Strategy: Managing the Business Enterprise 1

Strategy: Kudler and Technology

Charmaria S. Gurley
University of Phoenix

MBA 502

Dr. Gloria Rembert

July 23, 2007
 Strategy: Managing the Business Enterprise 2

Kudler and Technology

The change in technology creates business opportunities in every sector of the market.

Technology changes the way a company assess competition and conduct business with everyday

processes. This analysis will assess how changes in technology have created business

opportunities for Kudler. This analysis will identify the generic strategy Kudler is using; it will

identify tactics that will help Kudler realize the strategy. This analysis will also describe how

Kudler’s management can continuously scan the fine foods grocer industry for ideas tat will

allow it to update its strategy.

Technology

The increase use of technology has changed several sectors in the market. For example,

in Singapore you can now buy a drink from a vending machine by using your mobile telephone.

At the Federal Express, as well as other couriers, website you can track and schedule pickup of a

package. There are several internal and external process enhanced by technology. This section of

the analysis will identify how changes in technology have created business opportunities for

Kudler in the following areas: networking, operations management, marketing, and human

resources.

Before technological enhancements employee files, customer data and policy manuals

were held at a central location. With the intervening technology of shared databases and

information highways Kudler is able to share information over the three store locations.

Currently Kudler uses Intuit’s Quick Book software to share employee personal information, pay

rate, hire date, and seniority date. With this advancement, Kudler is able to forecast scheduling

and budget information over the three sites. Before the information highway companies used

conventional means such as, word of mouth, radio, and television and paper adverstiment to
 Strategy: Managing the Business Enterprise 3

promote its services. The information highway has also allowed Kudler to promote its services to

a broader audience – around the world.

Technological advancements have also changed the way inventory and back end

processes are executed. In all three stores, the point of sales network is interfaced with the

inventory network. This connections allows Kudler to track and order merchandise without

manually counting the items on the shelf. This technology also allows Kudler to manage

inventory decision-making process between the three stores. Kudler could also link its system

with its suppliers and automatically orders needed merchandise without making a traditional

order request.

Generic Strategy

Firms implement strategies to adjust to environmental factors. Kudler uses the concentric

diversification strategy. The concentric diversification strategy is when a firm creates or acquires

new businesses related to the firm’s core business. Kudler’s core business is in the grocer

industry. Kudler has created several businesses related to the grocer industry, such as, cooking

classes and catering services. The concentric diversification strategy is advantageous because it

allows Kudler to operate the other businesses at a lower cost. Reduce cost and increase revenue

is two strategies Kudler tries to achieve.

Kudler has two options in deciding its business level strategy. Kudler can select either the

cost-leadership strategy or the differentiation strategy. Based on the nature of the firm Kudler

utilizes the differentiation strategy. The differentiation strategy allows Kudler to deliver unique

products and services. This process requires Kudler to assess the market, its customers and the

grocer industry on a regular basis.

 Strategy: Managing the Business Enterprise 4

Tactics

Kudler has several initiatives in place. The opportunity to increase revenue is one

objective for Kudler. One way to increase is to expand the services that are offered. Kudler offers

in store parties. These in store parties show customers how to prepare specialty foods. Kudler

hopes that allowing more in store time will increase revenue per visit. This tactic ties directly in

with Kudler’s frequent shopper program. The frequent shopper program is a revenue-increasing

tactic. Kudler tracks consumer purchasing and provide high value incentives based on the

accumulation of loyalty points. Kudler has also researched ways to reduce cost reduction as a

tactic for increasing revenue through increased efficiency. Kudler is benchmarking Nordstrom

department store to find new ways to improve internal and external processes. With the

benchmarking tactic, Kudler hopes to find ways to operate more efficiently.

The tactics implemented has helped Kudler achieve the goal of increased revenue.

Although Kudler has increased revenue through implementing the cooking classes and the

frequent shopper programs it was the opportunity to realize its strategy through various tactics.

For example, Kudler could implement meal bundling grocery package. The meal bundling tactic

would provide a complete bundle of products for a particular meal. If a consumer was interested

in cooking a meal containing wine, cheese and a protein, Kudler could bundle all three items

together and offer a discount. This tactic would ensure revenues increase. Another tactic to

reduce cost and increase revenue is an early bird program. With the early bird program, Kudler is

able to offer consumers a slight discount when they chose to shop during off peak hours.
 Strategy: Managing the Business Enterprise 5

With the increase use of technology, Kudler could implement programs that provide

consumers with incentive to initiate or order products online. If consumers opt to have certain

products sent to them directly Kudler would be able to hold less inventory. All programs

identified would help Kudler realizes its strategy of increased revenue and decreased costs.

Management

Currently, Kudler uses several tools to assert itself as a competitive force in the fine food

industry. In order to remain competitive in the grocer market it is advantageous for Kudler to

continue to scan the fine grocer industry and obtain data that will allow it to update its strategy.

Kudler could analyze its closest competitor to assess ways to update the firm’s strategy. This

process can be achieved through forming strategic group. Through the strategic group Kudler

could realize opportunities in identified in its competitors. Kudler could also conduct competitor

analysis. With the competitor analysis, Kudler would review public financial documents, attend

trade fairs and study company brochures to identify competitor goals, objectives and strategies.

Kudler continues to incorporate efforts that may aide them in achieving its mission.

Kudler has implemented consumer loyalty initiatives and added cost reduction services. These

efforts together with Kudler’s strategy – providing a delightful and pleasing environment – and

its tactics will ensure Kudler remains a competitive force in the fine food industry.
 Strategy: Managing the Business Enterprise 6

Reference

University of Phoenix. (2005). Kudler’s mission statement. Retrieved July 23, 2007, from

University of Phoenix, rEsource, Simulation, MBA 502 – Kudler Fine Foods website.