Download - Business Strategy Game Presentation
Mission Statement
"We are committed to delivering the highest quality shoes to our customers that are made
responsibly in an ethical, diverse setting."
Strategy Formulation
Initial Broad Differentiation Strategy
● High Quality Shoes at a High Price Point
● Higher S/Q Rating than competitors
● More models and more advertising
● Retain loyal customer base with rebates and more retailers carrying the products
● Best practices training to employees to provide excellent customer service
Financial Objectives Short Term:
● Maintain a credit rating of B+ through the first two years
● Maintain a return on equity investment of 15% or more annually.
Long term:
● Grow earnings per share 7% annually through first five years, and 5% annually after.
● Achieve stock price gains of 7% through the first five years, and 5% annually after.
Strategic Objectives
Short Term● Construct an upscale brand that was the leader for its quality product offering and
use of superior materials.
● Consistently be the leader in advertising and marketing as well as recognized in the global shoe industry.
Long Term● Achieve an image rating of 70+ within the first 5 years.
● Incrementally increase prices for our products to remaincompetitive.
Strategy & Tactics● Invest in environmentally responsible practices to improve our CSR.
● Achieve maximum capacity in plants as well
as invest in upgrade options A and D for the
North American Plant.
● Free shipping as well as a mail-in rebate.
Adjustments
● Corporate Citizenship○ Use of Recycled Boxing and Packaging○ Energy Efficiency Initiatives○ Charitable Contributions○ Ethics Training and Enforcement○ Workforce Diversity Program
Adjustments
● Sales Forecast○ Inventory Clearance
● Plant Capacity○ Purchase/ Sale of Capacity○ Upgrade Option A and C at N.A. Plant and Asia Plant
Adjustments
● Branded Production○ Achieve highest S/Q rating○ TQM/ Six Sigma Quality Program○ Compensation
Adjustments
● Internet Marketing○ Competitive Pricing○ Increased Models Offered○ Achieved highest S/Q rating○ Free Shipping○ Increased advertising
Adjustments
● Wholesale Marketing○ 200 models offered in the market
○ Competitive Pricing○ Rebates offered
○ Support Retail Outlets
● Celebrity Appeal○ Tiger Green
○ Oprah Letterman
● Private-Label Operations
Finance & Cash Flow
● Paid $1.50 Dividend● Repurchase 2000 shares @ $39.05 a share● Allowed Leah's Loafers to significantly raise
Return on Equity
Assessment - EPS● Board of Directors Expectations
○ 7% annually through Year 15○ 5% annually Year 16 on
● Competition○ Company F EPS○ Industry Overall
Assessment - ROE● Expected to have an annual return on equity a 15% or higher.
● Struggled year 11 at 4.6%
● Significantly better performance for years 12, 13, 14 and 18. All above 15%.
● Company F competition
● Overall industry
Assessment - Stock Prices
● Beginning Stock Price○ Year 11, $16.65
● Ending Stock Price○ Year 18, $101.02
Key Learnings
● Adapting Strategy to changing market○ product offering, pricing
● Celebrity behind Leah's Loafers○ Tiger Green
● Private-Label Operations