Date post: | 07-Nov-2014 |
Category: |
Documents |
Upload: | sarabjit-singh |
View: | 418 times |
Download: | 69 times |
Case Analysis of Gujarat Co-operative Milk Marketing Federation Limited
Submitted to
Dr. Purva Kansal
University Business School
Panjab University, Chandigarh
On
09 March 2013
In
Partial fulfillment of
Masters of Business Administration (MBA)
By
Aseem Soi
Sarabjit Singh
Sahil Khanna
Vaibhav Trikha
EXECUTIVE SUMMARY
In today’s competitive world while entering in the market it is very necessary
to have good knowledge of the potential of a particular market. The growth
of a company is invariably determined not just by its strategy, but on how it
responds to the challenges it
encounters. Over the decades AMUL has successfully countered several
challenges that have come its way with innovative responses and continuous
improvement, which have enabled it to remain stable and even convert
some of these challenges into opportunities. It is the culture of endurance
that has accorded AMUL the insight and focus to deal with the current
economic environment. Drawing from its inner strength and beliefs, AMUL
responded by launching several initiatives across all its operations in various
geographies that are helping the group achieve growth even in current
times. It is also this very strategic culture that will propel AMUL to continue
on its growth trajectory in years to come.
The report provides a comprehensive insight into the company, including
business strategies and operations, by using strategic analysis models such
as industry life cycle,
porter’s 5 forces and also the key success factors index, SWOT analysis. We
have reported an assessment of the internal and external environment of
AMUL dairy, considered its strengths and weaknesses, opportunities and
threats, its competitive advantages that are valuable for the efficiency and
effectiveness of its operations. Based on the information obtained from the
above assessments, we analyzed its strategic matrix and generated several
strategic options to attain its strategic options more successfully has been
made. Lastly we have included in this report, the usefulness of applying
these management models for AMUL dairy.
1 | P a g e
Table of Contents
Executive Summary 1
1The External Environment Analysis 3
1.1Pest Analysis 3
1.2Porter’s Five forces Model6
1.3SWOT Analysis 9
2Value Chain Analysis 11
3Amul’s Business Strategy 13
3.1Industrial Life Cycle 13
3.2BCG Matrix 14
3.3Ansoff Model15
3.Financial Ratios Analysis 17
3.5TOWS Matrix 18
4.1Porters’s Generic Strategies 20
4.2Future Options 20
4.3Implementations of New strategies 21
4.4Usefulness of strategic Management Models 22
2 | P a g e
Internal Environment
Structure Culture
Resources
Task Environment
(Industry)
Societal Environment
Technological Forces
Political-Legal Forces
Sociocultural Forces
Economic Forces
Stockholders
Governments
Suppliers
Employees/ Labour Unions
Special interest groups
Customers
Creditors
Communities
Competitors
Trade Associations
1. The External Environment Analysis:
1.1 Pest Analysis
Political Factors:
The Indian processed dairy industry has grown and diversified enormously in the last few years.
To ensure the proper development and growth of this industrial sector, the Government of India
has instituted various laws and regulations.
Prevention of Food Adulteration Act, 1954
This Act is the basic statute that is intended to protect the common consumer against the supply
of adulterated food. This specifies different standards for various food articles. The standards are
in terms of minimum quality levels intended for ensuring safety in the consumption of these food
items and for safeguarding against harmful impurities and adulteration.
Milk and Milk Product Order (MMPO) 1992
3 | P a g e
The Milk and Milk Product Order (MMPO), 1992, issued on June 9, 1992 seeks to ensure the
supply of liquid milk, an essential commodity, to consumers by regulating its processing and
distribution. Within eight years of its operation, the Central/State Registering Authorities have
till December 2000 registered 666 units with a total processing capacity of 65.8 million litres per
day (mlpd).
Export (Quality Control & Inspection) Act, 1963
The Export Inspection Council is responsible for the operation of this Act. Under the Act, a large
number of exportable commodities have been notified for compulsory pre-shipment inspection.
