media advertisements. Nando’s will have to have efficient budget in hand so as to align their budget with strategy. with respect to the recommended strategies of product development and market development. Developing Budgets to steer ample resources into those value chain activities critical to strategic success: New strategies require significant budgets. by not just promoting few of it products at an interval basis to the set of products marketed to the masses. Nandos should provide proper training to it workforce consistent to its lively and energetic culture. Therefore. communication. The market development strategy would subsequently increase their distribution costs and also the product development would mean buying sea food and meat which would additionally increase the supplier costs. In order to implement new strategies such as product development and market development. fresh and young workforce. Firstly. Nando’s still experience communication gap and dispersed functional activities. 3. Despite of the limited number of workforce. and operating system that will enable company personnel to carry out their strategic roles day in and day out Institute of Business Management Page 47 of 57 . infact they can directly import the chicken marinated in the Peri Peri sauces. Nandos needs to increase its budget. Instituting best practices and pushing for continuous improvement in how value chain activities are performed Nando’s can improve on its value chain activities by implementing the strategy of backward integration which would help Nando’s drive the costs out of the value chain. Establishing strategy supportive policies and procedures Nando’s need to stabilize its strategy in two important areas of concern. Installing information. Though being a global company the resources of Nando’s are not equally or substantially granted to the local franchisees to develop and implement strategies bringing higher initial costs to the company. Nando’s also needed to revise its policies regarding the internal communication of the organization. Therefore. This shall in long run will cause the company to drive costs out of its value chain. 2. and will led all the Nando’s global franchisee’s import chicken from one place. 5. Nando’s need to expand its budget for its marketing and promotional activities. Although Nandos have pool of talented. not integrated properly. Moreover. under the specialized supervision of the Nando’s at South Africa. yet they lack energy and risk taking capabilities. Nando’s can do so by initiating its own poultry farms in South Africa in this way Nando’s would not require to import the sauces and the marinades.Strategic Management Nando’s to compromise at the quality dine. E-commerce. which can be used to strengthen the differentiation element for the Nando’s. 4.
Exerting Strategic Leadership Nando’s strategic leadership is only possible with a strategic mind on the top. Despite of being a global company. 6. accepted culture. Tying Rewards and incentives to the achievement of performance objectives and good strategy execution It is essentially important that the base of the rewards and incentives shall lie on the performance of the employees. lack of technical upgradation and absence of local Nando’s website is another area of concern. and lucrative environment to work at. But this culture is limited more towards literate values and publications in Nando’s Pakistan than practically adopted and implied. and perceptions. communication. Nando’s should hold its key strength of unique culture and the energy flowing from the Portuguese times. One very important aspect of instilling a cultural change is that it should be more than cosmetic. and which requires fair reward system to attract and motivate employee for the achievement of performance.Strategic Management Nando’s is weak at its internal administrative infrastructure. The unique and energetic culture possessed by Nando’s gives it a unique strength which is hard to compete at. and such actions must be indicative of the management’s commitment to new strategic initiatives and associated cultural changes. The easiest method is to engineer some quick successes that highlight the benefits of strategy-culture change. and e-commerce also. Success of an organization depends upon the sailor who boats the voyage through strong values. i.e. Moreover. Creating Strategy Supportive work environment and corporate culture Nando’s passed on culture is very strong that depicts their beleives. risk-taking mind set. The communication gap also plays a worrying role by hindering a strong corporate integrity. The strategy thus requires the good workforce to implement it. In order to finely execute the recommended strategy of product development and market development. and vigorous moves to Institute of Business Management Page 48 of 57 . it has to be complemented by actions and real movement. values. Nando’s weak infrastructure hurdles in the administrative role of the company and hinders in delivering the effective results within the internal environment. Nando’s can work over all these three basic factors to strengthen its day to day operations to achieve effectives and efficiency of work. thus making enthusiasm for the changes contagious. 8. 7. An attractive and lucrative reward system not only motivates the employees towards optimum performance but also attract the talented workforce. and translate them into the strong corporate culture.
