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Pacific Brands: Rebuilding the Brand 1. Key Stakeholders (3.

9) Key Stakeholder Shareholders Stakeholders Objectives Increase in Revenue Shareholder Return. Objectives Met/Not Met Increase in earnings by 30%Met Investors had their dividend in the first halfMet Running into losses, lost its name- Not Met As the company has sold off its many brands so reduction in market shareNot Met After drastic losses theres little relief and there is an increase in EBITDA- Met Good strategies help the company in recovering from losses- Met Lots of employees were

CEO and Board

Prestige Increase in Market Share

Revenue and Profit Growth

Strategic Transformation Success


Jobs protection

Earnings and Taxation

Major customers

Effective Products


Stable Margin

Good deals Employees Stability of employment Good Values and culture Better Paid Social Security

removed and hired too i.e protecting the skilled and hardworking employees Met (for skilled and hardworking employees) Earnings have been increased from the pastMet The increase in revenue shows that the products are effectiveMet Last one to shift its production to overseas Not Met Shifting of the manufacturing unit to china help the customer in giving them suitable marginsMet The sales had been decreased Not Met


Environment Friendly
In PB I am confused whether it will be China production unit ? If so, then it will be Growth of suppliers.

Executive team

Prestige turn out the best division

Assessing the Stakeholder Group: Strategies are set to by taking into consideration the objectives of the key Persons which can be defined by following table Subjects Employees Crowd Players CEO and Board Shareholder Context Setter Govt. And Customer Power


2. What are the 5Qs of business strategy for your organisation? a) Q1, Growth Facts - Firm use to have 350 brands down to a 100 brands concentrating in a key dozen (withdrawal) - Closed 10 local factories and shed 1800 jobs, to move manufacturing offshore to China (downsizing) - In the process of selling beds and foam division (downsizing, withdrawal)

- Footwear, outerwear, and sportswear division was wrote down to $175m (withdrawal) - Made an EBITDA increase of 30% by performing all these activities. From the facts above the company might be opting to grow in this short to medium term, through Downsizing and Withdrawal of key underperforming sides of the business, by focusing on the ones with higher prospects of growth and profitability. b) Q2,3, Products and Markets Facts - We are not an industrial company - We really focus on consumer goods and textile - Shoppers either buy the number one brand or the price point offer and retailers are following suit. Strategic options Ansoff matrix: Market Penetration means increasing the amount and value of business with existing customers in existing markets. Products/Divisions - Underwear - Hosiery - Workwear and homewear - Footwear, outerwear and sport Customers - Department Stores - Supermarket channels - Small retailers - Own retailing and distribution of brands Markets - Australia

New Zealand UK Malaysia China Indonesia

c) Q4, Strategic Driver Facts - The future is in the ones that will be number one in the category. - 100 brands but focused on a key dozen. - Moving manufacturing offshore to reduce costs and be more competitive. - Analysts believe the majority of cost savings was made through advertising and marketing reductions. - The brands that will succeed in the future are the ones that are number one in the category. In favour of a Differentiation strategy: - Recognized brand names: and she is focusing on those assets to build the company around them in the future. - Product range: Pac Brands has a still very wide product range that allow them to stand out vs other firms in the market. - Image: the brands has a consistent image and some of then are recognized as Icons in Australia. Not supporting completely differentiation strategy: - There is not enough information to ascertain wether Pac Brands is executing on strengthening its brand assest with key Marketing and advertising. Only a mention from analysts on the contrary.

- Pac Brands use to have an even bigger range of 350 brands to claim a portfolio not matched in the region, now with its focusing this claim loses some strength. - Distribution channels are not partnering strongly with Pac Brands as they enter their own branding strategies, diminishing the value of Pac Brands Assets.

