FIRST TEAM ASSIGNMENT

MODULE: Project Management: Leading, Creating, Implementing and Improving (M1)

FOR CLASS DISCUSSION ON THE THIRD LECTURE DAY

CASE: Communicating with stakeholders: A Bernard Matthews

case study

Bernard Matthews is the largest turkey producer in the UK. The business
has grown substantially since its relatively humble origins in 1950, when
Bernard Matthews bought 20 turkey eggs and a second-hand incubator. 12
turkeys successfully hatched from this initial batch and before long, the
young entrepreneur was able to give up his insurance job and concentrate
full-time on rearing turkeys.
Today, Bernard Matthews rears over seven million turkeys every year. 13
million UK households buy a Bernard Matthews Farms branded product
each year. Despite the size of its operations, the company remains close to
its roots in East Anglia with its farms located across Norfolk, Suffolk and
Lincolnshire. Bernard Matthews’ vision is ‘to make turkey the preferred
choice of protein for every day and every occasion’.
Bernard Matthews operates in a competitive and fast-changing environment.
Consumers are faced with a huge choice of foods to suit different lifestyles,
diets and tastes. However, in recent years, buying patterns have changed
as consumers have become more concerned about healthy eating, food
safety and animal welfare.

Fast-changing environment
Chance events can have a significant impact on a food business. For
example, Bernard Matthews’ problems date back a decade when Jamie
Oliver’s high-profile campaign in 2005 to improve the quality of school meals
singled out foods such as Bernard Matthews’ Turkey Twizzlers as being
unhealthy. The product contained artificial colours, flavours and
hydrogenated fats in its branded products and had high levels of saturated
fats and salts. The reputation of the brand declined and consumer had
misperceptions that turkey was just a processed food and therefore less
healthy than the fresh product. Adding to the challenge, every day in the
press and on TV, consumers were bombarded with often confusing or
contradictory information about the health benefits or risks associated with
different foods. Consumers may not have enough understanding or
information to judge between conflicting messages. By not responding to
these immediately or correcting with facts, consumers were confused and
the company lost credibility with the press and the public.
In 2007, there was an outbreak of bird flu at a Bernard Matthews farm in
Suffolk. At this time, the media also discovered that the company imported
some of its turkey from abroad, contradictory to the claim that it was locally
UK produced. The press published stories that this could have been directly
related to the outbreak, a theory that was never proved.

Leadership and communication

Communications came low on the list of priorities. This meant that the
resulting information 'vacuum' was soon filled with damaging and often
inaccurate news reports. Initially, Bernard Matthews did not speak up and
defend its product range, which offered affordable, tasty and convenient
food for everyday working mums. This resulted in adverse press coverage
and the company lost credibility with the media. When bird flu hit, relations
with the media were at an all-time low. The company's immediate reaction to
the crisis was to focus on eliminating the disease, which it did successfully,
but a strategy to communicate with internal and external stakeholders was
lacking.
When the company realised the extent of the damage and finally opened up
to the press it was too little, too late, as all trust had been lost. As a result,
Bernard Matthews’ sales in the UK fell by 35% and the company went into a
loss position.
The company came close to collapse in 2013, axing dozens of jobs, but
Rutland Partners stepped in and bought a majority stake for £25m in 2013
to rescue the business. A bid to remind customers of its “bootiful” roots and
win over mums across the country saw a rebrand in 2015. Rutland had hired
advisers at Litmus, a firm specialised in debt financing, in May 2015 to try
and attract outside investment but after three months of searching, Rutland
backed a further £10m cash injection into the food business in August 2015
to help fund its restructuring amid falling sales. But the turnaround plan has
had little effect.
To add to the mounting problems, the company has suffered from higher
feed costs and an oversupply of costs. Group sales for the year to the end
of June 2015 fell to £276m from £307m in the prior year, dragging operating
losses to £2m compared to £1.8m the year before. However pre-tax losses
after exceptional charges narrowed to £5.2m, compared to £9.9m the year
earlier but its turnover has continued to drop and the company was put up
for sale in June 2016.

It has gone from a household name which dominated its market to a

struggling firm unable to pay its bills.
QUESTIONS:

Question 1: Critique the case from a leadership, internal and external

communication with stakeholders, and barriers to communication point of view.

Question 2: How would the above influence Product Development projects in

the organisation?

Question 3: What should be done to remedy the situation?

Note that the organisation basically disregarded Customer Expectations that

are so important in the Industry 4.0 economy. This will also detrimentally
influence Product Development projects they do, which is another
very important aspect influenced by Industry 4.0. Start your analysis by
doing a SWOT analysis, i.e., look at the Strengths, Weaknesses,
Opportunities, and Threats associated with the organisation.

TIP: Critique means delivering a critical discussion regarding

the situation described in the case. It is advisable to do a SWOT
(Strengths, Weaknesses, Opportunities and Threats) analysis to better
understand the situation under scrutiny. Keep in mind that the world has
entered the “collaboratist” Fourth Industrial Revolution (Industry 4.0)
economy that demands organisations to undergo serious transformation
and change in many respects as discussed in the course content.