Business Process Perspective: To satisfy our shareholders and customers. In order to implement. Customer Perspective: To achieve our vision. To grow revenues 2. Strategic performance measures are used to better inform decision-making and show progress toward desired results. and employees.Increasing ROI Initiatives Opening outlets in Islamabad and Faisalabad along with opening more outlets in Institute of Business Management Page 49 of 57 . Capturing more urban markets 2. the corporate culture should be flatter with functional group and a strong leadership of CEO. stakeholders. desired employee behaviors. working from four perspectives: 1. how should we appear to our shareholders? 2. how should we appear to our customers? 3.Increasing revenues by 20% by the end of 2008 2. Learning and Growth Perspective: To achieve our vision how will we sustain our ability to change and improve? Each of these perspectives is evaluated through objectives. to identify problems. To increase profits and ROI Measures 1. A completed scorecard system aligns the organization’s picture of the future (shared vision).2 Balance Business Scorecard The balanced scorecard is a strategic planning and management system that helps everyone in an organization understand and work towards a shared vision. Mangers needs to assimilate the best possible information. 6. Since Nando’s have a small workforce operating Nando’s in Pakistan. targets and initiatives. measures. The organization can then focus on the most important things that are needed to achieve its Vision and satisfy customers. Nando’s need to have a leader with more of the risk-taking and managing capabilities. with business strategy. The Balance Scorecard is a strategic approach and performance measurement system that enables organizations to translate a company’s vision and strategy into implementation. so that it is implemented correctly and consistently across the organization. Financial Perspective: To succeed financially. Financial Ratios And Trend Targets 1. and day-to-day operations. research work and study. and creating a competitive edge. the recommended strategy. open to experiences and positive to the challenges. Objectives Financial 1. It is the leader who creates power and force that constitutes strategy. what business processes must we excel at? 4.Strategic Management implement the documented plans that matches with the consistent and future customer needs. provide conformity that the actions undertaken in the execution of the strategy are in the right direction and learn what obstacles lie in the path of good strategy execution and develop a basis for determining what can be done to remain competitive.
Moreover. More product Research and Development 3.Pool of energetic and risk taking workforce 2. Cultural Transformation Financial Perspective Nando’s foremost objective in terms of financial perspective is to increase its revenues and ROI. Stadium Road. and Sharah-eFaisal. Introducing Brand Loyalty Cards 1. despite of expected substantial revenues. Extent of Global culture adoption Learning and 1. Therefore. The financial ratios and trend analysis can further measure the success of the objective attainment at the end of the operating year. Sales of brand loyalty cards by 10% by end 2008 1.Adopting dynamic. energetic and risk taking culture 1. Infusing global culture.Participation in Decision making 2. though we can target good revenues from the new geographical regions. Stabilizing delivery networks 2. Since Nando’s target niche market of upper-middle and upperupper class. Repeated customers 1. Also since it shall take sometime for Nando’s to develop its market in Islamabad and Faisalabad. Training of employees 2. Backward Integration 1.Accelerate R&D role 3. Nando’s can open up their outlets in these cities and can develop their market in new geographical regions thus increasing revenues. Nando’s can also expend its number of outlets in Karachi. Attract and retain more customers 2. Driving costs out by 40% Karachi 1.Stabilizing market for business executives 3. Initiating poultry farms in South Africa 1. such as in Islamabad and Faisalabad. Measuring demand for new products 3. Boat Basin. and the targeted ROI from these regions shall remain comparatively low than the already operating outlets and new outlets in Karachi.Increase brand loyalty 1.Strategic Management analysis by 15% by end of 2008 1. Dealing with one supplier for sauces and chicken 1. Increasing sales volume by 35% by end of 2008 2. especially in areas where it can find its potential market such as Zamzama. opening outlets at corporate localities will benefit Nando’s with more revenues and thus increased ROI. the measurement of these financial objectives can be made through capturing new urban markets in Pakistan. the total contribution to ROI shall not be very attractive from these new regions for the next 7-8 months.Introducing more variety based menu 3. Customer Perspective Institute of Business Management Page 50 of 57 .Training and developing Growth employees 2. Introducing new and improved products 3. Since a bigger proportion of revenue is generated from the business executives. the new geographical regions may not be able to reap greater ROI for the company.Increased customer database 2. Customer Internal 1.