The quality control and inspection of various export products is administered through a network
of more than fifty offices located around major production centres and ports of shipment.
Economic Factors:
Amul Dairy” is working in the best area of Anand in Kaira District. This is very good for dairy
industry.Some benefits arising out of this location as follows:
1) Cheap Labour
2) Cheap Land
3) Cheap water supply
4) Constant Electric supply
5) Constant Water Supply
6) Suitable Nature and Environment
Social Factors:
Life Style Trend With more money on hand, more and more Indians are drinking milk and
buttering their bread. Rising income levels have led to a rapid increase in the consumption of
milk and milk products among Indian households.
Day by day the need of milk is continuously increase. In the year 1972 average requirement of
the milk per capita is 172 per gram. While in 2000 the requirement 215 gram per year. So there
will be more demand or milk and milk products in nearer future.
4 | P a g e
The consumption of milk is highest in north India that is 278 gram per day, while in west region
174 gram per day. In eastern and southern area combines 215 grams per day require. 46% of the
total milk is consumed in liquid form and 47% is converted into ghee, paneer and ice cream and
only 7% milk goes for western products like powder, cheese etc.
The 98% of the milk produced in the rural area which is cats of 72% of the population whereas
the urban sector with 28% populations.Even in urban India India as high as 83% of the
consumed milk comes from the unorganized sector.Presently only 12% of the milk is represented
by packaged and branded pasteurized milk.
Technological Factors:
Some areas of Indian dairy industry can be strengthened by the induction of specialized
technologies and equipment from overseas. These include:
Raw milk handling: It needs to be upgraded in terms of physico-chemical and microbiological
attributes of the milk collected. The use of clarification and bactofugation in raw milk processing
can help improve quality of the milk products.
Milk processing: Better operational efficiencies are needed to improve yields and reduce
wastage, minimize fat/protein losses during processing, control production costs, save energy
and extend shelf life. The adoption of GMP (Good Manufacturing Practices) and HACCP
(Hazard Analysis Critical Control Points) would help manufacture milk products conforming to
international standards.
Packaging: Another area is the range of packing machines for butter, cheese and the like. Better
packaging can help retain nutritive value of products packed and extend shelf life. A cold chain
distribution system is needed for proper storage and transportation of dairy products.
Value-added products: There's immense scope for value-added products like desserts, puddings,
custards, sauces, mousse, stirred yoghurt, nectars and sherbets.
IT Technology “Smart dairy Solution” a comprehensive solution portfolio that addresses the
unique needs of Dairy plant management. It provides a simple but complete business solution to
efficiently meet a wide variety of general and Dairy-specific business requirements
5 | P a g e
1.2 INDUSTRIAL ANALYSIS: PORTER’S FIVE FORCES MODEL
1) Threats Of New Entrants :
i. Economies of Scale: GCMMF enjoys economies of scale, which is difficult to match by
any other competitor. It is because of his reasons that no regional competitor has grown
to a national level.
ii. Cost and Resources advantages: Amul dairy is co-operative society. That means
“cooperation among competitive is the fundamental principle. Amul dairy is managed the
norms of GCMMF and market the products under the brand name „Amul‟ which has
very good reputation at domestic and international level. Here the raw material
procurement is very difficult for the new entrants. Consequently capital requirement is
also high. Still new entrants are moderate.
iii. Brand preferences and consumer loyalty: there is an immense level of Brand preference
of Amul in the mind of the people. The level of preference specifically in the liquid in the
milk sector is that would go to other retailer if the retailer does not have milk.
