CHAPTER 8 Strategy Functional Strategy & Strategic Choice Formulation Vernando 122120131 Rustiawibisono D.T. 122120164 Dessy Chairunisa Liany 122120030

CHAPTER 8 Strategy Formulation: Functional Strategy & Strategic Choice The approach a functional area takes to achieve corporate and business unit objectives and strategies by maximizing resource productivity Prentice Hall 2006

Pricing Selling Distribution Marketing Strategy Functional Strategy Prentice Hall 2006

Marketing Strategy – Product development Line extension Functional Strategy Marketing Strategy – Product development Line extension Using a successful brand name to market other products It is a good way to appeal to a company’s current customers Prentice Hall 2006

Marketing Strategy Advertising and promotion Push strategy Functional Strategy Marketing Strategy Advertising and promotion Push strategy Spending a large amount of money on trade promotion in order to gain or hold shelf space in retail outlets Pull strategy Advertising pulls the products through the distribution channels A company will spend more money on consumer advertising designed to build brand awareness so that shoppers will ask for the product Prentice Hall 2006

Marketing Strategy Pricing Skim pricing Penetration pricing Functional Strategy Marketing Strategy Pricing Skim pricing Penetration pricing Dynamic pricing Prentice Hall 2006

Functional Strategy R&D Strategy – Deals with product and process innovation and improvement Technological leader Technological follower Open innovation A new approach in which a firm uses alliances and connections with corporate, government and academic labs to learn about new developments Prentice Hall 2006

Functional Strategy Purchasing Strategy – Deals with obtaining the raw materials, parts, and supplies needed to perform the operations function Multiple sourcing A purchasing company orders a particular part from several vendors Sole sourcing Relies on only one supplier for a particular part Just-in-time (JIT) Having the purchased parts arrive at the plant just when they are needed rather than keeping inventories. Prentice Hall 2006

Functional Strategy Logistics Strategy – Deals with the flow of products into and out of the manufacturing process Centralization Outsourcing Internet Prentice Hall 2006

Functional Strategy HRM Strategy – Addresses the issue of whether a company or business unit should hire a large number of low-skilled employees who receive low pay, perform repetitive jobs, and most likely quit after a short time or hire skilled employees who receive relatively high pay and are cross-trained to participate in self-managing work teams Prentice Hall 2006

Functional Strategy Operations Strategy – Determines how and where a product or service is to be manufactured Job shop Connected line batch flow Flexible manufacturing systems Dedicated transfer lines Mass production Continuous improvement system Modular manufacturing Prentice Hall 2006

Outsourcing errors Activities that should not be outsourced Functional Strategy Outsourcing errors Activities that should not be outsourced Wrong vendor selection Writing poor contract Overlooking personnel issues Hidden costs of outsourcing Failing to plan exit strategy Prentice Hall 2006

Proposed Outsourcing Matrix Prentice Hall 2006

Strategies to Avoid 3 Follow the leader Hit another home run Arms race Functional Strategy Strategies to Avoid 3 Follow the leader Hit another home run Arms race Do everything Losing hand Prentice Hall 2006

Constructing Corporate Scenarios Prentice Hall 2006

Subjective Factors Affecting Decisions Functional Strategy Subjective Factors Affecting Decisions Management’s attitude toward risk Pressures from stakeholders Pressures from corporate culture Needs and desires of key managers Prentice Hall 2006

Stakeholder Priority Matrix Prentice Hall 2006

Evaluation of Strategic Alternatives Strategic Choice Evaluation of Strategic Alternatives Mutual exclusivity Success Completeness Internal consistency Prentice Hall 2006

TOP KOPI CASE STUDY Prentice Hall 2006

TOP KOPI Tingginya minat orang Indonesia untuk minum kopi ternyata menarik sejumlah perusahaan untuk menciptakan produk inovatif berbahan dasar kopi. Salah satunya Wings Food, perusahaan fast moving consumer goods, yang baru saja meluncurkan kopi instan bernama “Top Coffee”. Agar bisa menjadi merek top seperti Mie Sedaap dan So Klin, PT Harum Alam Segar (anak usaha Wings Food) menjalankan enam jurus strategis.

R & D STRATEGY Sebelum meramaikan pasar kopi instan, perusahaan melakukan riset selama 2 tahun untuk menganalisa peluang bisnis, tren pasar, hingga karakteristik konsumen. Setelah itu, proses pengembangan konsep produk dimulai dari mencari diferensiasi, hingga distribusi penjualan. saat ini kopi merupakan industri global raksasa yang mempekerjakan lebih dari 20 juta orang. Komoditi ini menempati urutan kedua setelah minyak bumi, dengan lebih dari 400 miliar cangkir yang dikonsumsi setiap tahun. Alhasil, kopi menjadi minuman paling populer di dunia setelah air putih.

DIFFERENTIATION STRATEGY Wingsfood mengklaim, Top Coffee memiliki positioning product di pasar. Yaitu, mengemas produk yang merupakan perpaduan dua jenis kopi robusta dan arabika. Dengan dua keunikan karakter yang berbeda, maka proses pemilihan biji kopi, saat pemetikan, ketepatan dalam temperatur dan penghitungan dilakukan secara detail dan tepat. Karena kerumitan dan pengolahan high tech tersebut, Top Coffee berani mengusung taqline “the art of coffee blending”.

MARKETING STRATEGY Langkah selanjutnya adalah memilih duta merek (brand ambassador). Untuk meningkatakan citra merek, perusahaan menunjuk penyanyi legendaris Iwan Fals. Top Coffee dan Iwan Fals memiliki kesamaan seperti idealisme dalam seni, dan menghasilkan mahakarya yang dikenang.

MARKET SEGMENTATION Strategi keempat, menjaring banyak segmen. Di tengah persaingan yang semakin ketat, Wings Food jeli melihat peluang dengan membidik pasar tanpa batasan umur. Caranya dengan menciptakan 4 varian mulai dari kopi murni, kopi gula untuk dewasa, kopi susu, dan kopi mocca untuk remaja.

ABOVE THE LINE & BELOW THE LINE ACTIVITY Strategi kelima, gencar melakukan aktivitas above the line (ATL) dan below the line (BTL). Untuk ATL misalnya, komunikasi merek dilakukan dimedia massa periodik baik cetak, elektronik ataupun online. Selain itu, Top Coffee juga kerap muncul dimedia massa non-periodik seperti billboard dan brosur. Sedangkan aktifitas BTL diselenggarakan bersamaan dengan konser Iwan Fals dibeberapa daerah. 

PARTNERSHIP Bermitra dengan petani kopi untuk mendapatkan biji kopi terbaik. Selain mengajak kerjasama, Wings Food juga mengandalkan kebun kopi pribadi sehingga kestabilan produksi bisa terjaga.

Thank You