MBA 705 Milestone Five Guidelines and Rubric Overview: For the capstone assessment, you will create a business implementation plan and audiovisual presentation for the product, service, or idea you have been developing throughout your MBA coursework. In Milestone Five, you will submit the assumptions and contingency planning, in which you will clearly explain the assumptions you have made in creating your business implementation plan, any factors that may affect those assumptions or the success of the project, and how you have planned for those contingencies. At a minimum, you should discuss any cross-cultural, economic, and geopolitical factors that may impact the business environment and concept; how you will ensure that the project operates in a legally and ethically compliant environment, including relevant laws, regulations, or patents or permits that may need to be obtained; plans for incorporating stakeholder and customer diversity into planning and implementation of the concept; and the role corporate social responsibility will play in the implementation of you concept. Critical Elements:  Explain the assumptions you have made in creating your business implementation plan, including a discussion of any factors that may affect the assumptions or success of the project, and how you have planned for those contingencies.  Discuss any cross-cultural, economic, and geopolitical factors that may impact the business environment and concept.  Explain how you will ensure that the project operates in a legally and ethically compliant environment, including relevant laws, regulations, or patents or permits that may need to be obtained.  Outline plans for incorporating stakeholder and customer diversity into planning and implementation of the concept.  Discuss the role that corporate social responsibility will play in the implementation of your concept. Guidelines for Submission: Your draft must contain all of the elements listed above. It should be 5 to 8 pages in length (excluding the title page, references, and appendices) using 12-point Times New Roman font, with one-inch margins. You may include summary pictures, charts, graphs, or other explanatory diagrams as needed to successfully explain the concept and implementation, but should use appendices for detailed supporting documentation. Your paper should follow APA guidelines. You must include at least 5 scholarly sources. Cite your sources within the text of your paper and on the reference page. Critical Elements Main Elements Critical Thinking Assumptions Cross-Cultural, Economic, and Geopolitical Factors Proficient (100%) Includes most of the main elements Provides logical conclusions and defends with examples Explains the assumptions behind the plan and includes a discussion of any factors that may affect the assumptions or success of the project and contingency planning Discusses cross-cultural, economic, and geopolitical factors that may impact the business environment and concept Not Proficient (0%) Does not include any of the main elements Does not provide logical conclusions Does not explain the assumptions behind the plan and include discussion of any factors that may affect the assumptions or success of the project Does not discuss cross-cultural, economic, and geopolitical factors that may impact the business environment and concept Value 15 15 12 12 Legally and Ethically Compliant Environment Stakeholder and Customer Diversity Corporate Social Responsibility Articulation of Response Explains how the project will operate in a legally and ethically compliant environment, including relevant laws, regulations, or patents or permits that may need to be obtained Outlines plans for incorporating stakeholder and customer diversity into planning and implementation of the concept Discusses the role corporate social responsibility will play in the implementation of the concept Submission does not have critical errors related to citations, grammar, spelling, syntax, or organization that prevent understanding of ideas Does not explain how the project will operate in a legally and ethically compliant environment, including relevant laws, regulations, or patents or permits that may need to be obtained Does not outline plans for incorporating stakeholder and customer diversity into planning and implementation of the concept Does not discuss the role corporate social responsibility will play in the implementation of the concept Submission has critical errors related to citations, grammar, spelling, syntax, or organization that prevent understanding of ideas Total 12 12 12 10 100% Running Head: MILESTONE 4-1 – FINANCIAL ANALYSES & FUNDING PLAN 4-1 Milestone Four: Financial Analyses and Funding Plan Jonathan Brannan Southern New Hampshire University Course MBA-705 January 20, 2019 Dr. Isabel Wan 1 Running Head: MILESTONE 4-1 – FINANCIAL ANALYSES & FUNDING PLAN 2 Introduction Kellogg’s is the leading producer of ready-to-eat cereals and other food products in the world. The key to Kellogg’s success has been its ability to keep up with the ever changing trends and tastes in the breakfast food industry. As a result, the company has launched a new product to adapt to the current healthier and quick eating trend in the breakfast food industry. The company has launched Yo-Bran to assist in maintaining its large market share while at the same time increasing profitability. However, the success of the product launch is dependent on proper financial analysis and sufficient funding. This milestone undertakes a financial analysis of the new Yo-Bran cereal and develops an appropriate funding plan that will assist in launching and maintain the product in the market in the long-term. It analyzes the projected costs, revenue streams and breakeven analysis of the product. Running Head: MILESTONE 4-1 – FINANCIAL ANALYSES & FUNDING PLAN Financial Analysis Projected Costs. The breakfast food industry is very competitive characterized by large industrial players who aim at controlling the market. As such, launching of the new Yo-Bran cereal in the market will require a huge investment. The company needs to undertake intensive advertising and marketing for the product to create market awareness and attract customers (Chamlee, 2016). There are also costs related to legal expenses, Yo-Bran ingredients, rent packaging and other materials, promotion, insurance, distribution, salaries