Solving Efeso

Solving Efesos food industry study has bite

Solving Efeso

Solving Efesos food industry study has bite

A leading global chain of management consultants has published a report aimed at showing how some companies are ghting t despite a turbulent market
Written by: Sheree Hanna Produced by: Kiron Chavda

perating a successful company in the increasingly challenging food manufacturing sector is about to get a whole lot easier thanks to a ground breaking new report from international management consultancy, Solving Efeso. Fit to Win Food Industry Companies: Navigating Troubled Waters has taken some 18 months to research and compile and includes a list of top performing companies within the food sector based on criteria that is unique to the market. It emphasises the power of executing strategies to reach growth potential and highlights those companies which have achieved success by recognising their strengths and capabilities and working those factors to their advantage. The reports author is Philippe Jaegy, Group Vice President Strategy Practice and Food Industry, who said: We aim to update the report every two years because this barometer or rank we have created is unique. It doesnt exist on the market because what you normally see is a ranking linked to the stock market or valuation of the company. What we have done is devised
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Solving Efeso
Solving Efesos food industry study has bite
a ranking based on a combination of growth and value creation in the market which is far more sophisticated. International network Solving Efesos Food Division is based in Paris where the main study was conducted although there was input from the consultancys extensive international network. It has ofces across the world including the UK, USA, UAE, South America and the Far East. Jaegy, who joined the consultancy in 1999, is an expert in strategy and organisation of the food industry and is now a member of the Executive Committee in charge of the strategy practice and FMCG Sector. His work involves advising many C-level teams of blue chip companies, family businesses and cooperatives on their strategy roadmap denition. The study was implemented after he became increasingly tired of hearing excuses about how hard it is to achieve success in the sector because of issues such as the state of the economy or the competition was too difcult. I have seen companies in the same sector facing the same level of difculties with the same inconsistent situation deliver exceedingly good results, he explained. So I thought it was time to explain why the economic crisis is not the answer to all the problems, indeed some food companies when faced with such constraints have been able to grow and create value thanks to their strategy, business model and management culture. In fact our motto is yes you can. There is nosinglerecipefor achieving and sustaining good performance in the food industry, there are winning combinations. We have dened seven successful paths to growth. Nevertheless, what a company has to do is identify the battleeld, and category to ght in, and align the business model to suit according to its capabilities. Excelling when it comes to executing strategy is also key to outperform, only one company out of 10 does it correctly. Challenges ahead Todays food industry players face a variety of challenges, said Jaegy, including volatility of raw material prices, defending existing market share, determining the right innovations, conquering emerging markets, maintaining productivity,

Philippe Jaegy

Glocal strategy Focused strategy Cost competitiveness Breakthrough innovation led by the business model Agility Ability to control raw material volatility Flawless execution
...while Attracting, retaining and cultivating talents and deploying energies

The 7 keys to SUCCESS

*

What we have done is devised a ranking based on a combination of growth and value creation in the market which is far more sophisticated
Philippe Jaegy, Group Vice President Strategy Practice and Food Industry
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* excluding sector impacts

cold chain

Solving Efeso
Supplier Prole

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From words to action. A group of some 400 consultants representing more than 30 nationalities and operating from 26 oces around the world. More than 30 years of experience and thought leadership. International scope and local delivery capability. Our clients have access to the specialist skills they require whether at national, regional or global levels. www.solvingefeso.com info.marketing@solvingefeso.com

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Solving Efeso
Employees: 450 Established: 1979 Industry: Management Consulting Services: Solving Efeso is a top management consultancy rm with a leading reputation for connecting strategy with action. Management: Vice President Clive Geldard Vice President Luca Stoppino Website: www.solvingelfeso.com
Visit us online:

managing risk and complexity and attracting and nurturing the right talents. The food industry is undergoing a complete transformation and there are a number of structural drivers which are all moving at the same time, said Jaegy. Companies are having to deal with the volatility of raw material prices, which have risen to 20 percent in the past two years, consumers themselves are becoming more complex in terms of how and what they spend money on and we have seen strong growth of private labels, which has resulted in a kind of trading down in the industry.