6 | P a g e
Rivalry:Competitive rivalry is very
high due to the presence of local players
and other established and
upcoming brands
New Entrants :
Threats of New Entrants, as there are no
entry barriers
Customers:Customer has the bargaining power due to
the presence of various
competitors
Substitute Products
High availability of other
product causing the threat of substitution
Suppliers:Rural milk
producers are the major
suppliers which makes their bargaining
power limited
iv. Access to distribution channels: The distribution channel of GCMMF is a very planned
and perfect one. For any new entrant to enter it would be a very difficult task. For
GCMMF the result is years of hard work and its investment in its employees as well as at
different levels in the distribution network.
v. Inability to much the technology and specialized know- how of firms already in the
industry: The technology used by Amul is imported from Denmark. It is a state of art
technology in India, a firm would require a huge amount of resources.
vi. Capital Requirements: the total investments required in the industry is huge and is a
decision worth considering even for MNC‟s . The investments decision cover the
processing costs as well as marketing costs. To compete with the brand Amul in India is
difficult as Amul is synonymous to Quality.
vii. Amul dairy is co-operative society. That means “cooperation among competitive” is the
fundamental principle. Amul dairy is managed under the norms of GCMMF and market
the products under the brand name ‘Amul’, which has good reputation at domestic and
international level. Here, the raw material procurement is very difficult for the new
entrants. Consequently Capital requirement is also high. Still new entrants are emerging
such as domestic and international players. So the treats of new entrants are moderate.
viii. Government rules and regulation are not favourable for new entrants. Raw material is
also depending on the villagers who are mostly depend on good rain. In the seasonal
uncertainties will also restrict the new entrants to establish the new plant.
2) Bargaining power of supplier :
i. The objective of Amul dairy is not profit making. As it is a part of co-operative society, it
runs for the benefit of farmers those are the supplier of milk and users of milk product.
According the concept of the cooperative society supplier has bargaining power to have
a good return on his or her supply. However, supplier has limited rights to bargain with
the cooperative society because it made and run for the sake of mass not for individual
benefit.
7 | P a g e
ii. There is moderate bargaining power of the supplier. In olden days there were not any
kind of cooperative societies as the farmer was exploited. But, nowadays the farmer’s
right has been protected under the cooperative rules and regulations, which ultimately
result in moderate power of bargaining from the supplier.
3) Bargaining power of buyers :
Amul dairy is having state of the art technology bring down from Denmark German. And except
loose milk vendor mother dairy is the single district level seller of the milk. However the Amul
dairy is bound by the norms of federation. So, the pricing policy will be decided only by
GCMMF and customer would have not have bargaining power. In nutshell, the bargaining power
of the buyer is low.
4) Rivalry among competitors:The products of the most of dairy which are listed under the Gujarat cooperative milk
marketing federation are marketed under the one unique name ‘Amul’. Though, it is not having
competition from the domestic level. Amul dairy which is at the state level faces the competion
from Nestle, Britania, Gayatri dairy, sugam, Dairy dan. The major competitor of the Amul in ice-
cream category is HLL’s kwality wall’s.Although, dairy is not having tough competition from the
local players but international level it is exist.
5) Threats Of Substitute :Most of the milk and milk products substitute are very low. Milk powder can be taken as a close
substitute for the milk. In case of the ice-cream category the close substitute is cold drink and
soft drinks. So, the substitute of the milk and milk product is completely low.
8 | P a g e
1.3 SWOT Analysis
Strengths Weaknesses
1. Wide Range of Products
2. Economies of Scale
3. Low cost manufacturing
4. Strong cooperative org.
5. Global Player
1. Poor Management of logistics
2. Low investment
3. Perishability
4. Lower yield management
5. Problem in distribution
Opportunities Threats
1. Growing global demand
2. Greater Productivity
3. Export potential
4. Robust economic growth
5. Supply Chain Management
1. Competitors
2. Rising environmental costs
3.Milk vendors
4. Adulteration
5. Lower cattle yield
Strengths:The strengths for AMUL are product differentiation, Economies of scale, low cost
manufacturing and strong cooperative organization. The demand profile is absolutely optimistic.
While the margins are quite reasonable, even on packed liquid milk.
