Case Study on "Waterford Wedgwood"

Case Study 25 pages (6390 words) Sources: 12 Style: APA

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Waterford Wedgwood Case Study

Waterford Wedgwood plc is a designer, manufacturer and marketer of branded luxury home products including: high-end crystal, fine bone china, fine porcelain, earthenware, and premium cookware. Employing nearly 10,000 people, Waterford Wedgwood is headquartered in Dublin, Ireland. Their primary operations, other than Ireland, include the United Kingdom, Indonesia, Germany, and Asia.

The company's primary brands include: Waterford Crystal, Wedgwood China, and Royal Doulton.

The three brands have come together to form one of the premier lifestyle product manufacturers in the world. This paper gives an analysis of Waterford Wedgwood, its internal and external environment and their strategies.

Waterford Wedgwood Case Study

Executive Summary:

Waterford Wedgwood plc is a designer, manufacturer and marketer of branded luxury home products including: high-end crystal, fine bone china, fine porcelain, earthenware, and premium cookware. Employing nearly 10,000 people, Waterford Wedgwood is headquartered in Dublin, Ireland. Their primary operations, other than Ireland, include the United Kingdom, Indonesia, Germany, and Asia.

The company's primary brands include: Waterford Crystal, Wedgwood China, and Royal Doulton.

The three brands have come together to form one of the premier lifestyle product manufacturers in the world.

Established in 1783, Waterford Crystal was first established in the heart of the Irish harbor town by the same name, by two brothers, William and George Penrose, to produce the fin

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est crystal for the home. More than two centuries later, Waterford has merged with Wedgwood and Royal Doulton to form WWRD Holdings plc.

Josiah Wedgwood, known as the founder of pottery, founded his Wedgwood Company in 1759. In 1986, the company became a division of WWRD Holdings.

The youngest of the three partnering companies, Royal Doulton, was formed in 1815 and became known globally for their fine tableware, gifts and collectibles. Distributed through premium department stores, independent retailers and wholesalers, Royal Doulton is sold primarily in the United States, United Kingdom, Japan, Canada, Australia, and Ireland.

Other product lines included under the WWRD Holdings umbrella include: Rosenthal, Coalport, Mason's, Johnson Bros., Franciscan, Thomas Rosenthal Group, Hutschenreuther, Minton, Royal Albert, Marquis, Stuart Crystal, Edinburgh Crystal, WC Designs, and Spring

. Rosenthal employs approximately 150 artists to manufacture their fine porcelain tableware and ornamental wares. Most of Rosenthal's products are sold in Central Europe. WC Designs is a manufacturer of luxury table and bedroom lines, as well as decorative accessories for the home. WC Designs brands include: Royal Palace, Waterford Linen, Wedgwood Linens, Wilton Court, and Susan and Sarah Collection. Lastly, Spring is a high-end manufacturer of serving ware, chafing dishes, and assorted cookware.

The company has not had a vision statement since its inception. However, the following is the recommended vision:

Waterford Wedgwood plc strives to design and manufacture the finest quality crystal, ceramics, and luxury lifestyle products to beautify the home and provide long lasting value to their customers around the globe. With the partnership of leading designers and celebrities and the highest commitment to customer service, Waterford Wedgwood stands apart from its competitors.

In addition, although there is a mission statement available, it is lacking many of the critical components necessary in an effective mission statement. As such, the following mission statement is recommended:

To continue to be the world's leading portfolio of luxury lifestyle products with particular emphasis on tabletop, gifting and the home, for global customers who appreciate the quality pieces to beautify their home. Manufacturing processes and technology are employed to ensure the highest levels of quality, to create high-end pieces that provide a lasting value. To this end, Waterford Wedgwood employees are the lifeblood of the organization and will be provided an environment in which they are motivated, informed and can work in a safe and healthy environment.

All in all, the company has achieved a remarkable level of success over the last two hundred years. However, like the missing vision and inadequate mission statement, there are components of the strategic puzzle that could be honed to fit better into the big picture. Waterford Wedgwood has developed strategies to address many of their opportunities and threats, specifically threats. Of particular importance is the companies lack of strategy change in response to the economic downturn not only the U.S. But the world itself know this. Weaknesses too seem to be lacking in strategic direction. As such, a strategy of developing a new product line, under the core brands umbrella, with a lower-priced protect it from many of the threats the company faces, while taking advantage of their strengths and opportunities and warding off their weaknesses.

