Murray Goulburn | SWOT, Lean thinking principles and Global Strategy Assignment Help
SWOT Analysis
SWOT matrix combines the insight of internal as well as external environment of organisation and aids in making market entry decision. It encompasses; strengths, weaknesses, opportunities and threats.
Strengths of Murray Goulburn
The core strength of MG lies in being one of the oldest as well as most recognized dairy business of Australia. The portfolio of diverse, pasteurized and high quality dairy products also adds in strength of company and makes it highly differentiated among other dairy companies. The brand is well recognized in Australia and in international markets and it has solid customer base. Another strength of company is based on its operational excellence and innovation capabilities. One highly differentiated strength of Murray is its farmer’s cooperative ownership, which makes its shareholder’s core suppliers of the milk and thus risk of supply side is reduced for company.
Weaknesses of Murray Goulburn
Murray Goulburn has few weaknesses as well. For instance, its exposure is limited in terms of direct production and it only exports its milk and dairy products to international markets. Additionally, Murray has no prior experience with Philippines market and demands of its consumers.
Opportunities for Murray Goulburn
There are many opportunities for Murray, as it can expand its brand portfolio to enter into markets with new product categories. Additionally, Murray has opportunities to make entrance in markets which do not have well developed dairy sector and depends on foreign dairy products. For instance, China, Japan, South Korea and Philippines are not self-sufficient in dairy industry and thus entrance in this markets can offer huge revenue to Murray.
Threats for Murray Goulburn
Threats for Murray Goulburn are mainly linked with its entrance in international markets. For instance, mainly company exports milk to international markets and trade barriers posit threat to approach export markets. Additionally, the competition is always a threat for any business and Murray needs to devise strategies for dealing with competition in both domestic as well as international markets including for Philippines market. Additionally, changes in external business environment, such as economic, political and technological are also likely to pose threat for Murray.
Lean Thinking Principles
Lean thinking principles offers way to organisation of resources for granting more benefits to company as well as to society. Murray can make reliance on five lean thinking principles including; value, value stream, flow, pull and perfection. Murray can adopt top down pricing approach in Philippines market to determine the value expected by customers for powdered milk and formula. In the next step of value stream, company can identify and eliminate activities which do not add value to product and thus waste can be minimized. It will require changes in production processes of company.
The flow focuses on creation of value chain which can lower waste, can help to continue with production in un-interrupted manner and can lower time to market. The existing manufacturing of Murray has high flow, and same processes can be followed for Philippines market. The Pull principle is much evident in dairy sector, as products are not produced prior to specific time and thus waste is minimized. Finally, Murray is recommended to stick with the continuous improvement processes with an aim of accomplishing perfection in its value chain. Quality control and monitoring can serve the purpose.
Global Strategy
The development of effective global strategy is necessary for defining success of an organisation in international market. Murray Goulburn can define its global strategy based on AAA frameworks, which encompasses; adaptation, aggregation and arbitrage strategies to approach a global market. The adaptation requires to make changes in products or offerings of company. This strategy is not suitable for Murray, as company will enter in Philippines market with its powdered milk and baby and toddler formula, which are likely to have demand in Philippines market.
The second strategy of aggregation addresses that in global business strategy, company can focus on either economy of scale of economy of scope to enhance value for consumers. Economy of scale is relevant with Murray as it can produce bulk of powdered milk and infant formula products to gain cost advantage in Philippines market. The economy of scope cannot be created, as company is entering with only two product categories.
Finally, the arbitrage strategy is also not suitable for company, as it demands relocation of supply chain to exploit regional differences. Based on its farmer’s cooperative ownership in Australia, Murray has advantage of supply side and it is not feasible to adopt arbitrage strategy. So most suitable global strategy for Philippines market is aggregation.
References
Myerson, P. (2018). Lean Demand-driven Procurement: How to Apply Lean Thinking to Your Supply Management Processes. Productivity Press.
Berger, S. L. T., Yokoyama, T. T., & Rodriguez, C. M. T. (2018). An overview of Lean Supply Chain Management: concepts, principles and impacts. Journal of Lean Systems, 3(2), 90-103.
Murray Goulburn (2019). About Murray Goulburn. Retrieved From; http://www.mgc.com.au/.
Morschett, D., Schramm-Klein, H., & Zentes, J. (2015). The Integration/Responsiveness-and the AAA-Frameworks. In Strategic International Management (pp. 25-49). Springer Gabler, Wiesbaden.
Phadermrod, B., Crowder, R. M., & Wills, G. B. (2019). Importance-performance analysis based SWOT analysis. International Journal of Information Management, 44, 194-203.
Motohashi, K. (2015). Management Strategies for Global Businesses. In Global Business Strategy (pp. 21-40). Springer, Tokyo.