Weaknesses:The Weaknesses for Amul are Poor management of logistics, low investment,
perishability, lower yield management. Perishability is being overcome partially by UHT
technology. UHT( Ultra high temperature) gives a longer shelf life to milk and milk products.
Opportunities:As a Global Enterprise, Amul will be meeting global demands and ensure greater
productivity and the opportunity to enhance integration in order to increase efficiency and
effectiveness in the business. It has already wide geographic positions and hence it will give it an
advantage to get access to gain presence in mature markets. Efforts to exploit export potential are
already on, as Amul is exporting to Bangladesh, Sri Lanka, Nigeria and the Middle East. By
following the new GATT treaty, opportunities have increased tremendously for the export of
agric-products in general and dairy products in particular.
Threats :Local competitors are the major problem faced by Amul. They sell their products at a
lower price, since being a low capital company, they have fewer expenses to take care of.
9 | P a g e
Secondly, as the environmental costs are rising day by day, it’s getting tough to carry the same
pricing throughout. Thus cutting down the extra cost will surely help. Adulteration, also a major
threat to quality, takes place due to illiterate farmers from remote villages.
10 | P a g e
2. Value chain Analysis
The value chain, is a concept from business management that was first described and popularized by Michael Porter in his 1985.
To analyze the specific activities through which firm can create a competitive advantage.
1. Activities of Value Chaina. Primary Activities
i. Inbound logistics ii. Operations
iii. Outbound logisticsiv. Marketing & salesv. Services
b. Secondary activitiesi. Firm infrastructure
ii. Human resource managementiii. Technologyiv. Procurement
11 | P a g e
Amul’s Value Chain Process
12 | P a g e
3 AMUL’S Business Strategies
Amul’s Business strategies have twin objectives:
i. Long-term, sustainable growth to its member farmers
ii. Value proposition to a large customer base by providing customer base by providing milk
and other dairy products a low price.
3.1 Industry Life Cycle
Introduction Growth Maturity Decline
White revolution in India began in 1946 with two village cooperatives and 250 litres of milk per
day, nothing but a trickle compared to the flood it has become today. They came up with AMUL
as a brand name, which means ‘priceless’ in Sanskrit language. It has made India the largest
producer of milk and milk products in the world and the white revolution has finally created a
billion dollar brand.
13 | P a g e
The Industry life cycle has four stages. They are Introduction, Growth, Maturity and
Decline.Dairy industry as a whole falls under early stage of Maturity, this is because of the vast
range of products they offer to the customers domestically and internationally. Countries like Sri
Lanka, UAE, Australia, Honk Kong, China, Singapore, UK and USA have already started selling
Amul products of late.
3.2 BCG MATRIX
a. Cash cow
i. AMUL butter (normal)
ii. AMUL kool
iii. AMUL milk (fresh)
b. Stars
i. AMUL butter (low fat)
ii. AMUL tazza milk (packaged)
iii. Amul cheese
c. Question marks
i. AMUL chocolates
14 | P a g e
ii. AMUL lassi
iii. AMUL mithai mate
d. Dogs
i. AMUL nutramul
ii. AMUL shakti
3.3 Ansoff Model
The Ansoff matrix developed by Igor Ansoff is a very essential tool for strategic planning. It
helps the firm to identify the firms’ growth using the intensification and diversification strategy,
which aims at achieving growth through certain modifications in the firm’s existing business.
According to Ansoff model four different strategies are possible. They are –
Market penetration strategy: This strategy involves achieving growth through existing products
in existing market. Amul’s market penetration strategy involves its expanding its customer base
in the existing market.
Amul is set to build up 10,000 `Amul Parlours' across the country during the year.
These stores will sell the entire product range of Amul products, in addition to the
existing retail network for ice cream, milk and other products.
15 | P a g e
It is trying to get more and more customers through a more intensive distribution. It is
opening more stores at Highways, Railway stations, Airports, Bus stations, Schools,
Colleges, and Industrial Canteens etc.