Analysis:

Waterford Wedgwood has a long history of success; however, their strategic direction is not honed for the economic challenges of today's world. As a result, the company has experienced continuing revenue and profit decline. The company does not currently have a vision statement to inspire the organization as it moves forward through murky economic waters. Their mission statement is lacking in many important aspects. Their objectives are unaggressive and do not fully capitalize on the opportunities and strengths at their disposal. Lastly, their strategies are more focused on maintaining the status quo as opposed to growth, in a time when the previous status quo simply can no longer be profitable.

While evaluating the external factors affecting Waterford Wedgwood, it becomes clear that their strategies in this area are just about average. This moderate rating is negatively impacting their profitability and their growth. Although the company has implemented strategies to take advantage of the benefits of restructuring and continues to be a leader in new product development, there are still other areas where their strategies do not address these opportunities and threats. Partnerships with top designers and celebrities have boosted corporate sales; however, current strategies do not appear to be capitalizing on developing new partnerships to continue growth. Merging with complimentary companies too has proved successful, in the past, therefore it would seem logical that the company employ this strategy again. Yet, there are not plans to do so that have been released to the public. Brand repositioning, as a whole, simply would not work for the company, in that they entire company image and philosophy is centered on luxury goods; however, there may be a position for developing a new product line under an already established brand's umbrella.

Again, Waterford Wedgwood appears not to have taken the current economic turmoil into consideration when developing their strategies. Threats such as reduced availability of credit, reduced demand for luxury goods, and continued softness of the U.S. dollar are important to consider when formulating strategies. Yet, the company's 'business as usual' attitude seems to ignore these potentially devastating factors.

Internal factors, for the company, are taken more into account in their current strategies; however, there are still some of these factors that fail to make it into the organization's strategic planning.

After reviewing the variety of strategic analysis tools it is decided that one strategy Waterford Wedgwood should undertake is the development of a new product line, featuring lower prices. This one alternative takes advantage of many of the company's strengths, like their core business unit. It also wards off weaknesses and threats, including those caused by economic upheaval not only here in the United States, but around the globe as well. Although there are some potential risks to this strategy, such as poor acceptance by customers and low-priced products negatively affect other brand images as well, the benefits far outweigh the risks. Increased revenues, especially from a demographic that they may not have reached before, increased profitability and possible entry into new geographic markets all are reason why Waterford Wedgwood should adopt this strategy immediately.

Existing Vision, Mission, Objectives, and Strategies:

Waterford's first vision was to "create the finest quality crystal for drinking vessels and objects of beauty for the home."

Today, with the merger of the three companies, the mission statement is surprisingly similar. "To continue to be the world's leading portfolio of luxury lifestyle brands with particular emphasis on tabletop, gifting and the home."

Working with top designers including Versace, Vera Wang, and Marc Jacobs, Waterford Wedgwood has been able to transform a more than two hundred year old vision, to a guiding, multi-company mission statement that is still relevant today.

The organization's strategies to achieve the objective of being the world's leader in luxury lifestyle brands, has centered on the development of a portfolio of brands. This arsenal of high quality brands include: Waterford Crystal, Wedgwood, Royal Doulton, Rosenthal, Spring, and WC Designs. However it is the co-branding relationship that Waterford Wedgwood has developed that has really set it apart from other manufacturers of lifestyle products. Working with top designers and leading celebrities, Waterford Wedgwood has expanded their product lines to include a variety of well-known partners. These include: Emeril Lagasse, Versace, John Rocha, Terence Conran, Marc Jacobson, Jasper Conran, Zandra Rhodes, Vera Wang, Martha Stewart, Barbara Barry, Gordon Ramsay, Dr. Andrew Weil and the Andy Warhol Foundation.

Yet, these current strategies are being enacted in a time unlike anything else the company has ever experienced.

The economic challenges faced today… READ MORE

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Quoted Instructions for "Waterford Wedgwood" Assignment:

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CASE STUDY PROJECT DETAILS

This project will consist of the analysis of ONE Case Study chosen by the student from one of the Case Companies in the course textbook.

The company that I chose is Waterford Wedgwood PLC, Stock Symbol WATFF, and Headquarter in Dublin, Ireland at the time of this printing. It is my understanding that it was to be purchased by KPS Capital Partners, an investment group from the United States. Since the company is experiencing financial problems there should be a great deal of information about the company. Company Website is: www.waterfordwedgwood.com

The work submitted must be done using Microsoft Word

The student will do this assignment by following the guidelines below in completing the project.

