Case Study Report Sample

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A Case Study Description

The principal aim of this coursework is to assess the strategic management problems and challenges faced by a particular UK-based company currently or in the past year. The selected company is observed to require a specific turnaround of retrenchment strategy referred to as a revival measure for a company to overcome its strategic issues.

Therefore, a company selected for this particular research coursework is Unilever, and this company has gone through some significant strategic failures in the past few months due to which it needs the specific turnaround strategies which could convert their loss-making into a profitable position and provide competitive advantage (Shahri et al., 2020). Below the problems faced by Unilever will be discussed, which might occur due to unsuccessful strategies or ineffective decision-making.

Introduction to the selected company

Unilever is particularly a multinational organization based in the United Kingdom. It is developed through the Anglo-Dutch percentage, which acquires most of the globe’s consumer products, including foods, beverages, personal care products, and cleaning agent products ( Gilbert,  2017). This company is headquartered in the UK, employs almost 180,000 individuals, and has around forty billion yearly revenue worldwide.

The evidence says that the size of Unilever is too large because it is involved in huge-scale products, advertising, and marketing strategies. Like other large scales companies in the UK, Unilever is seen to invest much in gaining customer satisfaction but has also seen to make some strategic mistakes which now need turnaround strategies to cope up.

However, the marketing method through technological consumption is believed to be one of the most effective strategies acquired by Unilever, which differentiates the company from others ( Siddique et al., 2018). The simple vision of Unilever is “to deliver sustainable living commonplace, which is seen as the effective long-term strategy for the Unilever business to prosper and grow.”

As this case study is solely based on the strategic management approaches of the company and the issues faced by it, Unilever has always focused on building adequate comprehension of the consumer’s needs by engaging itself in producing customer-centric goods that comprise beauty products and food items ( Mustchin et al., 2017). The ultimate strategic goal of Unilever is to enhance people’s life quality on the local and global scale. While achieving this target, some strategies problems may occur, which can be fixed through implementing proper retrenchment strategies.

SWOT analysis

SWOT analysis of the company prospects the internal conditions of the business along with the external environment.

Strengths: Unilever acquires the strongest brands within the consumer goods industry, letting the company infiltrate the markets and achieve a competitive advantage. Moreover, the business growth of Unilever is assured by the company’s broad product mix. At the same time, economies of scale lead to increased production efficiency needed for effective pricing strategies (Cheng, 2021). A robust global market presence is another strength of Unilever, UK.

Weaknesses: imitable nature of Unilever’s products is the most highlighted weakness of the company. Regardless of Unilever investing heavily in its product development strategies, other companies can easily imitate and copy its products. Another major weakness of the company is the lack of diversification strategies to grow worldwide and outside the consumer goods industry ( Vergeer et al., 2021). The company is highly dependent on the retailers, which means it failed to incorporate an effective and sustainable platform for its consumers to buy products directly, i.e., digital shopping.

Opportunities: Unilever can diversity itself outside the consumer goods industry. Also, the company can introduce innovations in its health-related products after covid19. Market development can also enhance the business of Unilever by increasing revenues through sales in new marketing segments ( Bilovodska et al., 2018).

Threats: Tough competitive rivalry is the primary threat faced by the company. As discussed above, product imitation and the rising popularity of retailing brands are also threats to the company’s growth.

The above SWOT analysis has given a baseline to comprehend the problems, threats, opportunities, and weaknesses of Unilever’s company. However, for this coursework, we are supposed to come up with a particular problem faced by Unilever which needs to be fixed in the company through specific strategic management and turnaround strategy, which will be discussed below.

Discussion of the Strategic Issues

From the above discussion, the major strategic management problem which needs to be solved revolves around ‘business diversification and sustainability. Due to this issue, Unilever cannot move successfully through the covid19 and still finds it challenging to manage the strategies effectively ( Kpoku, 2021). Therefore, an effective turnaround strategy of change management is required for Unilever, UK.