and wages and other costs as highlighted in the projected costs table: Table: Projected Costs New product launch: Yo-Bran cereal Expenses Legal fees Rent Salaries & wages Distribution Promotion Yo-Bran ingredients Insurance Advertising and marketing Total Projected Costs $12,000 $60,000 $120,000 $70,000 $18,000 $50,000 $20,000 $150,000 $500,000 Revenue Streams. Kellogg Company reported a decrease in its sales revenue due to changes in customers’ tastes and breakfast-skippers. As a result, Kellogg’s has to target a different market segment in order to maintain its high sales revenue. The company has to develop alternative revenue streams for Yo-Bran in order to diversify its market portfolio. One such revenue stream is targeting the middle and higher income earners in the society and increase their customer base. Attracting new customers from this consumer market will enable 3 Running Head: MILESTONE 4-1 – FINANCIAL ANALYSES & FUNDING PLAN 4 Kellogg’s Yo-Bran to build its brand which will be vital in maintaining its sales revenues (Linshi, 2015). Technology has also revolutionized the breakfast food industry. There has been a substantial increase in the adoption of technology and the new form of communication; social media which has made the world a global village. Kellogg’s should develop an e-commerce website where the company can boost the sales of the new product. Yo-Bran cereal can also be marketed digitally via the different social media platforms as a means of building the image and brand of the new product thus assist in increasing its sales revenue. Analysis Parts Budget. Kellogg Company has a wide customer base as it operates globally. As such, the company needs to manufacture sufficient Yo-Bran cereals to meet the anticipated high demand for the product. The product launch is estimated to cost $700,000. The numbers in the budget are meant to reflect on these estimates. Table: Budget Yo-Bran Development costs Payroll expenses Production costs Marketing and Promotion Projected costs Estimated Budget Total $25,000 $15,000 $65,000 $75,000 $500,000 $680,000 Assessment of Assets and Liabilities. The company’s capital requirement for launching the new product is estimated to be around $680,000. The company will provide the bulk of the capital financing in the amount of $450,000. The additional funding will be done through debt financing. As a result, the resulting assessment of assets and liabilities on launching the new product will be as follows: Running Head: MILESTONE 4-1 – FINANCIAL ANALYSES & FUNDING PLAN 5 Table: Assets and Liabilities Assets Non-cash Assets Cash requirements Additional cash raised Total Assets Liabilities and Capital Liabilities Current Borrowing Long-term liabilities Total Liabilities Capital Company Contribution Debt funding Total planned Investment Total Capital and Liabilities $300,000 $280,000 $200,000 $780,000 $15,000 $25,000 $60,000 $100,000 $450,000 $230,000 $680,000 $780,000 Anticipated Sources of Funding. Kellogg Company will raise the highest share of the additional funds required to launch the new product. The company will raise $450,000 which amounts to 66% of the funds. The amount will be financed from the company’s reserves from previous years of operation. The remaining 34% will be raised through debt. The company will seek external loans to finance the new product which is expected to take the market by storm due to its health benefits. Costs of attaining Capital. The company has decide to provide the largest finance share for the new product launch through utilizing its company reserves to reduce the costs associated with attaining capital The additional funding needed by the new product will be gotten through debt and it will be the only costs associated with attaining capital. The interest rates on the loan will be paid annually for four years until the completion of the loan. The debt will be acquired at Running Head: MILESTONE 4-1 – FINANCIAL ANALYSES & FUNDING PLAN 6 12.5% p.a for a period of four years. This means that the cost of attaining the additional funds will be 12.5% × $230,000 × 4 which is $11,500. The debt finance acquired by Kellogg to finance the new product launch will be paid after four years with a value of $230,000 + $11,500 = $ 241,500. However, the cost of attaining the capital will be $11,500. Financial Reports Sales Forecasts. As a new product of a startup venture there will be a laxity in sales in the first months as the people are trying to understand the product. Therefore the first few months will be slightly low in terms of sales proceeds Assuming that each cereal box is sold at $5 and the number of boxes sold varies from 40 -50 .The projected sales in the first month will be 5*50*20 business days) =$5000.This forecast shows that the costs are slightly higher as a result of the product being new. However, Kellogg bares in mind that the clientele base is growing and that people will need alternatives from their norm. Hence the number of boxes sold daily is expected to double to an average of 100 boxes. This means that Kellogg will be in a position to break even within the first year of its operation.Kellog sales are net of the expenditures that is the sales returns and the allowances provided. Based on the debt financing acquired we anticipate to purchase equipment that will aid in increasing the production of the breakfast cereal. Therefore the other financial year will see an increase in sales forecast not only due to production but also due to increased consumer preference Cash Flow Statement. Cash flow is a vital aspect to any business that is why as Kellogg we will focus more on liquidity and also increased cash reserves. The fact that our liabilities are not much as the only liabilities are creditors and short term loans. Overtime we will issue shares to improve on our share capital at a fixed share of twenty percent of the whole company. Increased capital structure will help the company have positive projected cash flows as the Running Head: MILESTONE 4-1 – FINANCIAL ANALYSES & FUNDING PLAN 7 obligations will not be as much and they will be met on time. In terms of slow business months there will be need to liaise with the company’s financial institution that will alleviate the financial position of the company during these periods. Additionally the cash reserves will be ploughed back as investments in terms of opening