Edita’s Opertionalization Strategy

Introduction

The following research discuss the company`s operations strategy, tools, skills, and frameworks they use, the

enablers and challenges that determine whether or not to proceed with a project.

This critical analysis is done in Edita.

Edita:Founded in 1996, Edita Food Industries is a pioneer in the Egyptian and regional snack market, including

cakes, rusks, waffles, sweets and biscuits. The names are Molto, HoHos, Twinkies, Tiger Trail, ToDo, Freska,

Bake Rolz, Bake Stix, MiMix and Oniro across all its 32 product lines at five ISO manufacturing facilities in

Egypt and Morocco, Sales reached 7.7 billion Egyptian pounds, a record high Profits doubled year-on-year to

reach EGP 959.4 million in 2022.

Edita has applied four key strategic pillars:

Innovation and differentiation: The research & innovation capabilities, Portfolio optimization, and Repricing

strategy.

Regional Expansion: Edita Morocco, Growing our exporting footprint.

Diversity revenue stream: Growing our portfolio, Growing across the region, Growing in Adjacent Segments.

Leverage Human Capital: This includes Training and Development, Employee engagement, Diversity and

inclusion.
 Operationalization of strategy

Strategy means the steps taken to achieve an organization's vision and long-term goals.

Operational strategy: It connects an organization's vision, mission and its implementation through interactions

between resources created to meet design briefs while achieving customer satisfaction and transforming into

products.

The operations strategy is applied on 03 levels of Strategy:

- Corporate strategy: the variation in how a company`s resources are deployed throughout its portfolio of

industries, (Bread et al, 1981).

- Business strategy: the variations in company characteristics those are relevant to competitive success or

failure within a certain industry, (Bread et al, 1981).

The functional strategy: decisions and plans for specific firm activities and functions that help to attain higher-

level strategic goals, (Connor, T.2001).

Tools and frameworks to evaluate the business strategy:

1- PESTEL Analysis: Six factors are used to evaluate the external environment.

- Political factors: How the company will adapt when the government change the law, ( Kardes, 2021).

- Economic Factors: such as rates volatility, Interest Rate.

- Social Factors: such as education, religion, ethics, way of living and demography.

- Technological Factors: such as e-commerce and patents.

- Environmental Factors: to be an environment friend is an asset to the company.

- Legal Factors: business which is abiding by the law will keep way from market attacks (Sanders, 2011).

2- SWOT framework:

As per (Helms, M.,2010), It is a tool for treating the strategic complexity, by reducing number of information

to improve the decision -making by analyzing four internal and external factors:

Strength- Weakness- Opportunities –Threats

It analyzes the five competitive strengths of each industry, identifies industry weaknesses and strengths, and

competitors within the industry, helping companies improve their long-term profitability.

- Number of Competitors within the industry: The more competitors offer the same number of comparable

products and services, the less power a company has.

- Possibility of new industry competitors: The power of a company also depends on the power of new

competitors. Industries with high hindrance to entry will survive in the market, as companies can set higher

prices and negotiate better terms.

- Supplier Power: The more suppliers a company have, the lower the cost of its products and the less

profitable.

- Customer Power: A company's profit is determined by the number of customers.

- Alternative threats: Business threats can limit the scope of our products and services. .

Tools:

Porters Value Chain model:

Businesses carry out primary and support activities ranging from resources to product appearance,

Ruan (2020).

Tool of VRIO Model:

Resource-based view theory (RBV), concentrates on the superior financial performance to resources and skills

that are firm-specific, rare, and difficult to imitate or substitute, and have an organizational orientation,

(Chino et al, 2012).

VRIO is the tool will help applying RBV, with answering four questions, Chris (2006):

- Value: is the resource valuable to use, as a result will increase revenue?

- Rarity: Are the competitors possess it?

- Imitability: Can the competitor imitate this move easily?

Role of Resources and Capabilities on the business strategy:

Kind of Resources:

- Physical resources: Raw materials, machinery…

- Non-physical resources: brand.

- Employees.

To achieve work and execute the business strategy, it is important to have to have skilled employees and

technology processes (Akaegdu, et al 2017).

Performance Management:

“Performance measurement refers to the act of identifying, collecting, and. reporting measures, which are used

solely as a communication tool for demonstrating effectiveness to external stakeholders" (Much, J.2011).

As per Bahatti (2013), this appraisal has to be done through some measures called Key performance indicators

(KPI) and they differs from company to another, KPI may include quality, cost, finance delivery, customer

satisfaction, employee satisfaction, delivery reliability, safety, flexibility…etc.

- Investment appraisal:

Investment is any asset the company own and expected to bring future profit.

The tool answers the question of whether shareholders should continue to invest in this company, explaining

that the current cash value is higher than future cash received and is dependent on interest rates over the life of

the investment.
- Investment evaluation types:

- Pay back: When the original investment funds are returned to the shareholders.

- Net Present Value: Are the revenues higher than your costs?

- Internal rate of return: Are revenues higher than alternatives?

- Budget and Operational Budget:

Budgets are used in firms for various purposes (resources allocation, individual activities coordination) and are

connected with measurable performance, Popesko et al (2017), Determine expenses and revenues for a period

in the future must be reviewed and re-evaluated periodically, through operational budget system, (Salman,

2023).

Corporate Governance & Procurement Governance:

Corporate Governance: The specific guidelines used by stakeholder representatives to monitor goal fulfillment

avoiding the risk in order to be consistently present and effective in the marketplace.