Times New Roman, 12 Font, Double spaced, 12 Referenced sources

A. Executive Summary: This will be two to three pages, and do the following:

Summarize your analysis and its results including any recommended changes to the organization*****s vision/ mission, objectives, and the strategies that will result in the achievement of the long term objectives. This is where an overview of the details of the report is found. The details are found in section B, Analysis.

B. Analysis: this will be a detailed analysis that supports the conclusions and recommendations contained in the Executive Summary. Each item below, 1-10, must be submitted in a separate section for each, labeled as to the item. For example: "The firms' existing mission, objectives and strategies", EFE Matrix***** etc. For each of these items, there must be a brief summary [one to four paragraphs] included to explain the result achieved, such as a new mission statement, including the rationale behind that result. [Also as discussed above submit all of your work in one document, not as many different document attachments].

1. Discuss the firm's existing vision, mission, objectives and strategies. Cite sources.

2. Develop a new vision statement, and mission statement for the organization. [Or, provide a logical analysis as defense as to why either or both should not change].Base the analysis on the criteria found in the course text book. Use the "Mission Statement Components" (see below) to analyze the existing mission statement and to develop a new statement.

Mission Statement components:

Customers *****“ Who are the firm*****s customers?

Products or services *****“ What are the firm*****s major products or services?

Market *****“ Geographically, where does the firm compete?

Technology *****“ Is the firm technologically current?

Concern for survival, growth and profitability *****“ Is the firm committed to growth and financial soundness?

Philosophy *****“ What are the basic beliefs, values, aspirations, and ethical priorities of the firm?

Self-concept *****“ What is the firm*****s distinctive competence or major competitive advantage?

Concern for public image *****“ Is the firm responsive to social, community and environmental concerns?

Concern for employees *****“ Are employees a valuable asset of the firm?

Indicate how each of the nine components is met or not met. For the existing and the newly developed mission statement use an Evaluation Matrix as done in case Exercise 2A on page 66 to illustrate your analysis. The new mission statement MUST MEET the nine components.

(See supplemental submission for Exercise 2A page 66)

3. Construct an EFE Matrix. Identify at least seven of the organization's external opportunities and at least seven of its threats. The analysis of this item is to explain why the factors were chosen and how the weights, ratings and final score were derived. This should be based on the research about the company and the external environment in which they operate. Cite sources.

4. Construct a Competitive Profile Matrix. Identify at least seven critical success factors upon which your comparison of competitors is based. The analysis of this item is to explain why the factors were chosen and how the weights and ratings were derived. Explain the final scores for each company in terms of why one company, particularly your case study company, scored lower or higher than the competitors. This should be based on the research about the company and its primary competitors. Cite sources.

5. Construct an IFE Matrix. Identify at least seven of the organization's internal strengths and at least seven of its weaknesses. The analysis on this item is to explain why the factors were chosen and how the weights, ratings and final score were derived. This should be based on the research about the company and its internal strengths and weaknesses. Cite sources.

6. Develop Long Term Objectives that result from your analysis in items 1-5 above. Number each Objective. Explain how your an*****s of the items in 1-5 above relate to each of the objectives chosen. Compare your recommendations to the objectives planned by the company as identified in the textbook*****s case study write up or other sources such as Securities and Exchange Commission reports or the company*****s web site. Cite Sources.

7. Prepare a SWOT Matrix. Explain briefly why each of the strategies chosen in each of the four cells is considered feasible for future consideration in terms of how each supports the Long Term Objectives you have chosen. For the SWOT Matrix, you must include at least four strategies in each of the strategy cells-SO, ST, WO, and WT.

8. Prepare ONE QSPM Matrix. From the SWOT Matrix chose at least ONE SET of strategies to be evaluated. Each set of strategies being compared must fall in the same strategic category; for example- expansion in Europe versus expansion in Asia. These two alternatives fall into the Market Development category.

The following are the Alternative Strategies Defined and exemplified from textbook:

FORWARD INTEGRATION *****“ Gaining ownership or increased control over distributors or retailers.

BACKWARD INTEGRATION *****“ Seeking ownership or increased control of a firm*****s suppliers

HORIZONTAL INTEGRATION *****“ Seeking ownership or increase control over competitors

MARKET PENETRATION *****“ Seeking increased market share for present products or services in present markets through greater marketing efforts

MARKET DEVELOPMENT *****“ Introducing present products or services into new geographic area.