up other branches. The cash flow project for the new product is as follows: Table: Cash Flow FY2019 Cash received Cash sales Cash from accounts receivables Additional Cash received sale of current assets new investment received Total Expenditures Cash spending Bill Payments Additional cash spent Sales tax Repayment of current borrowing Purchase of assets Total Cash Balance FY2020 FY2021 FY2022 $320,000 $0 $380,000 $25,000 $450,000 $32,000 $510,000 $53,000 $0 $0 $320,000 $12,000 $2,000 $419,000 $5,000 $7,000 $494,000 $8,500 $12,500 $584,000 $120,000 $25,000 $150,000 $35,000 $200,000 $25,000 $231,000 $52,000 $80,000 $0 $0 $225,000 $95,000 $95,000 $12,000 $5,000 $297,000 $122,000 $112,500 $15,000 $6,000 $358,500 $135,500 $127,500 $6,300 $8,900 $425,700 $158,300 Income Projections. Kellogg Company is among the market leaders in the breakfast food industry. As such, the company has an established market and customer base. Yo-Bran is expected to become profitable in the first 18 months of operations. Profits will increase substantially in the next three years of operations as the Yo-Bran cereal establishes and expands on its customer base. The income projections of the new product are as follows: Running Head: MILESTONE 4-1 – FINANCIAL ANALYSES & FUNDING PLAN 8 Table: Income Projections Sales Cost of Goods Production Expenses Total cost of goods sold Gross Margin Expenses sales and marketing salaries and wages Insurance Rent Utilities Total Operating expenses Profit before tax & interest Interest expense Tax Net profit FY2019 $320,000 $5,000 $5,800 $10,800 $309,200 FY2020 $380,000 $7,500 $6,500 $14,000 $366,000 FY2021 $450,000 $9,000 $7,000 $16,000 $434,000 FY2022 $510,000 $9,500 $8,600 $18,100 $491,900 $90,000 $25,000 $35,000 $15,000 $11,000 $176,000 $133,200 $2,875 $48,000 $82,325 $120,000 $35,000 $30,000 $15,000 $12,000 $212,000 $154,000 $2,875 $57,000 $94,125 $150,000 $45,000 $40,000 $15,000 $13,000 $263,000 $171,000 $2,875 $67,500 $100,625 $180,000 $50,000 $50,000 $15,000 $14,000 $309,000 $182,900 $2,875 $76,500 $103,525 Running Head: MILESTONE 4-1 – FINANCIAL ANALYSES & FUNDING PLAN 9 References Chamlee, V. (2016, May 17). Americans Are Increasingly Obsessed With Breakfast. Retrieved on January 18, 2019 from https://www.eater.com/2016/5/17/11691604/us-breakfastconsumption-rise InfoScout. (n.d.). Kellogg’s Consumer Insights. Retrieved on January 18, 2019 from http://infoscout.co/brand/kelloggs?ab=b&utm_expid=75303912-24.l6L7NHOEQzeM9P-hvusJw.1&utm_referrer=https%3A%2F%2Fwww.google.com%2F Kellogg Company: Consumer packaged goods - company profile, SWOT & financial analysis. (2016). Basingstoke: Progressive Digital Media. Retrieved from http://ezproxy.snhu.edu/login?url=http://search.proquest.com.ezproxy.snhu.edu/docview/ 1850338659?accountid=3783 Kellogg company 2006 company profile edition 1: SWOT analysis. (2006). (). Bromsgrove: Aroq Limited. Retrieved from http://ezproxy.snhu.edu/login?url=http://search.proquest.com.ezproxy.snhu.edu/docview/ 213118167?accountid=3783: Linshi, J. (2015, February 12). Skipping Breakfast and Decline in Kellogg’s Cereal Market. Retrieved on January 18, 2019 from http://time.com/3705987/skipping-breakfast-cerealkellogg/ Running head: MILESTONE 1-2 - JUSTIFICATION 1-2 Milestone One: Justification Jonathan Brannan Southern New Hampshire University Course MBA-705 December 23, 2018 Dr. Isabel Wan 1 Running head: MILESTONE 1-2 - JUSTIFICATION 2 Rationale Over the years, Kellogg`s Company, a breakfast cereal manufacturing entity has enjoyed tremendous growth. The establishment has always responded well to changing market trends and has always emerged successful. The products the company produces have over the years been the choice of many peoples’ healthy breakfast stop (Avey, 2012). Such products are what made the company register greater strides in growth to be one of the leading cereal companies in the 20th century. However, changing consumer lifestyles has shifted the company’s business strategy. The most evident result of these emerging trends is the drop in the company`s yearly sales by 4% in the U.S market. Due to this, the company needed to adopt a new product that sets to address the emerging consumer trends to remain in operation and boost its annual sales. Another reason as to why Yo-Bran needs to be adopted is the issue of competition that has grown rife in the breakfast cereal industry in recent years. Kellogg`s needs to effectively compete with other key industry players and emerging brands for consumers. To effectively compete, the firm needs to adopt products that have not been produced by other firms but are in demand by consumers. The biggest strategy of winning in the business driven competition is by producing goods that satisfy the consumer and not products that are fit for the market. In producing goods that fit the market, in most instances, the company produces goods that every other company is producing to match their production. But in producing goods that satisfy the consumer, the company invests in products that are in line with the current consumer demands, and this is where Yo-Bran comes in. Yo-Bran is set to quench the demand of consumers who are now avoiding sugary cereals. The ultimate goal is to overturn the sales that plunged in past years and register significant improvement. Running head: MILESTONE 1-2 - JUSTIFICATION 3 Many breakfast cereals in the market today are genetically modified. The U.S is the leading player in this industry (Hallman et al. 2013). The reception of genetically modified foods has had a lot of misconceptions and poor public perceptions. The quest of Kellogg`s Company to penetrate such markets where opinions are rife would prove difficult. For the company to increase its market share and increase its annual sales globally, it has to expand its market base. The expansion involves venturing into territories where the company has not operated before. It will be a huge task to penetrate a market where misconceptions of genetically modified foods are high. Hence, for the firm to realize expansion, it has to adopt healthier products like Yo-Bran that would readily be adopted in those areas and help the company to grow. Opportunity According to Jack Linshi of Time.com, the breakfast cereal industry is faced with the challenge of producing a taste and healthy alternative that appeal to consumers (Linshi, 2015). This gap leaves