California Pizza Kitchen Essay

A ac superior school societys strategic choices shape how that star sign allow operate and react to the intention of its own imaginativenesss as tumesce as the affects of external factors. These choices ar typically upset(a) down into single of our distinct strategies ( embody leadership, speciality, recessional focus, and first movers prefer) and utilise as management guarantees fit. In analyze California Pizza Kitchen (CPK) literary productions, mavin pot easily decipher that their important step forwardline is differentiation with portions of first movers return tied in.CPK is truly generate about the approach as carte du jour intro is one of their key apprizes. Having identify this dodge this paper visualizes to review this scheme over against belatedly performed SWAT analysis to see how it is affecting CPKs strategic choices. It get out discuss whether those strategic choices remaining in line with its differentiation scheme. Additionally, thi s case deliberate will determine whether the differentiation schema and CPKs strategic choices create rivalrous advantages or argon they creating weakness that motif to be addressed and countered with some of CPKs strengths.Finally, a brief discussion on CPKs mission and plenty will be incorporated against the passings to determine what CPK is doing responsibility and what they could possibly transport to improve is matched position. Corporate Strategy Porter tells us that firms position themselves by leveraging their strengths. He argued that strengths in the end fall into one of two headings salute advantage and differentiation (Quickmba). CPK chooses and specifically points out differentiation as its main strategy.In its 2009 financial underwrite, CPK states, We believe that our concept, attractive toll- repute family and prime(a) of solid food and service enable us to differentiate ourselves from our competitors. Differentiation is a combative business strategy whereby firms strive to gain a competitive advantage by increasing the comprehend entertain of their results and/or services relative to the perceived nurse of other firms products and services. Implementation of differentiation strategy subject matter that the value is provided to guests finished unique features and characteristics of the societys products as op constitute to the last-place price.A successful differentiation strategy will create guest value that is perceived as much(prenominal) by its customers. Differentiated goods and services satisfy the need of customers by a sustainable competitive advantage. CPK differentiates itself through product quality through the use of quality ingredients, menu designing and innovation, and expanded services and offers beyond their main eat understand. This all falls under(a) subcategory of differentiation known as grapheme Strategy, which sets CPK a ploughshare from its competitors.As a result of this quality, CPK h as shufflinged itself through a very loyal customer rootage that consistently tradeplaces for the company through party reviews and word of mouth advertising. Firms that succeed in differentiation strategy very much realize the following internal strengths (QuickMBA) Access to booster cable scientific investigate Highly ball-hawking and creative product development aggroup Strong gross sales team with the tycoon to successfully communicate the perceived strengths of the product Corporate reputation for quality and innovationDue to towering levels of rivalry in the food industry there is unendingly an incentive to be groundbreaking and constantly improve. There is also al modes the break that any differentiation could be copied by competitors. Therefore, innovation remains a extensive part of CPKs differentiation strategy as well as one of its core values. As proof of this, CPK literature is littered with the idea of menu innovation, elaboration of service opt ions such as the freshly items, smaller express stores and harvest-time/development in the frozen and fresh foods commercialise in grocery stores.This philosophy is non just talk however. CPK backs this concept with military action through the continuous research and military rank of various food ingredients, products and supplies for consistency and food safety. This research is compared to detailed specifications developed by CPKs products teams supremely leading to high food quality standards. As mentioned in this authors previous studies, this research provides intellectual capital as well as contri neverthelesses to the innovation capability as CPK remains at the forefront of and often dictates market changes (Haas1).This capability or competitive advantage is what also gives CPK some of its runner Mover advantage. CPK operates as one of the pioneers of bonus pizza (a recessional market). Therefore they were one of the first to develop the products creating benchmark and standards for the market. This provides them with the advantage of say-so lower costs (Golder & adenosine monophosphate Teller) from intellectual capital and development experience as well as creates emf barriers for other competitors to switch products.It also gives them former(a) recognition and consumer preference (QuickMBA) trim back the chance of the threat of ubstitution. This further accessions the strategy of differentiation as well in that customers flex attached to CPKs differentiating attributes. Additionally, because CPK focuses its main products on a niche market ( bounteousness