Market development strategy: This strategy is concerned with creating business through
developing new markets with existing products. Amul is using this strategy to capture new and
unexplored sectors without creating new products.
Amul is now shifting its focus from urban to rural markets and smaller towns. In 2005
Amul added 900 new stores all across small towns to increase its reach.
Amul is capturing the market of diabetic and health conscious people through sugar
free ice-cream, which is a variation of an existing product.
Product development strategy: Product development deals with producing new products for the
existing customer base . Amul has vastly capitalized on this strategy by constantly coming up
with newer products.
Amul-Cool (milk based cool drink) and Amul-Kool café – these are the products aimed
at the youth of the country with synonymous marketing campaigns.
Stamina – the instant energy whey based sport drink has been launched to provide its
customers with a totally new product.
Amul-Masti, the packaged buttermilk is aimed to be another non-carbonated cool drink
in the Amul Cool range which is not only aimed at the youth but also at the more
mature society.
Diversification: Diversification is a very important part for any business organization. For
the further growth opportunities of a company diversification is required. When a new
product is launched into the new market diversification holds good and provides more
growth opportunities in the future. Diversification is a high-risk strategy as it involves
taking a step into a territory where the parameters are unknown to the company. Amul has
identified the need to increase its presence in newer markets and thus have come up with
many new such strategies for increasing its presence in the entire market.
16 | P a g e
3.4 FINANCIAL RATIOS ANALYSIS
Key Ratios 1993-94 1994-95 1995-96 1996-97 1997-98 1998-99Measures of Liquidity Current Ratio 1.044888 1.233886 1.014282 1.068432 1.217122 1.365361
Net Working Capital 64.28 217.28 23.28 132.28 300.28 425.28Operations Activity Ratios Inventory Turnover 10.37303 13.64281 14.5889 10.48786 14.41111 21.63962
Total Asset Turnover 3.184656 4.184885 4.228562 4.064071 5.849138 7.345097Leverage Measures
Debt-Equity Ratio 5.772328 6.879714 4.443161 2.36777 1.241562 1.026634Measures of Profitability Net Profit Margin 0.10% 0.15% 0.74% 0.62% 0.56% 0.72%
Return of Assets 0.33% 0.62% 3.11% 2.53% 3.28% 5.28%
Return on Equity 7.5% 11.3% 66.5% 31.8% 19.2% 24.1%Common Stock Ratios
Earnings per Share (EPS) 3.9% 6.7% 40.9% 38.9% 17.0% 26.0%
From the above table, following can be interpreted about the financial condition of the company.
Current ratio and Net working capital which shows the liquidity of the company is growing subsequently in the given years indicating the strong operating conditions of the company, as the optimum current ratio for any company is supposed to be around 1.2.
As compared to the industry averages of milk products, which was around 9 in 1993 and around 17 in year 1998, Inventory turnover ratio and total asset turnover of AMUL indicate that the products are replaced quickly in the market. This shows that AMUL has efficient demand and supply management.
Debt- Equity ratio is decreasing over the years showing betterment of financial health of the company thus increasing its credibility.
Net profit margin is also getting better for amul indicating betterment of operations resulting in increasing bottomline as compared to sales.
17 | P a g e
Earnings per share is also increasing year by year showing better returns for the investors and shareholders.
The summary of financial ratios analysis indicates that AMUL has significantly improved its operations in making value for its shareholders.