an opportunity for Kellogg’s to take advantage of. A gap presents a business opportunity, and the existence of such a gap means there is a ready market for the products developed specifically for that spotted chance. Yo-Bran introduces a completely different taste and healthy alternative that is in line with consumer specifications and demands. The introduction of the product to the market will be a major response to consumer demands which include a better tasting product and a healthier alternative to other breakfast foods. The development of Yo-Bran came about to fill the needs of Kellogg’s consumers. The current focus of the breakfast food industry is now on products that promote healthy living and wellbeing of the consumer. The products that have been proven to cause various medical conditions are being avoided. For instance, sugary cereals that have a negative impact on teeth and cause other general health problems are being avoided. It is for this reason that the Running head: MILESTONE 1-2 - JUSTIFICATION 4 development of Yo-Bran presents an alternative to such consumers to help them live healthier lives. Kellogg’s has taken their consumers’ health and wellbeing in to consideration with YoBran. More and more people are getting concerned about products that have long-term side effects, and Yo-Bran will alleviate these concerns. Market Analysis The ultimate winner in the innovation of a new product is the company that produces a product with the global market as the major objective (Cooper, 2013). Product performance is greatly dependent on the vibrant marketing strategy accentuated by the company. The primary target market for Kellogg’s Yo-Bran is breakfast consumers who are shifting to healthy eating. The product geared towards tapping a market of consumers avoiding sugary foods to foster good health. Furthermore, the taste of cereal products has been in question before which triggered the development of Yo-Bran. The identified gap regarding taste is the market Yo-Bran sets to fill. The intention is to present a product with a unique, and a favorable taste unmatched by any other current product in the market. The unique and healthy taste along with consistent demand from consumers will help prove Yo-Bran successful. Consequently, Kellogg`s in recent years adopted a rigorous marketing strategy that is set to draw more young adults into embracing breakfast (Bonigalia). Initial studies show that young adults in the age bracket 25-35 with income ranging between $35000-70000 an untapped market. The studies further show that males of the age 16-24 do not readily take breakfast. Statistically, the population consists of huge numbers of the males in the stated age bracket. By sensitization through the marketing strategy that the company has adopted, the said persons will provide a wide market for Yo-Bran products. The figures alluded to are generally from the U.S, a market environment the firm has in the past dominated, and hence holds a significant advantage over. Running head: MILESTONE 1-2 - JUSTIFICATION 5 Yo-Bran is projected to appeal to them because of the health factors it portends, the taste that is significant with age stated, and the ease with which preparation achieved. Further, the company will continue taking advantage of the African-American and the middle age who have been the loyal customers for Kellogg`s products. Moreover, the product introduced to international markets where the company enjoys significant support. The markets include Canada, Australia, and the United Kingdom. The strategy is in line with the thought that a new product should be developed for the world and marketed to the globe (Cooper, 2013). The market territories mentioned provides an expansive platform for the product to thrive in and register tremendous growth. Quality and innovation incorporated in the product is the primary strength of the product that capitalization in, and rigorous marketing will play a key role in its market acceptance and take off positively. Competitive Analysis Investigations carried out by market analysis establishment NPD group show projections breakfast consumption could rise by a 5% margin come 2019 (Chamlee, 2016). The facts present an opportune moment for the breakfast cereal industry. The competition that is set to arise due to these facts will be immense, but Kellogg`s will sustain itself through the marketing initiatives it has so far adopted. Also, the quality of Yo-Bran is unmatched by current products with similar features in the market. Clients are very concerned about the quality of the products they associate with, and hence, the projections show a great reception of Kellogg’s Yo-Bran. The quality of the product and marketing strategy, along with Kellogg’s brand name, are the driving force the company intends to leverage on to ensure the product beats all kinds of competition from other market key players. Running head: MILESTONE 1-2 - JUSTIFICATION 6 Yo-Bran was developed with the health of consumers in mind, which means that the product holds a significant advantage over the rest of the competition. The concept of healthy living that has played a crucial role in the design of the product as a factor will receive much attention from consumers. During the marketing campaigns, the factor of health intentionally highlighted, so that the targeted market can get a glimpse of the leverage the product has over the rest. The intention is to raise awareness of the benefits of the product to the consumer to gain a significant market share. The competitors will have a rough time matching the benefits offered by Yo-Bran. Since the endeavors by other companies to match this product won’t be spontaneous, the company will leverage that window to push the sales of the goods. Eventually, the product will be part of the healthier living culture we live in today. Company: Kellogg’s According to Kellogg’s their Vision states that “To enrich and delight the world through foods and brands that matter (Kellogg Company).” The fact that Yo-Bran is a product that is devoted to the wellbeing of the consumer regarding health, it is in line with the statement of the vision of enriching and delighting. It is an enrichment because of the health of the consumer taken into account. Also, it is a delight to the consumer by them realizing that the product they associated with will not have a negative