In fact our motto is yes you can. There is nosinglerecipefor achieving and sustaining good performance in the food industry, there are winning combinations
Philippe Jaegy A winning combination
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Solving Efeso
Solving Efesos food industry study has bite
There are also other social and political pressures on food companies including regulation taxes and dealing with food waste. Today some 30 percent of food produced is destroyed. However, Jaegy said it is those companies who have denition, attack the market with vigour, come up with innovative approaches, have the vision to strategise and carry a plan through to completion no matter what size or sector they are in, which continue to be successful. The CONSISTENCY-EXCELLENCEAGILITY nexus pays off. At the top of Solving Efesos

Most companies that are successful understand how to spot opportunities and transform them into winning strategies. They have the capability and ability to adapt to the environment they operate in
Philippe Jaegy
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CONSISTENCY: identify the category to fight in, and align the business model to suit
Extensive Extensive

3- Hybrid model

2- Low cost model Market size

4- Differentiation model

1- Convenience model

5- Niche model

Limited Limited Low Low

Solving Efeso 2014

Perceived value/price

High

list is the UK-based drinks giant SABMiller and other big names including Associated British Foods, plc, Nestle and ConAgra Foods, but slotting into the third spot was Mexico-based Grupo Bimbo. It was one of two companies coming from emerging economies to hit the top 20, said Jaegy. It was something of a surprise. Strategic agility Originally from the Catalan region of Spain, this Mexican company developed rst in Central America, and North America (via its acquisition of Sara Lees US baker

The CONSISTENCY-EXCELLENCE-AGILITY nexus pays off

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activities) then in South America, and Asia. Today, it is the worlds leading bakery company and a ne example of how to utilise strategic agility. Its highly targeted distribution methods have been adapted to the complexities of local market structures, such as the way it uses tricycles to make deliveries in Chinese towns and cities where streets are too narrow for vehicles. Most companies that are successful understand how to spot opportunities and transform them into winning strategies. They have the capability and ability to adapt to
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Solving Efeso
Solving Efesos food industry study has bite
STATISTICS
The Top 10 businesses that achieve outstanding results

1 2 3 4 5 6 7 8 9 10

USA

UK

USA

USA

Switzerland

USA

UK

Mexico

Germany

UK

Solving Efeso 2014

the environment they operate in, said Jaegy. There are also notable successes among small and medium-sized enterprises (SMEs) such as in the USA where Chobani, founded by a Turkish businessman, has conquered 47 percent of the market for Greek yoghurt, a fast-growing segment that accounts for more than one-third of the yoghurt market. Finding a niche Its winning formula has been product innovation. It offers
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Highly targeted distribution methods a 100 percent low-fat, highprotein yoghurt, which has twice the amount of protein than its comparable Danone product, backed by a constantly refreshed product line-up and intensive

investment. Jaegy said: There are some very successful small companies because they are focused on creating a strong association within a specic niche, which is the case with Chobani. It is now a leader in a highly specialised market. Jaegy has recently presented the results of the study at the World Trade European Food Manufacturing Summit in the Netherlands and it has also been discussed at a similar event held in Dallas, USA. Wiebe De Vries, Global Marketing Communications Manager, said one of the key ndings of the report is that strategies most likely fail not because they are not good but if employees are not engaged. He said: The study offers a very different way at looking at the food industry and we want to start conversations with the sectors representatives to nd out whether they face similar situations and discuss what they can do to achieve more success. The way we have analysed the data is a fresh way of looking at things and we are looking forward to getting feedback from our clients, although from what we have heard so far we have hit the nail on the head, concluded De Vries.

INDUSTRY: Management consultancy FOUNDED: 1980 HEADQUARTERS: Paris, France KEY PEOpLE/TiTLES: Filippo Mantegazza, CEO PRODUCTS: Strategy in Action, comprising of Strategy (Doing the right things), Operational Excellence (doing the things right) and Change Management (making it stick) REVENUE: EUR 69 million EMpLOYEES: Over 400 WEBSiTE:
www.solvingefeso.com
Visit us online:

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Glocal strategy Focused strategy Cost competitiveness Breakthrough innovation led by the business model Agility Ability to control raw material volatility Flawless execution
...while Attracting, retaining and cultivating talents and deploying energies

The 7 keys to SUCCESS

*

excluding sector impacts

Solving Efeso 117 Avenue des Champs Elyses, 75008, Paris, France Tel +33 1 53 53 57 00 info.marketing@solvingefeso.com www.solvingefeso.com

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