HEINZ COMPANY

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Then, Heinz has acquired a lot of intangible resources as its reputation, innovation, the human or the environmental aspect. First, the company has developed a very high brand name with a good reputation and trusted. Heinz possess a big innovation center in Pennsylvania of 100 000 soft and opened a new European center in Nijmegen, Netherlands. Besides, the company has shown innovation by reducing the amount of salt in its products and replacing sugar with stevia. Then, in terms of human resources, Heinz has more than 32 000 employees in the world and 2100 in UK and Ireland. Finally, the company has established different goals for 2015 concerning environment such as reducing water and consumption energy, reducing packaging material by 15% or reducing transportation fossil fuel consumption by 10%.

- Competencies [cf appendix n°2]

Many of the resources and capabilities emphasize the same competencies. In fact, most actions and decisions contribute to the positive brand image growth.

On the human level, the company offers free development program, including online training and proposes a « Healthcare plan » to engage the hearts and minds of them. Heinz undertakes to help its employees on their personal development but also on their family life with the « Childcare » offer (Heinz, 2015). By these different actions, Heinz set up a dynamic and challenging business environment and it maintains the competencies level of its employees. Thus, Heinz creates the employee’s satisfaction and loyalty.

The company has undertaken in nine environmental goals, e.g., reducing packaging material and transportation fossil fuel consumption (Heinz, 2015). This engagement in the environment arouses the respect of the costumers and contributes to the positive image brand.

Through its several development centers, Heinz has a high level of innovation. The company has the capability to create others products. In this way, the costumers have the satisfaction to choose in a large range of products.

The distinctive advantages derive from 3 areas: Innovation, reputation and architecture. We can say that the distinctive capability of Heinz Company is its reputation. This reputation creates the loyalty of the consumers. They trust the company and stay faithful to the products over a long period of time, e.g., 1, 5 million cans of Heinz beans are sold every day (Heinz, 2015). Its second competitive advantage is its capability of innovation, which contributes to its positive reputation.

- Strategic ability of the company

- Value chain analysis [cf appendix n°3]

The primary activities and the support activities of the company are in a perfect harmony. Heinz has been able to remain one of the market’s leaders for more than a hundred years and it is due to a very well structured organization. Concerning its primary activities, we can notice that Heinz, thanks to low input costs, the manufacturing of its own product and the designing of the packaging, the quality control and a low cost distribution, succeeded in developing a high brand recognition and reputation and a strong customer base. Furthermore, its support activities are very complementary and enable the company to establish its leadership. The most significant support activities are its presence in almost every supermarket and grocery worldwide, a dynamic and challenging environment for its employees, its ability to change and improve its products and skills and finally, long-term relationships and prepaid arrangement with its suppliers.

- VRIN analysis [cf appendix n°4]

VRIN [value, rarity, inimitability and non-substitutability] analysis allows knowing the strategic capabilities in the company and serves as a basis of competitive advantage.

So the first point is the value of strategic capabilities. Value represents the capabilities that are valued by customers whether about environmental opportunities, brand or about costs. Heinz has a lot of capabilities with value such as strong financial resources, a good reputation, high level of innovation and research and development, and customers’ loyalty.

Then, the majority of these resources are rather rare but not all. Indeed, loyalty and financial resources can be present in others competitors.

Besides, certain resources are difficult to imitate as the high level of innovation, a good reputation and the employees’ satisfaction. On the contrary, others competencies are copied easily.

Afterwards, all competencies are not substitutable such as the level of innovation.

Finally, the company obtains a competitive advantage when the four characteristics are present. So, the main advantage of Heinz is its reputation and customers’ loyalty, its high level of innovation and research and development and the employees’ satisfaction.

Conclusion: SWOT diagnostic [cf appendix n°5]

For many years, Heinz is a reference in the processed food market. By its high level on research and development, Heinz offers a large range of quality and diversified products. The company has established an excellent reputation and has won the customers’ trust and loyalty. In this way, Heinz possesses a strong place on the processed food market. However, the company has also weaknesses such as its majority of fat products and its slight seasonal dependency. In this way, the firm has to be careful to external threats. In fact, there are lots of competitors, many regulations and a process of food safety.

Since the opportunities that Heinz meets in the market, we can identify a development strategic. In fact, growing demand for health and infant good had been identified in the last few years. Thus, Heinz should create new products better for health and change its image brand. In the objective to follow the safety food process and be identified as a good brand for health, Heinz has to establish a suitable way of communication.

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REFERENCE

HENRY A. (2011), Understanding Strategic Management, Second Edition, New York, Oxford University Press Inc, pp 48-58, pp 128-132.

Cornelsen L. and Carreida A. (2015) Health-related taxes on food and beverages.

http://foodresearch.org.uk/wp-content/uploads/2015/05/Food-and-beverages-taxes-final-20-May-