impact on their health. So, Yo-Bran is a product that matters a lot to consumers since the ultimate goal is to provide a product that has the taste the consumer wants and concerned about their health. On the other hand, the mission statement of Kellogg Company states that “Kellogg is a global company committed to building long-term growth in volume and profit and to enhancing its worldwide leadership position by providing nutritious food products of superior value.” First, the product that is in question is nutritious and of high quality combining yogurt, cereal with Running head: MILESTONE 1-2 - JUSTIFICATION 7 fresh fruit, and granola. The nutritious and quality part is in line with some part of the mission statement. Second, the part of the mission talks about the company`s long-term growth in volume and profit. Yo-Bran will to a great extent help the company diversify in its products leading to more sales, growth, an increase in the company`s net profits. Finally, in stamping the firm`s leadership position, the new product is a milestone in setting a pace for healthy eating hence taking command in global product leadership. Lastly, the priority of the company is to create a platform where ideas can grow and register success. Yo-Bran presents a new idea and a new specter of a product that if adopted present the company with an opportunity to steer its success to greater heights. The company, therefore, need to give the idea an opportunity to grow and help the company register significant success in line with its priorities. Innovation The products that have been in the market show some shortcoming. The created gap between the manufacturer and the consumers. Majorly, the concern of the consumers has been the amount of sugar-laden cereals. Second, is the fact that the sugary cereals cause health challenges for the clients. Finally, is the taste of the cereals which breakfast consumers feel should taste a particular way. Innovations are set to breach such gaps and provide solutions to existing problems. Yo-Bran developers took into considerations all these factors and produced a product that addresses the challenges alluded. It is an innovation that addresses the challenge of taste, health concerns, and significantly reduces sugar in its composition. It is an innovation that that by far will set the pace in the industry of cereals adopted for breakfast. Running head: MILESTONE 1-2 - JUSTIFICATION 8 References Avey, T. (2012, November 29). What’s for Breakfast? Discover the History of Cereal. Retrieved on December 17, 2018, from http://www.pbs.org/food/the-history-kitchen/history-ofcereal/ Bonigala, M. (n.d.). Kellogg’s Adopts New Target Market. Retrieved on December 17, 2018, from https://www.spellbrand.com/kelloggs-adopts-new-target-market Chamlee, V. (2016, May 17). Americans Are Increasingly Obsessed With Breakfast. Retrieved on December 17, 2018 from https://www.eater.com/2016/5/17/11691604/us-breakfastconsumption-rise Cooper, R. G. (2013). New products: What separates the winners from the losers and what drives success. PDMA handbook of new product development, 3-34. Cooper, R. G. (2013). New products: What separates the winners from the losers and what drives success. PDMA handbook of new product development, 3-34. Hallman, W. K., Cuite, C. L., & Morin, X. (2013). Public perceptions of labeling genetically modified foods. Kellogg’s. (n.d.). Business Summary. Retrieved on December 17, 2018, from http://investor.kelloggs.com/business-summary#overview Linshi, J. (2015, February 12). Skipping Breakfast and Decline in Kellogg’s Cereal Market. Retrieved on December 17, 2018, from http://time.com/3705987/skipping-breakfastcereal-kellogg/ Running head: MILESTONE 3-1 – COMPANY AND KEY PERSONNEL 3-1 Milestone Three: Company and Key Personnel Jonathan Brannan Southern New Hampshire University Course MBA-705 January 13, 2019 Dr. Isabel Wan 1 Running head: MILESTONE 3-1 – COMPANY AND KEY PERSONNEL Introduction When launching a product, a company ought to ensure that all necessary resources are in place, in order to ensure successful designing, production, marketing and launching of the product. Personnel such as; market research experts, product designers, quality managers, a project manager, marketing personnel, and sales personnel, will be key in ensuring successful launch of Yo-Bran. These employees will play a key role of ensuring that: a thorough market research is conducted, the design of the product is appealing, production is carried out effectively and products are thoroughly tests, and that effective customer service is ensured. Leveraging human resource skills ensures that corporate culture is aligned to building a competitive advantage because employees offer innovative skills. Corporate culture has the potential to boost or bury a new product idea before or after it’s launched, hence the need to invest in the organizational culture in order to ensure that employees supports the company’s long term goals and innovation. 2 Running head: MILESTONE 3-1 – COMPANY AND KEY PERSONNEL Organization’s Core Competencies Each company has its key competences, which could be corporate culture, product design, corporate responsibility, pricing, or customer service. However, even the most successful competencies can fail if not built on a strong corporate culture which encourages team work, innovation, and ensures employee satisfaction and motivation. Core competencies such as technology, experience, ability, and knowledge ensure innovation, low operating costs, and good customer services. These competencies help distinguish an organization and its products from rivals, thus resulting to high competitive advantage. Therefore, employees, who have the potential to achieve these competencies, can help the organization effectively create and implement the product. Companies have the potential of utilizing their personnel as one of the key competencies and as a means of developing strategic responsiveness (Belassi, 2013). Kellogg's can build on its human resource competences by expanding the existing human capital capacity and through employee training and recruitments. These efforts would make it possible to establish a culture which recognizes customer needs and meets them accordingly. Skilled personnel fits within the company’s long term goals, especially the core competencies needed for the product launch. Human resources offer a high level of innovation; hence diverse teams have capability to ensure the product’s success. Employee competencies go beyond simply performing daily job description tasks(Ivana Nacinovic, 2009). Rather, these competencies ensure that employees understand market trends, understand the company’s vision and mission, and buy into the company’s long terms goals of assuming market leadership in the cereals industry in the US market and across the globe. The company’s personnel also offers competences of tech skills as well as the ability to communicate effective, network, and partner with industry leaders. Therefore, the personnel will offer a platform on which the company and the new product can build its success. 