Corporate Governance importance to the company:

- Establishing regulations and policies to govern the management and shareholders to improve the economical

efficiency and performance of the company

- Establishing an organizational structure for the determination of objects and their implementation.

- This enables the participation and funding of the organization in foreign markets.

Corporate Governance importance for shareholders:

- This ensures that shareholders participate in voting and decision-making on all material changes that affect

the achievement.

- Investment decisions rely on providing financial and operational compliance data to determine what business

risks exist.
Procurement: is managing and providing all kind of materials, machines, utilities and workforce, and

consulting services, the foundation of procurement is having formal procurement strategy integrated with good

planning and corporate strategies.

Procurement Governance: explains the product supply base cost structure and provide the guidance on the

probability to achieve the target and provide the proactive input about price changing in raw materials, helping

decision makers to proceed with their strategy, (Millington, 2020).

Balanced Scorecard:

A strategic planning system that informs management about the four factors used to measure long-term

performance (Sharif, 2002).

Employees: Are they competent enough to implement organizational strategy using all available methods?

Internal process: Managers who perform their duties to achieve the company's vision and goals.

Customers: What are their needs and how can they be met?

Finances: What data do you need to have available to act risk-free in the market?

Role of Workforce diversity in fulfilling the marketing strategy.

Diversity in workforce enable the company for dealing with all types of local customers face to face, knowing

the customer’s traditions, and norm for example will ease the company mission to reach the stakeholders in

national market and will effectively succeed to represent all products in the market between its competitors,

also sharing skills, method of fulfilling the instructions and improving the requested process to achieve the

marketing strategy.

This diversity helps decision makers, especially when launching new projects, offering the experience and new

techniques to make this new project a success, (Rosenzweig, 1998).

Was known as the four Ps, which were first introduced by Borden in 1953 and later refined by McCarthy in

1960.

- Product: The item or service that the company will distribute to the customer.

- Place: Refers to the availability of products that customers find through sales channels.

- Promotion: Activities that enable products to communicate with customers through advertising and

personal selling.

- Price: the amount of money should the buyer pay to the product, by several pricing strategies.

Challenges of marketing service: Intangibility, Lack of ownership, Perishability, Inseparability, Heterogeneity,

Customer involvement have appeared, as a result, in 1980 Booms and Bitner added 3Ps:

- Participants: They are the key to influence the customer to buy the product.

- Physical evidence: the visible surroundings that facilitate the performance, communications which can

affect the customer impressions about service quality.

- Process: Set of actions and functions that increases the product value with low cost and high advantage in the

market.

Service Quality: one of the definitions as per Kannan et al (2012) is how skilled personnel execute a service for

the customer who chose to use the company’s products. (Syapsan 2019).

The SERVQUAL model of Service contains five dimensions (Rahman, 2017).

Reliability: is the success of the company to meet the customer expectations and satisfaction.

Tangibility: All company’s tangible quality, such as employment appearance and company offices.

Empathy: Is the company care about the customer welfare?

Responsibility: the time that the company response of the customer communication

Certainty: customer service department should gain the customer’s trust.

of competitors in this segment (Cahill, 1997).

Segmentation dimensions:

Geographic: where are the targeted customers living?

Demographic: Dividing the customers by their characteristic.

Behavioral: dividing the customer by the product feedback.

Psychographic: the values and beliefs of the customers that affect the sustainability of the product.

Positioning: is the competence of how attracting customer to the product brand in spite of the existence of

other brands.

Brand positioning strategies:

Product Benefit position: What is the advantage of this product in the market.

Surrogates Position: Customer feeling and customer opinion.

Manager Oriented Perspective: Managers should focus on competitive environment.

Customer oriented Perspective: Focus on competitiveness between firms producing the same

product for the same customer.

- Edita has successfully executed its marketing strategy at strategic and operational levels, targeting many

markets starting from Egypt, Morocco, and expanding exports to more than 20 countries and products in six

segments. As a goal, the 4Ps/7Ps was clearly revealed in the survey. The Market, Research and Innovation

departments have done their best to maintain current products and develop new products that are competitive

in the market.

- Edita successfully implemented the following corporate strategies:

This investment started with his one project and grew to his five factories in Egypt and Morocco.

Operational budgeting was done well as numbers translated into measures. The procurement department has

faced difficulties especially in 2022 with flotation and inflationary pressures. The quality control department

ensures that all inspections performed comply with the highest food safety standards, and keen on customer

satisfaction and approval.

- Passionate about using new technical equipment in production.

- Edita has achieved employee engagement through communications in HR and successfully delivered

advanced training through the academy, internal and external training centers, and classroom interventions.

The company also has a successful and diverse workforce and has many principles of inclusion, acceptance,

and even a zero-tolerance policy in case of misconduct.

- From the above considerations, the PESTLE framework for business strategy was performed.
Conclusion:

As explained above, a well-designed and executed strategy on three levels is the reason for successful

establishment and persistence in a competitive marketplace.

Planning, investment, budget, and operational strategy (including performance management, quality control,

technology role), marketing strategy, well-trained and satisfied employees, and the key role of procurement, all

help companies achieve their goals and reach the optimal level for product realization.

- Recommendations:

In the waffles, rusks, candies and biscuits segments, researchers need to be done to increase sales and revenue.
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- https:// https://ir.edita.com.eg/