Firstly, the strategic management of Unilever is weak due to its limited diversification outside the goods industry of consumers. This means that Unilever has not paid attention to market its business to the world through advanced techniques and marketing strategies, resulting in economic loss for the company. Unilever focused on new products but ignored them from mergers and acquisitions, implementing new technologies, and leading to digital marketing ( Galpin, 2019).

This problem needs to be fixed in Unilever. Also, due to this issue, Unilever does not substantially impact the customers. Due to poor online presence and technological consumption, the company is more dependent on retailers as if they are the only ones who can affect consumers’ buying behaviours.

On the other hand, sustainability of a business which is a trait of diversified business, is another major challenge faced by Unilever under strategic management. Unilever realizes that the company needs sustainable solutions to double its operations by reducing its environmental effects. However, the significant risk faced by Unilever lately is about assuring sustainability by focusing more on long-term commitments for environmental impact through targeting specific diversification strategic areas like sustainable product sourcing, water availability, greenhouse gases, and usage wastes ( Pant et al., 2017).

The major challenge observed for the company was the plastic packaging and other environmental issues, which the company failed to address during its strategic management. Therefore, managing the diversification and sustainable business environment is believed to be the major strategic problem faced by Unilever in the past few months, which needs to be solved.

Strategic Management Questions

1. What is the importance of diversification for Unilever, and how should the company implement advanced diversification strategies?
2. What are the expected outcomes of the sustainable business environment within Unilever, and how can the company move towards sustainable business solutions?

A Teaching Note

Purpose of the Teaching Note

The primary purpose of this teaching note is to develop model answers to the above question, where the description of the case study is given, and the strategic problems faced by Unilever are identified. Both questions will be answered in this teaching note as a conclusion, and each answer will comprise two or three possible solutions that Unilever can implement as the turnaround strategy. Moreover, the answers are given as recommendations about what the company should do and why the particular solution is appropriate or beneficial for the selected company.

Model Answers

Answer number one

Diversification strategy is the central part of strategic management for any business or industry. When a company is not open to change and innovation, numerous issues may arise, leading a business towards failure because the company cannot acquire new working environments and operating patterns.

Therefore, the Unilever company should implement a diversification strategy because it will reduce the risk towards the business growth by allocating investment and other strategies among multiple industries, financial instruments, and other categories. Moreover, the market resilience will be improved due to diversification strategies in the company.

Diversification is also referred to as an innovation that assures business success, and this has the ability to enhance the product attractiveness of Unilever by addressing the demands of health-conscious customers. Concluding why Unilever needs to diversify its operations, it can be said that if Unilever tends to expand its reach through diversification worldwide, it will be able to uncover multiple avenues and opportunities for sales and will experience rapidly increasing profits.

This turnaround strategy will help Unilever to hit high profitability, but for this, the company’s principal aim should be to minimize the risk of industry downturn. In this case, the implementation of innovative diversification strategies could enhance the brand image of Unilever, which the company can eventually use to protect itself from brand imitation and dependency on retailers.

This section of the answer will provide two solutions to the identified strategic management problem of the lack of diversification strategies in Unilever, UK. Firstly, Unilever should move towards a horizontal diversification strategy. According to this solution, the company should introduce new products or services that could value consumers and attract recurring customers. Covid19 has brought a lot of business opportunities for the companies, and many new businesses are initiating. Thus, Unilever can introduce such health-related products as Covid19 kits, masks, and other hygiene products, which are unique and fulfill the needs of consumers effectively.

Moreover, Unilever should introduce such brand new products into its current offerings to expand its market share and global presence either within new market segments or the current market using the technology. From new market segments, it can also be considered that Unilever can use mergers and acquisitions as a diversification strategy.

The company can initiate its merger with health or pharmaceutical companies etc. Secondly, as discussed above that because of limited diversification, the company often faces low profits and high losses. Therefore, Unilever should also implement a defensive diversification strategy. The company should stop selling its too old products and bring innovation in its existing but in-demand products. Through this strategy, Unilever will achieve a competitive edge and not lose out to its competitors.