3 Running head: MILESTONE 3-1 – COMPANY AND KEY PERSONNEL Human resources are a key competence because employees are responsible of ensuring the company’s readiness to design, manufacture, market, and successfully launch the product. Fast growth of the product would also require an ability to keep up in order to ensure that supply matches demand, hence the need for employees to ensure scalability of resources to accommodate changes. A successful product launch and increased demand will automatically result to an increase in customer attention, hence the need to ensure a motivated and satisfied customer service team is in place to address these needs. This team would also ensure that customer inquiries and needs are addressed in time. Corporate Culture Kellogg's corporate culture has the capacity to affect the quality and quantity of the new product launch. Therefore, for successful launch of the product, the company should focus on being customer centric, should be technology driven, and should also be competitor focused. Customer focus. According to research, companies that adopt a customer centered corporate culture are able to achieve more success in products development and launch. By focusing on the customer needs, the company would be able to incorporate consumer feedback in the product design and development process (Walid Belassi, 2007). This would ultimately ensure customer loyalty as well as product recognition. Involving all employees. For successful launching of the product, internal stakeholders should be on board with the new product and should be kept engaged. All employees, including those who are not directly involved in the product launch, should be onboard. Therefore, before and after the launch, employees should be encouraged to embrace the product for personal use and share about it on their social media platforms. Before selling the product to the target customers, the company should first ensure that employees buy into 4 Running head: MILESTONE 3-1 – COMPANY AND KEY PERSONNEL it. An ongoing workshop about the product should be established to ensure that employees are educated about the product. Technology. Kellogg's should focus on establishing a corporate culture centered on innovation and creativity. Before and during the product launch, innovation and creativity should be encouraged by creating a safe space where employees can freely express their thoughts. This will ensure that efficiency, affordable marketing, and low cost production are embraced. Customer needs and preferences are fast changing thus leading to changes in customer demand. Therefore, the company’s culture should be able to utilize these technologies in keeping up with the changing trends (Belassi, 2013). Through use of technology, they should be able to master latest innovations in order to create cutting edgeproducts. This should be the case, especially during the initial stages of product development which require a lot of creativity. The company should also be able to encourage risk taking, and the ability to come up with original ideas. This will help the team ensure that; rather than only following competitors’ approaches of producing, marketing, and distributing of cereal products, the company gets to support innovation which will help create a creative system for the product. This technology will help ensure quality of products, will encourage low operation costs, and will also save time. Diversity. Kellogg's should also embrace a culture of inclusion through which employees of different genders, race, and age groups are engaged in the product launch. This can help with innovation and creativity, and ensure diversity which is good for the company’s image, especially when dealing with customers and suppliers. 5 Running head: MILESTONE 3-1 – COMPANY AND KEY PERSONNEL Key Roles, Responsibilities, and Qualifications Project manager. This role will entail coordinating all aspects of the product and resources involved, including human resources. This position requires thorough understanding of the market and the product. Senior management. The senior management, including the CEO and senior executives will play an important role of coordinating the team and in reinforcing innovation in order to position the organization towards achieving success. Product marketing launch manager. This is a central and critical role which will be at the center of the product launch process. This manager will be responsible of developing and executing a thorough market plan for the new product Sales Personnel. The product manager will work closely with the marketing personnel including sales team which will be on the ground ensuring that the cereal is thoroughly marketed in various markets. Product support/customer service team. This team will be responsible of ensuring that: after the product has been released, customer needs including possible complains are addressed accordingly. Contingency Plans In the event the team composition needs to be modified, the company will explore various options including employing individuals on permanent, contract, or temporary basis. As unexpected or additional tasks in research, marketing, or administration come up, the company will employ employees on contract basis to carry out temporary tasks, consultants will be utilized in drafting various strategies, while long term vacancies will be filled by new permanent basis hires. 