Generic Strategy: Focus - Making the product line narrow and thus easy to operate - Focused Functional Capabilities: This involves focusing on unique capabilities of the organisation and offering quality service to particular segment Overall the desired strategy is mix of differentiation and Generic Focus however in execution there are a few misalignments to that strategy that could be interpreted as Pac Brands is struggling to really find its intended goal, therefore might be seen as stuck in the middle as well. d) Q5, Industry position The intend of Pac Brands is to be number one in their category, as a leading brand is sales. 3. SWOT Analysis
SWOT ANALYSIS Strength 1. Standard Product Line Weaknesses 1. Complexity in production Opportunity 1.Opportunity to expand into overseas Asian market through production in china Threats 1. Political environment & controversy results in the loss of reputation

2. Leading establish Key Brands

2. Equity/Debt structure

2. Become a market leader in some category

3. Scale of operation in many countries

3. Many Loss making units.

4. Strong Leader & clear vision

4. Poor execution of transformatio n that costed more

5. Vast Experience in the Industry

6. Started Focusing on some Brands only 7. Good in Consumer goods and Textile

2. global financial crisis affected consumers sentiments & retail bargain power 3. New model 3. ACCC can for disrupt the distribution selling new value business chain 4.Department & other industry enter in the market with home-brand product 5. Difficult to refinance due to equity analyst rate the company negatively. 6. New in Asian Market

EXTENDED SWOT ANALYSES Q. How Can Pacific Brands use organisational strength to take advantage of opportunities? Strong Brands in Australian Market and decision of shifting the manufacturing unit to China will help Pacific Brands to enter into asian market.

Standard Product Line with 100 Brands will provide different qualities at different prices which provide flexibility in overseas Market. Strong leader with clear Vision will help the co. In making a market leader again in Australia as well as in overseas market too. Q. What options does Pacific brands have that address weakness to take advantage of opportunities? Shutting done the manufacturing and shift it to China thus saving the manufacturing cost. On expansion and reduce in manufacturing cost, profit will increase hence market capital will increase and it will help in stabilising the Debt Equity structure. Q. How can Pacific Brands use strength to avoid threats? There long experience in the industry will help in managing and developing flexible strategies if there are any changes in political environment. Focusing on some brands will help to excel in principal units as sufficient resources will be utilised and it will be difficult for competitors to imitate or replicate the product. Hence it will keep the competitor far behind. Strong Leader plus mastery in consumer goods and textiles will help the company to easily establish at overseas. Q. How can Pacific Brands develop defensive strategies that address weakness and threats to the organisation? Concentrate on Good Distribution channel to develop itself into new market Delegating the manufacturing work will help the company in using their resources well. 4. Capabilities & Gap Analysis-Pending

5. Balance Scorecard (Performance Measurement) Customer Perspective (a) Growth in Sales- Sales Fell (b) Market Share: As Pacific Brands have sold many of its Brands so the market share of the company fell (ii) Internal Process Perspective (a) Return on Assets: As in the Past the business was going in losses now various assets were sold and there is also increase in the earning of the company as compared to past. This shows that the Internal Process Prospective are good. (iii) Learning and Growth (a) Staff Satisfaction: ??? (b) New Customers: ??? (iv) Financial Perspective (a) Shareholder returns: Increase in Earnings and also . dividend were given to the investors (b) Revenue and Growth: Revenue is increasing but . the market share had reduced. (c) EBITA: EBITA has increased by 30.1% as . compared to previous half. 6. What challenges are the organisation is likely to face, or is experiencing, in implementing its strategies? Political and investor charged climate. Fickle Consumer sentiment and polarized retail market. Rising costs of cotton, Chinese labour and freight. ACCC might not approve the sell of the sportswear division. - Restructuring costs are more than they expected . - Mixed negative reviews on the transformation initiative from Equity analysts and investor community. (i)

7. Has the organisation considered any misalignment with all the interconnected 7-S aspects of the implementation plan? Strategy: Differentiation Structure: 4 Divisions, 7 Markets Systems: not enough information on neither production systems, market entry selection, financial risk, brand development, etc Style: Strong leadership and clear vision of a focus organization Staff: A diverse workforce operating in several markets, and talented management team with experience in several industries. Shared values: Not enough information on the values of the company Skills: Marketing skills, finding value in a few brands Strategic Performance: - Progressing on its transformation although costing more than planned - Mixed bad reviews from equity analysts community - Improving results since starting with strategy

- A heritage of an industrial company, aiming at transforming itself to a Sales and Marketing organisation Overall Company with the limited information provided Pac Brands does not seem completely aligned to its strategy

8. How has the organisation performed in its implementation Same as in strategic performance Determine the fit between the desired strategy and organisational culture and internal politics? Desired strategy is around differentiation on the brands Pac Brands can be leader of, however their long history heritage is around industrial goods and big manufacturing facilities, which might mean a disconnect between its company culture and internal politics with the strategy.