Answer number two

As critically discussed above while discussing the case study, Unilever often fails to implement sustainable business strategies, due to which the company suffers in terms of profitability and brand image. Unilever has an opportunity to be more sustainable and environmental friendly which will help the company to attract and retain environmental and socially conscious customers.

Regarding the anticipated outcomes of the sustainable business environment within Unilever, it can be claimed that the business productivity will increase and the operative costs will decrease. The usage of sustainable business practices among strategic management will need less effort. It will conserve the resources, which will result in enhancing employee productivity within Unilever and reduce costs. The initiation of sustainable business alternatives will help to reduce wastes. The environmental sustainability within the company will lead to better outcomes in terms of business profitability, improved brand image, and competitive advantage.

This section of the teaching note will provide two major solutions to this strategic management problem faced by Unilever. Firstly, Unilever should implement sustainable strategies within its strategic management regarding the carbon footprints of the goods and services manufactured in Unilever. Therefore, the company needs to set up a specific system using advanced technologies to depict the carbon footprints of the products on every invoice. Within this solution, Unilever is encouraged to gain a deforestation-free supply chain. The company does not have to cut the forests but can gain this supply chain through digital technologies like geolocation tracking, satellite monitoring, and blockchain.

Furthermore, to address the problem of plastic packaging, which Unilever was unable to tackle within its strategic management, the company can implement new and sustainable practices to deal with this problem. Unilever should develop a detailed strategic plan including the strategies and rules to deal with visible environmental issues in the consumer goods industry.

Later on, the company should introduce alternative ways in place of plastic packaging. New targets should be developed in which Unilever aims to use virgin plastic or paper-plastic and lead to a plan of how the plastic waste can be collected and processed into sustainable and renewable energy. In this way, Unilever can be a sustainable actor in the business world and achieve many benefits in multiple forms.

Furthermore, the company should monitor its strategies about how the new products are being manufactured and whether they follow sustainable practices. This will provide a long-term environmental, social, and economic benefit to Unilever, which is the part of corporate social responsibility ( CSR) that should be applied to any business’s strategic management spectrum.

References:

Bilovodska, O., Syhyda, L. and Saher, L., 2018. Supply chain management: world’s companies experience. MIND Journal, (5), pp.1-17.

Cheng, Y., 2021, February. Analysis of the Opportunities and Challenges of Unilever’s Differentiated Competition Using SWOT and PEST. In 6th International Conference on Economics, Management, Law and Education (EMLE 2020) (pp. 280-284). Atlantis Press.

Galpin, T., 2019. Strategy beyond the business unit level: corporate parenting in focus. Journal of Business Strategy.

Gilbert, M., 2017. Plastics materials: Introduction and historical development. In Brydson’s plastics materials (pp. 1-18). Butterworth-Heinemann.

Kpoku, O.K., 2021. Positive and negative influence of globalization on international business actors’ activity (on materials of Unilever Group) (Doctoral dissertation).

Mustchin, S. and Lucio, M.M., 2017. Transnational collective agreements and developing new spaces for union action: The formal and informal uses of International and European framework agreements in the UK. British Journal of Industrial Relations, 55(3), pp.577-601.

Pant, A. and Ramachandran, J., 2017. Navigating identity duality in multinational subsidiaries: A paradox lens on identity claims at Hindustan Unilever 1959–2015. Journal of International Business Studies, 48(6), pp.664-692.

Shahri, M.H. and Sarvestani, M.N., 2020. Business model innovation as a turnaround strategy. Journal of Strategy and Management.

Siddique, F.B. and Sultana, I., 2018. Unilever Sustainable Living Plan: A Critical Analysis.

Vergeer, L., Vanderlee, L., Sacks, G., Robinson, E., Mackay, S., Young, L., Mulligan, C. and L’Abbé, M.R., 2020. The Development and Application of a Tool for Quantifying the Strength of Voluntary Actions and Commitments of Major Canadian Food Companies to Improve the Nutritional Quality of Their Products. Current developments in nutrition, 4(10), p.nzaa151.