pizza), it has been able to pass over to dispense its products at a more premium price and break off absorb the economic upturn of inflation. Strategic Choices The state of the economy, the downsizing of available income and the high unemployment have all posed large threats to the full service dining industry.The trustworthy economic environment has in particular played into CP Ks strategic choices recently as they have had to compete to state revenue, stifle costs and keep customers who are more and more turning to substitutes such as fast food or home cooked meals in an attempt to allay money. This has non deterred CPK completely from its differentiation strategy. In fact, Rick Rosenfield (CPK, Co- CEO) stated the company was work to reverse declining sales by offering a new menu (LATimes), again playing on their strength of innovation.However, it has constrained CPK to consider other approaches in the government agency that the attack the market and expand their business. This gives CPK an probability to address one of its major weaknesses at the same time. CPK has over 40% of its stores set(p) in California. This has created a lack of geographic diversification. Therefore CPK is looking to expand beyond California and has even looked to go outdoors the US as it believes its full-service eating houses will continue to represent the majority of revenue growth in the near term.This expansion plays into CPKs modernistic approach to business. For the most part CPKs management has looked to expand revenues through new markets and menu options. However, the economic downswing has forced CPK to look internally to narrow cost as a representation to maintain or adjoin revenue. Therefore, CPK has steady down to not only look at foreign markets as a way to diversify its revenue stream but it will also leverage its brand name and reputation through is expanding in alive markets to consolidate marketing, human resource and supply chain costs.These choices are a good start, however CPKs sales have been down and the diversity of the market has not helped CPK to recover its losses. Because CPK works with high quality ingredients and unique menu items which change regularly there is less means for supply chain cost reduction. The innovative approach that makes CPK unique and differentiates it from its competitors could also potent ially be preventing it from reducing costs and alter available efficiencies. It acts almost as a Catch 22 if you will.Further, CPK run the potential pitfalls of risk listed below (Openlearningworld. com) Customers may resolve cost of uniqueness is too high Means of differentiation no yearner provides value to customers Customers learning may reduce customers perception of companys differentiation Counterfeit goods learn the same differentiation at a discounted price Ultimately this forces CPK to continue to increase value to customers by means of reducing prices, adding product features without raising prices or evolution better efficiency in its value chain.Mission and Vision As expound in previous research (Haas2), CPK does not formally identify its mission and peck by these names, therefore some description is required for anyone looking for such designation. CPK intends to be the leader in authentic California-style cuisine and to be widely known for its innovative m enu items. To achieve this, CPK intends to provide a range of creative dishes, from signature California-style fireside baked pizzas, creative salads, pastas, soups and sandwiches to extensive beer and fuddle lists with a full bar.In fracture 1, Item 1, Business of the 2009 annual report readily identifies the companys objectives, as To extend our leadership position in the restaurant and premium pizza market by selling innovative, high quality pizzas in addition to creative salads, classifiable pastas and related products and by providing exceptional customer service, thereby building a high degree of customer loyalty, brand cognizance and superior returns for our stockholders To reach these objectives, We (CPK) plan to increase our market share by expanding our restaurant base in new and existing markets, leveraging our partnerships in non-traditional and retail channel and offering innovative menu item. Reviewing these statements affirm that CPK has a solid mission and visi on that incorporate its corporate strategy very well. Innovation and quality are the cornerstones of CPKs mission which are fundamental factors in a strong differentiation strategy.However, CPK mustiness be care not to become so focused on its current strategy that is forgets to measure pressures of external forces as well as the need for cost reduction that are weighing intemperately in its business and profits. Without careful regard of competitors, economic factors and internal stresses CPK may be forced to look elsewhere for documentation which it has considered recently in its attempt to glom the company to new external buyers.It is suggested that CPK look carefully at its current strategy as compared to that of its competitors to see if it can better leverage its internal strengths and potential for operational efficiencies because price may be the ultimate downfall as many competitors are finding ways to incentivize customer value through lower prices, additional options or more product for the same price to maintain customer base. This could be a battle that CPK could fail at if it does not keep pace or find a way to show consumers its value.