6 Running head: MILESTONE 3-1 – COMPANY AND KEY PERSONNEL A new product launch process will create additional work demand; hence hiring seasonal staff on temporary basis to meet this need will be the most effective approach. These employees will work for a temporary period of one year or less, thus ensuring that extra work is completed without incurring too much hiring cost. Unlike hiring on a permanent basis, seasonal employees are usually already skilled and previously vetted for the position; hence this contingency plan will help save the company time as well as money. This plan will also offer flexibility, making it possible to only hire specifically needed skills at a particular time. The company can also recruit part-time employees who will be paid an hourly wage rather than a monthly or annual pay. This approach will help save overheads as it minimizes employee down time (Marshall, 2014). Kellogg's can also opt for contractors who will bring in a team of workers to perform specific tasks, especially in manufacturing of the cereals. Unlike under a temporary or permanent employment arrangement, the company will not pay the workers directly, but rather, will pay the contractor who will in return pay the workers. Contractors tend to be experts who specialize in a specific skill, hence are likely to offer more expertise, thus ensuring success of the product. 7 Running head: MILESTONE 3-1 – COMPANY AND KEY PERSONNEL References Ali Gursoy, B. G. (2016). Effect of Innovative Culture on Intrapreneurship. International Journal of Business and Social Science , 11. Belassi, W. (2013). The Impact of Organizational Culture on the Success of New Product Development Projects: A Theoretical Framework of the Missing Link . The Journal of International Management Studies, Volume 8 Number 2, 10. Ivana Nacinovic, L. G. (2009). Corporate Culture and Innovation: Implications for Reward Systems . Ivana Nacinovic, Lovorka Galetic, and Nevenka Cavlek . Marshall, M. I. (2014). Planning for the Unexpected: Human Resource Risk and Contingency Planning. ResearchGate. Walid Belassi, A. Z. (2007). New product development projects: The effects of organizational culture. Project Management Journal. 8 Running head: MILESTONE 2-1 – IMPLEMENTATION PLAN 2-1 Milestone Two: Implementation Plan Jonathan Brannan Southern New Hampshire University Course MBA-705 January 5, 2019 Dr. Isabel Wan 1 Running head: MILESTONE 2-1 – IMPLEMENTATION PLAN Physical and Technological Resources Capital resources. In order to fund production, marketing, and distribution of the new product, Kellogg`s Company will need an infusion of capital through exploring various capital contribution options. The new product will be funded through ploughing back of profits. Operational resources. In order to successfully implement the new product, Kellogg`s will need various resources such as a manufacturing facility for Yo-Bran. The company will also need to make room for more resources of additional staff, who will focus on the new product. The additional staff members will be recruited to ensure that there is sufficient staff team to deal with the additional needs of production, marketing, and manufacturing of the new product, as well as in running other operations-related tasks. A proper working space and sufficient information systems such as computers and new telephone lines will also be necessary. Experts. For successful implementation, the new product’s design and production will be carried out through a support team of experts. These individuals will provide expertise and train employees on how to successfully develop and launch the cereal product. Technologies. Some of the relevant technologies that will help cut cost and ensure efficiency in operations include; robotics and ERP. These can be used in enhancing communication in the production process. An active website will also be needed for smooth advertising of the product. Manufacturing of Yo-Bran will require precision in preserving the ingredients and in ensuring quality of products. Keeping a digital data system will help deliver real-time updates and overview of the process, thus ensuring accuracy and minimizing downtime which could be caused by stock out. The production process will also rely on formulaic production methodologies and detailed product recipes, thus ensuring that 2 Running head: MILESTONE 2-1 – IMPLEMENTATION PLAN that burden is alleviated from equipment operators, since the process will be less manual. These tools will ensure lean manufacturing and timely delivery of products to the market. Kellogg`s also has to comply with the food and beverage industry regulatory requirements. Therefore, emerging technologies such as Internet of Things (IoT) will be useful in ensuring that; when producing the product, the company is able to deploy improved track and trace methods in the post-production monitoring process. This way, any products that need improvement can be traced back to where the defects originated, thus making it possible to prevent repeat incidences of poor quality products. In stocking and restocking the product, the company will utilize a flow-through sorting system which will make the restocking process simpler. Robotic palletize and de-palletize technologies will be incorporated in order to ensure that modularity, flexibility, and scalability are ensured (Papageorgiou, 2018). Implementation Schedule 1. Market Research. This will be a three month process, during which a lot of money will be allocated to research and development. This task will be carried out by an outsourced team of market researchers. 2. Building the product. Based on the market needs identified during the research process, product design and the building process will begin, lasting for a period of two months. This process will include establishing the product mix. 3. Creating a buzz around the product. This task will take place one month before the launch. During this period, simple PR and press releases will be done. The marketing team will be responsible of this activity. A buzz will alert the target audience of the newly to be introduced cereal. The product will also be introduced through various media platforms. A buzz will help gain customers of the product before the actual product in actually launched to the market. 3 Running head: MILESTONE 2-1 – IMPLEMENTATION PLAN 4. Product launch. After manufacturing and creating a buzz, the product launch process will take place in a period of one week. Top managers and the marketing team will work closely in launching the product. Outsourced team of online marketers and tech savvy people will help with online marketing and optimization of online marketing campaigns. 