The attainment of these objectives can be measured through increased customer database and repeated customers walking in the outlet. buying expensive chicken from KnN’s and paying extra for marinating that chicken costs a high amount to Nando’s . The chicken imported shall be already marinated into Peri Peri secretive sauces and Nando’s Pakistan can simply import the marinated chicken from South Africa. and buying chicken from KnN’s. The organization shall pay for 20x 50 dines at one point of time. The majority of the customers walking into Nando’s are business executives coming for lunch. Internal Perspective Nando’s can exercise backward integration by initiating its own poultry operations through farming chickens in South Africa. where these sauces are send to be marinated. This whole process of importing sauces. that allows 50 dines on a single card. thus increase in revenues for the company. and award them at their performance measurement. Nando’s need to put great emphasis on the training and development of the employees in managing these objectives and to further training the new hired employees in accordance to the increasing Institute of Business Management Page 51 of 57 . free from bird flu endangers. the uncertain economic conditions of Pakistan regarding Bird Flu also have adverse affect over the sales of Nando’s. These cards can be bought by the organizations to use them as a short term reward or as a means or appreciation for the employee. This method is effective to increase the sales. it can firmly constitute its objective of attracting and retaining customers with respect to the customer perspective. Currently Nando’s is importing its Peri Peri and other main sauces from South Africa. Moreover. Another initiative that can be taken to attract and retain customers is through more variety based menu. and can refrigerate it at their respective outlets. Moreover. This will require Nando’s to introduce new products and beverages. This grants a good market to Nando’s for stabilizing the market for the business executives through Nando’s Loyalty Cards. and creating more demand for the Nando’s Loyalty Cards. This will give advance revenues for the company that is before a sale was actually made. attracting business executive. Nando’s Loyalty Cards Nando’s loyalty cards are the premium corporate discount cards. The whole process can drive out the costs on an estimation of 40%. resulting diminishing profit margins.Strategic Management Since Nando’s is opting for market development. valid for 6months at a discounted price. Nando’s can make its delivery network more effective and strong to meet the needs of the corporate and regular customers. This can be rectified by importing chicken from Nando’s own farms under the hygienic processing. having vast cost reduction in supply chain process. The minimum number of cards an organization can purchase shall range from 15-20. Learning and Growth Since the strategies proposed and the objectives undertaken revolves around the market and product development.
and market downturns. Subtotal of execution score Primary and Secondary Superior 4 5 Inferior 1 2 Average 3 9 Inferior 1 Average 3 Superior 4 5 2 13 Institute of Business Management Page 52 of 57 . introducing new and improved products and exercising cultural transformation. Diagnostic Survey of Management Practices STRATEGY The company has a clearly articulated and widely understood strategy. These objectives can be achieved through more product research and development. Also since. The company’s programs and initiatives consistently achieve desired outcomes. Nando’s is recommended for product development. The company consistently improves employee productivity. The company is focused on extending/improving its core business or businesses and is committed to growing them aggressively.Strategic Management operations in various regions. 7. The company’s IT systems enhance its ability to execute its value proposition. energetic and risk taking culture to encourage the workforce move vigorously in implementing the strategies and taking and managing calculated risks in market development process. emerging opportunities. another objective of Nando’s shall be to accelerate the R&D activities in introducing new products. The company has strong external antennae and quickly anticipates external shocks. for a variety based menu. Nando’s shall also require to focus its targets such as generating a pool of energetic and risk taking workforce. The company has a very good understanding of its competitors and can anticipate competitor’s moves. Subtotal of strategy score EXECUTION The company’s product’s and services consistently meet customer expectations. training employees and infusing global culture in Nando’s Pakistan. Moreover. the company needs to exert a dynamic.
