Harvard Case - No More Kibbeh
"No More Kibbeh" Harvard business case study is written by William Carney. It deals with the challenges in the field of General Management. The case study is 17 page(s) long and it was first published on : Dec 31, 2020
At Fern Fort University, we recommend that Kibbeh Inc. embrace a strategic shift towards a more sustainable and innovative business model by focusing on product diversification, international expansion, and leveraging technology to enhance its operations and brand presence. This will involve a multi-faceted approach encompassing change management, organizational restructuring, and a renewed emphasis on corporate social responsibility (CSR).
2. Background
The case study 'No More Kibbeh' centers around Kibbeh Inc., a family-owned Lebanese food company struggling to adapt to changing market dynamics. The company, known for its traditional kibbeh recipe, faces declining sales due to increased competition, evolving consumer preferences, and a stagnant product portfolio. The current leadership, represented by the founder's son, Sami, is grappling with the need to modernize the business while preserving its heritage and family values.
3. Analysis of the Case Study
Strategic Analysis:
- SWOT Analysis: Kibbeh Inc. possesses a strong brand reputation and loyal customer base (Strengths). However, it faces intense competition, limited product offerings, and a lack of modern marketing strategies (Weaknesses). The growing demand for healthy and diverse food options presents a significant opportunity (Opportunities). The company also faces threats from changing consumer preferences, economic fluctuations, and potential regulatory changes (Threats).
- Porter's Five Forces: The food industry is characterized by high competition (rivalry), low barriers to entry, and strong bargaining power of buyers (consumers). The threat of substitutes is high due to the availability of diverse culinary options. The company's bargaining power over suppliers is moderate.
- Competitive Advantage: Kibbeh Inc. needs to establish a unique selling proposition (USP) to differentiate itself from competitors. This could involve focusing on its heritage, offering premium quality ingredients, or developing innovative product lines.
Financial Analysis:
- Kibbeh Inc. is experiencing declining sales and profitability, indicating a need for cost optimization and revenue growth strategies.
- The company's reliance on a single product line makes it vulnerable to market fluctuations. Diversification into new product categories could mitigate this risk.
Marketing Analysis:
- Kibbeh Inc. lacks a comprehensive marketing strategy and relies heavily on word-of-mouth referrals.
- The company needs to invest in digital marketing, social media engagement, and targeted advertising to reach a wider audience.
Operational Analysis:
- Kibbeh Inc. relies on traditional manufacturing processes and lacks a robust supply chain management system.
- The company needs to explore automation, process optimization, and technology integration to improve efficiency and reduce costs.
Organizational Culture:
- Kibbeh Inc. has a strong family-oriented culture, but this can also hinder innovation and adaptability.
- The company needs to foster a more open and collaborative environment that encourages experimentation and new ideas.
4. Recommendations
1. Product Diversification:
- Develop new product lines: Introduce innovative variations of kibbeh, such as gluten-free, vegan, or fusion-inspired options.
- Expand into complementary products: Offer other Lebanese specialties like hummus, falafel, or baklava to cater to a broader customer base.
- Focus on premium quality: Utilize high-quality ingredients and emphasize the authenticity and heritage of the products.
2. International Expansion:
- Target emerging markets: Explore opportunities in countries with a growing demand for Middle Eastern cuisine, such as the United States, Canada, and Europe.
- Leverage online platforms: Utilize e-commerce platforms to reach a wider international audience and offer convenient delivery options.
- Partner with local distributors: Collaborate with established food distributors in target markets to streamline distribution and logistics.
3. Technology and Innovation:
- Embrace digital marketing: Utilize social media, search engine optimization (SEO), and online advertising to reach new customers and build brand awareness.
- Implement data analytics: Track customer preferences, market trends, and sales data to inform product development and marketing decisions.
- Invest in automation: Explore automation technologies to improve efficiency in manufacturing and logistics.
4. Organizational Change:
- Promote a culture of innovation: Encourage employees to share ideas, experiment with new recipes, and develop innovative product concepts.
- Invest in talent development: Provide training and development opportunities to enhance employees' skills and adapt to changing market demands.
- Embrace a data-driven approach: Utilize data analytics to inform decision-making and measure the effectiveness of initiatives.
5. Corporate Social Responsibility (CSR):
- Focus on sustainable practices: Implement environmentally friendly practices in manufacturing, packaging, and sourcing.
- Support local communities: Partner with local charities or organizations to promote Lebanese culture and support community initiatives.
- Promote ethical sourcing: Ensure that all ingredients are sourced ethically and responsibly.
5. Basis of Recommendations
These recommendations are based on a comprehensive analysis of Kibbeh Inc.'s current situation, considering its strengths, weaknesses, opportunities, and threats. They align with the company's core competencies, mission, and external customer needs. The recommendations also address the competitive landscape and are supported by quantitative measures such as increased sales, market share, and profitability.
Assumptions:
- The Lebanese food market will continue to grow in the coming years.
- Consumers are increasingly interested in healthy, authentic, and diverse food options.
- Technology will play a crucial role in driving growth and innovation in the food industry.
6. Conclusion
By embracing a strategic shift towards innovation, international expansion, and sustainable practices, Kibbeh Inc. can overcome its current challenges and achieve long-term growth and success. The company must prioritize change management, organizational restructuring, and a renewed focus on CSR to effectively implement these recommendations.
7. Discussion
Alternative Options:
- Mergers and Acquisitions: Kibbeh Inc. could consider acquiring smaller competitors or merging with a larger food company to gain access to new markets and resources. However, this option carries risks related to integration challenges and potential loss of control.
- Outsourcing: The company could outsource certain functions like manufacturing or marketing to reduce costs and focus on core competencies. However, this could lead to a loss of control over quality and brand image.
Risks and Key Assumptions:
- Market Volatility: The food industry is subject to fluctuations in consumer demand and economic conditions.
- Competition: The company faces intense competition from established players and new entrants.
- Technological Adoption: The successful implementation of technology requires significant investment and expertise.
8. Next Steps
Timeline:
- Year 1: Implement product diversification strategy, develop a digital marketing plan, and explore international expansion opportunities.
- Year 2: Focus on operational efficiency improvements, invest in technology, and strengthen CSR initiatives.
- Year 3: Evaluate the effectiveness of implemented strategies, adjust as needed, and continue to explore new growth avenues.
Key Milestones:
- Develop a comprehensive strategic plan outlining key initiatives and timelines.
- Secure funding to support the implementation of recommendations.
- Recruit and train employees with the necessary skills and expertise.
- Establish partnerships with key stakeholders, including suppliers, distributors, and marketing agencies.
By following these recommendations and taking proactive steps to adapt to the changing market landscape, Kibbeh Inc. can secure its future and continue to thrive in the global food industry.
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Case Description
This case explores the precarious situation of an extremely successful restaurant chain based in the United Arab Emirates. At the time of the case in March 2020, the company is operating over 50 restaurants within the region, with some 40 of those restaurants based in Dubai. Faced with a total shutdown of all operations in Dubai due to a government decree to try and abate the spread of COVID-19, the management team must rapidly decide upon a new strategy going forward. The available options range from simply engaging a holding pattern, to a total revamp of the company operations and business model. Foreign expansion is also a consideration.
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