5. Monitoring and development. After the launch, product monitoring will begin immediately. During this process, product quality, price, and demand as well as sales will be monitored closely in order to provide room for improvements. The quality will be monitored through customer feedback, and if need be, the necessary changes will be made. Table 1: Task Duration Party Responsible Market Research 3 months Contracted Company Building product 2 months (Product Design/ Manufacturing team Mix) Creating Buzz 1 months Marketing Team Product Launch 1 week Operations manager/ Top managers 4 Running head: MILESTONE 2-1 – IMPLEMENTATION PLAN Monitoring and Continuous development Manufacturing, Marketing, & Finance Team. Project Review Processes The project review processes will include operation, functional reviews as well as performance reviews (UAS, 2013). The project’s success is dependent on success of the product, which can be measured through sales increase, profitability, customer engagement, and customer loyalty. Success of the product’s implementation process shall be measured through the following factors; 1. Business Analytics. Success of the product in the market will be closely tracked using business analytics through various metrics of sales per day, new customers, repeat sales, and customer base growth. These metrics will help establish value of the launched product overtime, thus providing feedback on the areas that need improvement. The analysis will also measure customer engagement with the product on the company’s website. The biggest challenge will be maintaining the buzz and social media engagement before and after the launch, hence the focus on the ability to keep customers talking about the cereal and its health benefits will be a critical measure of the product’s success. 2. Testimonials. Online testimonials as well as reviews and feedback from customers will also be a key approach to reviewing success of the product. Due to the freedom that social media and other online platforms provide, objective criticism of the product will be available online, thus making it possible to make improvements. 5 Running head: MILESTONE 2-1 – IMPLEMENTATION PLAN 3. Customer surveys. After sales, customers will be offered an option to rate the cereal in terms of quality, fair pricing, and their satisfaction with the product in general. This will offer a more reliable form of feedback from actual customers. 4. Proven results in terms profitability and increase in sales. The ability to increase sales overtime and break even within the expected one year will be an indication that the product has performed well. Other factors such as a loyal and growing customer base will also be an indicator that the product is a success in the market. 5. Customer demographic trends. Often, a product may become more popular among unexpected demographics. The main geographic location for the Yo-Bran target market segment will be in the United States as there is a national shift to eating healthier. The age of the demographic will be 25-35, with a medium income of $35,000 - $70,000.Consumption of the product by this demographic as well as others will be closely monitored to establish demand trends. Intrapreneurship Factor Trademark. Protecting rights to the product is essential for long term profitability, as well as the ability to build competitive advantage. Defining origin of the product can help prevent third parties from legally developing an identical product, especially in terms of the design. Yo-Bran cereal is however not easy to trademark because cereals are a commonly available product (Papageorgiou, 2018). Therefore, restricting others from selling a similar product mix may be impossible (Musick, 2009). However, the company will be able to make the product’s brand stand out by using a name or phrase that is eligible for trademark, and focus on using it when marketing the product and other Kellogg’s products. In addition, other measures will be taken to ensure that the product mix ideas are all kept confidential through a non-compete and non-disclosure document signed by the employees who are directly 6 Running head: MILESTONE 2-1 – IMPLEMENTATION PLAN involved in the production process. This will ensure that employees do not use the knowledge of the product and communicate this to the competition or start a competition business. This agreement will be legally drafted by a lawyer who will help ensure that all ideas developed by employees in relation to the product will solely belong to the company, hence will only be for the benefit of the company. This will ensure that; in case of a falling out, former partners or employees do not act against the company. Leveraging on human capital. In order to ensure success, intrapreneurship and entrepreneurial factors such as the ability to find and manage the right people, will be considered. By leveraging on employees, vendors, and other human resources, pulling together of resources will be ensured, and the product will be a success. Organizational culture. The implementation process will take into account various factors of organizational culture (Ali Gursoy, 2016). Availability of a creative and innovative team will be significant in ensuring product success. A good team will also encourage risk taking, rather than only following competitors on how they navigate production, marketing, and distribution of cereal products. This ability to support innovation will help create a creative system for the product, including the ability to utilize technology in production, marketing, and distribution, thus saving time and cost. 7 Running head: MILESTONE 2-1 – IMPLEMENTATION PLAN References Ali Gursoy, B. G. (2016). Effect of Innovative Culture on Intrapreneurship. International Journal of Business and Social Science , 11. Bamdad, F. (2015). New Technologies in the Processing of Functional and Nutraceutical Cereals and Extruded Products. Nutraceutical and Functional Food Processing Technology. Musick, E. M. (2009). PROTECTION OF INTANGIBLE ASSETS. Procopio, 2. Papageorgiou, M. (2018). Introduction to cereal processing and by-products. Sustainable Recovery and Reutilization of Cereal. UAS. (2013). The Project Quality Review Process (PQRP). University of Oxford , 8. 8
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