3.5 TOWS MATRIX
Strengths1. Wide Range of Products2. Economies of Scale3. Low cost manufacturing4. Strong cooperative org.5. Global Player
Weaknesses1. Poor Management of logistics2. Low investment3. Perishability4. Lower yield management5. Problem in distribution
Opportunities1. Growing global demand2. Greater Productivity3. Export potential4. Robust economic growth5. Supply Chain Management
SO Strategies-Increased productivity through cost effective manufacturing- Increase global demand through global exposure- Improve channel of distribution
WO Strategies- Increase of opportunity through new GATT treaty- Develop new process to improve the quality and shelf life of milk and milk products- Increase awareness of scientific development
Threats1. Competitors2. Rising environmental costs3.Milk vendors4. Adulteration5. Lower cattle yield
ST Strategies- Product eliminating and diversification- Value marketing- Hygienic processing facilities
WT Strategies- Efficient and economical procurement- Control over logistics and yield- Product positioning
SO Strategies (Maxi Maxi): Amul can use the strategies that have been formed after in depth
strategic analysis of the company and its industry. Some suggestions in this case would be to
increase productivity by using cost effective manufacturing techniques. Also, increased demand
for their products world over by first gaining more exposure to the global market. With the use
of expansion strategy, it can overcome the location issue, as Amul can expand more areas and it
will make the distribution of channel areas easier and convenient.
18 | P a g e
ST Strategies (Maxi Mini): Amul must put into action some of these strategic options to meet
the threats using its strengths. Product Differentiation is very important to differentiate Amul
from the competitors, as it can tackle down the competitor’s product if Amul products are more
outstanding and different from competitors’. Options available can be classified as product
elimination and diversification strategy, value marketing strategy and also developing hygienic
processing facilities.
WO Strategies (Mini Maxi): The strategies formulated to overcome the weakness through
opportunities are increase of opportunity through the new GATT treaty, develop new process
to improve the quality and shelf life of milk and milk products, this can be achived through
pasteurization, homogenization and many other processes like producing UHT milk etc. Finally,
Amul should also try to increase awareness of scientific developments.
WT Strategies (Mini Mini): The strategies that have been formed to overcome the weakness
and threats in Amul and the dairy industry as a whole are to apply efficient and economical
procurement of products. Secondly, to have control over the logistics and to maintain them
efficiently. Lastly, create the right type of product positioning for the various product categories
that Amul deals with.
19 | P a g e
4.1 Porter’s Generic StrategyThe three basic strategies are cost leadership, differentiation and focusing. According to Porter
(1985) "Each of the generic strategic involves different route to competitive advantage, the cost
leadership and differentiation strategies seek competitive advantage in a broad range of
industry segment, while focus strategic aim at cost advantage (cost focus) or
differentiation(differentiation focus) in a narrow segment."
Cost leadership: Products like ice-cream, chocolates, cheese etc. were always
considered to be premium product and were sold at a higher price. All players before
Amul targeted only the premium segment in the market. The high prices were due to
high production, refrigeration, distribution etc. Amul because of its less expensive
distribution channel and low raw material cost has been able to price its products
comparatively lower which has enable Amul to gain market share through cost-
leadership strategy.
Differentiation: Amul was the first to come up with different product, flavors varied in
health usage, product ingredient etc. It also used differentiation, by using associated
advertising by Indian made products showcasing patriotism, distribution channels etc.
Focus: Ice-creams, chocolates, processed milk product was mainly targeted at the youth
of India however, Amul brought about a change by positioning them as a family product,
and this increased the volumes of consumption. Thus by pushing its product at a
untouched market segment they witnessed a gain in market share.
4.2 FUTURE OPTIONS
Product Positioning: Placing a product in that part of the market where it will receive
afavorable reception compared to competing products. In case of Amul it has apositioning
strategy and it is “The taste of India”. This had created value for everyone inthe value chain, be it
customers or the suppliers/farmers. The USP for Amul is Qualitywith affordability, which
appeals to most of the targeted markets.Amul positioned itself with India’s first pro-biotic
wellness ice cream and sugar freedelights for diabetics. This was based on good strategies of
positioning which helpsincrease awareness and also improve brand image. They expanded their
20 | P a g e
products interms of those that can be used even by those who are restricted from consumption
dueto medical reasons. Amul also priced their products such that it made competitor“kwality
walls” rethink their marketing/pricing strategy. This type of product positioninghas proved
beneficial to amul and so they must come up with many more of such ideasand products that can
help them move forward.