PRODUCT DEVELOPMENT *****“ Seeking increased sales by improving present products or services or developing new ones

RELATED DIVERSIFICATION - Adding new but related products or services

UNRELATED DIVERSIFICATION - Adding new, unrelated products or services

RETRENCHMENT *****“ Regrouping through cost and asset reduction to reverse declining sales and profits.

DIVESTITURE *****“ Selling a division or part of an organization.

LIQUIDATION *****“ Selling all of a company*****s assets, in parts, for their tangible worth.

They are competing options for implementing the same strategy-Market Development. If you cannot fit two or more strategies into the same category, then they cannot be included in the same QSPM. Explain how the two or more strategies you have in the QSPM fall into one of the strategic categories (listed above). Lastly, use the QSPM format on page 208 to do the matrix. In the QSPM identify which alternative strategies from the SWOT matrix are being compared. Identify them by the CELL-SO, WO, ST, WT- from which they are drawn. Explain the weights and attractiveness scores assigned so that it is clear why one alternative in the set was chosen over another. The strategy chosen must be based on the QSPM analysis.

(See supplemental submission for QSPM Format page 208)

In this report you are required to discuss a how the strategy chosen supports the achievement of one or more of the Long Term Objectives established in step 6. Ensure that you explain the results of the QSPM in terms of why the strategy chosen scored higher than other comparable ones.

9. Recommend procedures for strategy review and evaluation for the strategy chosen. Base your strategy review procedures on one or several of the tools found in chapter 9: Table 9-1, Table 9-3, Table 9-4 and or Figure 9-2. Explain specifically for the strategy chosen how the chosen strategy review procedure would be applied.

(See supplemental submission for tables and figure)

10. Identify and explain one contingency plan for the strategy recommended. Use the seven-step process outlined below in developing the contingency plan.

1. Identify both beneficial and unfavorable events that could possibly derail the stratÂ¬egy or strategies.

2. Specify trigger points. Calculate about when contingent events are likely to occur. Assess the impact of each contingent event. Estimate the potential benefit or harm of each contingent event.

3. Develop contingency plans. Be sure that contingency plans are compatible with current strategy and are economically feasible.

4. Assess the counter impact of each contingency plan. That is, estimate how much each contingency plan will capitalize on or cancel out its associated contingent event. Doing this will quantify the potential value of each contingency plan.

5. Determine early warning signals for key contingent events. Monitor the early warning signals.

6. For contingent events with reliable early warning signals, develop advance action plans to take advantage of the available lead time.

C. References: In researching the case study reference material used must be properly credited. The American Psychological Association [APA] format style will be used for documenting sources. [The typing will be double spaced, Font 12, Times New Roman]. This includes an APA List of References, and each time a portion of an author[s] work, a direct quote or summary, is used in the body of the report, an in-text citation in the American Psychological Association [APA] format is to be used. See resources about APA Style under Doc Sharing. Make sure that you give full credit to the work of others. This includes material taken from the course text book by ***** and or the case studies written by other authors.

Doing this improperly can affect your grade. In the worst case, can result in an F for the paper.

NOTE: the web site WIKIPEDIA is not a valid site to use for this paper. Using it as a cited source in the report will result in a loss of points. Each time this site is used in the paper {-10} points will be deducted from the grade for the paper.

In addition to the Textbook, you should use at least 12 other sources to ensure that you have done a complete review of an organization and its competitors.

D. Grading of the Case Analysis Paper: The paper will be graded on grammar and spelling and how well the paper presents a logical analysis that supports reasonable recommendations that are being made. You will use the text book as well as other sources for the research. IMPORTANT: you will have to use sources [see C above] other than the text to ensure that the information is up-to-date. The case an*****s in the text book were done in 2007-2008.

(See supplemental submission for Case analysis of Waterford Wedgwood from textbook)

Also ensure, as discussed under item C above, that you are careful in citing data and information taken from OTHER sources. You will lose points if you do not give proper credit through FOOTNOTES. You must meet all of the requirements as outlined above in order to receive the maximum credit possible.

It is requested that you read pages 320-331 for information that will be helpful to you in doing this project.

(See supplemental submission for textbook copy of pages 320-331)

Also, in the "Doc Sharing" portion of the course web site, there are some samples of Case Analysis Project work done by students for this assignment. Since these come from the work of different students this does not represent a complete project but is only meant to assist in understanding the level of analysis required.

(See supplemental submission for sample Case Analysis Project)

*****

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