The company designs jobs that intrigue and challenge talented employees. The company’s business processes are simple. The company‘s board members know the business and have a significant stake in Inferior 1 2 Inferior 1 2 13 Average 3 Superior 5 4 8 Average 3 4 Superior 5 Institute of Business Management Page 53 of 57 . The company effectively cooperates across the organization. Subtotal of organizational structure score: TALENT The company has great “talent” and “bench strength” at each position. People at all levels of the organization feel connected to the CEO. The CEO matches words with actions (“walks the talk”). Subtotal of culture score ORGANIZATIONAL STRUCTURE Inferior 1 2 Average 3 Superior 4 5 Inferior 1 2 13 Average 3 4 Superior 5 The company makes decision quickly. The company’s culture is exciting.Strategic Management CULTURE The company sets demanding performance standards for all of its employees. The company has clear values that people in the company can abide by. Subtotal of talent score: QUALITY OF CEO/BOARD LEADERSHIP The CEO is uncanny at spotting opportunities and problems before others. The company consistently raises the performance bar. The company‘s senior management is personally involved in recruiting and developing talent. The company successfully develops talent. The company minimizes bureaucracy. engaging and fun.
Subtotal of CEO/Board score: INNOVATIVE CAPABILITY The company is continually transforming or reshaping its industry. The company does not hesitate to cannibalize its existing business or businesses. Subtotal of CEO/Board score: Inferior 1 2 13 Average 3 Superior 4 5 10 Total Score: 79 Institute of Business Management Page 54 of 57 . People who have new ideas are respected and enjoy high status in the company.Strategic Management the success of the company. The company’s product’s. devices or innovations are better than those of its competitors.
Therefore. Execution The customers at Nando’s expect the same quality grilled food. Strategy Nando’s customers want it to open up outlets in Islamabad and also in more locations in Karachi. Nando’s should also fine tune its strategy based on the changes that take place in the marketplace. Nando’s should put the decision making authority close to the front line employees so that they are better able to react to the changing market conditions. fun and energetic environment and efficient service whenever they come to Nando’s anywhere in the world. Rewards don’t Institute of Business Management Page 55 of 57 . The entrepreneurial spirit of Nando's can attract talented people. In the same way. Similarly. Therefore the people at Nando’s should embrace the same values of pride. Also. Nando’s should also improve its productivity at a rate that is roughly twice the twice the industry average. so that the employees keep on improving their performance. Nando’s should stay focused on its strategies. the customers want more variety in the menu. To do so. 3. the strategy also needs to be communicated to customers and also to the employees within the organization. To do so. Making 4 + 2 Work for Nando’s A list of behaviors that can support excellence in of the management practices are outlined below: Primary Management Practices 1. Nando’s should build a strategy of market development and product development around what the customers really want. courage and integrity. Simply coming up with a new strategy doesn’t work. 2. Culture Nando’s culture is an entrepreneurial culture which means that it should encourage energetic. dynamic and risk taking culture. Nando’s should also empower its employees to make independent decisions so that they themselves are able to find ways to improve operations.Strategic Management 8. passion. Nando’s should continuously reward the high achievers within the organization and at the same time keep raising the performance bar.
therefore. Institute of Business Management Page 56 of 57 . Furthermore. This would further reduce bureaucracy. by designing jobs that challenge the best performers and keeping the senior management involved in the selection and development of people. Since Nando’s culture is an entrepreneurial culture. Talent Nando’s does have a lot of young employees. Nando’s can do so by promoting cooperation and exchange of information across the whole company. it should create a challenging and satisfying work environment. Nando’s need to enhance all its operating processes. Secondary Management Practices 5.Strategic Management necessarily mean financial rewards. Structure The structure of the company should be such so that it reflects simplicity in which it’s easier to work in and with the organization. Innovation Nando’s seriously needs to come up with more new and innovative products. they can also be psychological ones. 6. creating and maintaining effective training and development programs. 4. Also. it should not hesitate to cannibalize existing products. It can hold on to talented employees and develop them more by filling mid and high level jobs with outstanding talent. Also. Also. Nando’s should create an environment where its people abide its core values.
Strategic Management 9.nandos.com Institute of Business Management Page 57 of 57 . www. References 1.