Product Elimination and diversification: Product elimination is when the productreaches the
stage where continued support is no longer justified where performance isfalling short of
expectations; it is desirable to pull the product out of the market place. Inthis case Amul
eliminated one such product that was bottled water called “JALDHARA”this was done as they
noticed that this product did not have many potential customers tolast in the market. Product
diversification is where seeking unfamiliar products ormarkets or both in the pursuits of growth.
Therefore Amul in this category too had aphilosophy that was followed. They had progressive
addition of higher value productswhile maintaining the desired growth in existing products.
Secondly Amul introducedproducts with consistent value addition but never left the core
philosophy of “ providingmilk at a basic affordable price.”
Amul must also use a value marketing strategy, which provides a product that works asclaimed,
and is accompanied by decent service, and is also delivered on time. It mustinclude and provide
the following: i.e. commitment to quality, value for money, thegeneration for awareness and
finally foster loyalty.
4.3 IMPLEMENTATION OF NEW STRATEGIES
Product Positioning:
System: Product improvisation-Amul must try and improve on certain products thatare or as
popular as the other products like butter, milk, and ice cream. This does nothave to be done only
after having a clear marketing research. These are a fewcommon actions that must be taken.
Structure: Amul hoardings are successful, but there is a need to advertise by cablechannels,
newspapers etc to reach the rural areas. For improvisation they must focuson advertising to gain
more awareness for those products.
Policy: It must include strengthening of liquidity and working capital in order to bemore
successful while trying to create awareness. Also to maintain the quality of theproducts as the
percentage of perishability is very high for these products.
21 | P a g e
Product Elimination & Diversification:
System: Supply chain add-ons must be further strengthened for easierdiversification of the
products. Also to venture in to new fields such as processedfood, vegetable and fruits.
Structure: Venture into the above-mentioned fields is a good option as they can usethe same
Anand Pattern to carry on its operations. Therefore strategizing won’t takemuch of time and
more over this will give higher margins
Policy: They must achieve diversification and elimination of products through agood research
system and also analyze the strengths, weaknesses, threats andopportunities. Amongst them they
must try to nullify the threats and weaknesses.
4.4 USEFULNESS OF STRATEGIC MANAGEMENT MODELS
There were several models that were applied so as to assess the competitive environmentof
AMUL and to develop and generate more strategic options for the company. Briefdescriptions on
the usefulness of the models being used in the company analysis aregiven.
Industry Life Cycle: this model came to use as a useful tool for analyzing theeffects of an
industry’s evolution on competitive forces. It is important to understandthe use of this model
because it is a survival tool for businesses to compete in theindustry effectively and successfully.
I have identified that the current dairy industryis positioned in the early maturity stage. As the
global demands have pushed the barsway high comparatively.
PORTER’S 5 FORCES: This model is useful to analyze the competitive industryenvironment
and business strategy development. This analysis helped me understandthe strengths of AMUL’S
current competitive position. Its objective was toinvestigate how the organization needs to form
its strategy in order to developopportunities in its environment and protect itself against
competition and otherthreats of substitutes, power of suppliers and buyers.
SWOT ANALYSIS: This can be very helpful for recognizing and analyzingorganization’s
internal strengths and weaknesses, as well as the externalopportunities and threats faced by the
organization. By understanding these fouraspects of its situation, the company can better
22 | P a g e
leverage its strengths, correct itsweaknesses, capitalize on golden opportunities, and deter
potentially devastatingthreats.
TOWS MATRIX: This matrix is very useful for generating a series of alternativesthat the
decision makers of a company or business unit might not otherwise haveconsidered. It can be
used for the organization as a whole or for a specific businessunit within a corporation. In this
report it was useful in analyzing the strengths of thecompany and how it can be used to generate
strategic options by taking advantage ofthe opportunities and to avoid threats. Also to generate
strategies that take advantageof opportunities to overcome weaknesses, minimize weaknesses
and avoid threats.
23 | P a g e