Case diagnosis and objectives - Volt Company

Read the case and then:

a) Performs a diagnosis of the company's environment
b) Performs an internal diagnosis of the company
c) Sets out the overall target for the company for 2018 at the unit level and in
market share.
d) It sets out four secondary objectives
Volt produces plasticized laminated and aluminum flexible packaging. Its
production capacity is 1,000,000 containers per year, operating at 70% of its
capacity.
The company is number two in the market, with a market share of 25% and the
leading company with 27%. Its packaging is for cookies and various types of
snacks.
It has 3 types of packaging that easily adapt to the requirements of its customers,
which are mostly export companies that prefer it for selling quality products
(considered 15% higher than the market average, although its prices are also 10%
higher).
With the Peruvian economy growing by 5% annually and the gastronomic boom
that has generated a 25% increase in food product exports per year and a 12%
increase in national consumption, the scenario is favorable for the company
because, although new competitors have entered the market, the company has
invested in Japanese machinery (the best in the market) and in training.Despite the
entry of new competitors, the company has invested in Japanese machinery (the
best on the market) and in training its production personnel, who now have an error
rate of less than 0.5% per million operations. The company's profits have grown at
an annual rate of 20% over the last two years, which has allowed it to purchase
machinery, increase salaries by 5% and improve its facilities. Employees have
taken notice and the company has been voted number one in its category as an
ideal place to work.
On the other hand, it has been able to make timely strategic decisions; for
example, last year it installed a plant to cover the growing demand in the southern
part of the country, in Arequipa. This US$5 million investment was made to take
advantage of the 9% growth in demand for this type of product in the provinces in
recent years. In addition, the economy of the southern zone has grown by 5% in
the last 5 years. Its management staff is highly qualified with specialized studies in
its entirety. The company invests 1% of annual profits in training the top
management and 3% in training all personnel, because increasingly competitive
companies are entering Peru. It has been estimated that they do so at a rate of 2
companies per year, which could threaten the company's second position in the
long term. The company allocates 3% of sales to advertising and marketing.
Its main customer is the corn snack exporter Grifar, which buys 35% of total
production. The remaining 65% is divided among 8 companies acquiring almost
the same amount. Companies buying smaller volumes are more focused on the
local market. It is worth mentioning that the products exported by its customers are
quite healthy and some are even organic, so it should be kept in mind that these
markets, both nationally and abroad, will continue to grow in the coming years at
5% for the local market and 10% for the foreign market.
One of its problems is that its main customers pay on credit for 120 days, which
means that the company sometimes faces a lack of liquidity. In addition, although
the price of the land for its plants has increased in value, housing has been
established near the Lurin plant, and it is estimated that there may be problems
with municipal operating permits in the long term.
Customers are satisfied, as a recent survey showed 87% satisfaction and only 4%
would consider switching to a competitor. They have no logistical problems, only
some complications in deliveries because they are outsourced to another
company, which has had a delay rate of 2% per month in the past year.
The company has also had problems with the ministry that regulates the
environment due to complaints about alleged contamination that, although not
supported by studies, could damage the company's image. About 30% of the
company's workers live near the plants, in what would be the area of influence of
the alleged contamination. If proven, the company's work climate could be
affected.