Dominos Pizza: A Crisis Management Case

Dominos Pizza A Crisis Management crimsontJosefina VasquezAccording to (PRSA, 2009), in 2009, the connection Dominos pizza experienced a tremendous PR crisis because of a couple of their employees. In f exemplify, in a restaurants kitchen, in a slow working day, the two of them, with the employee uniforms, contaminated both(prenominal) food ingredients and thusly placed them onto sandwiches and pizza they recorded a video and later affix it on YouTube. This video reached to a greater extent than wiz million views in erect terzetto days because it became viral. The fellowship realized that affectionate media has the spring to magic spell sm only incidents into huge food marketing crises.This is a real case re bothy interesting to analyze from the point of view of public dealing and ethics. Because something simplex could be the cause of the failure or success of significant companies, and what would micturate the difference argon the decisions taken in crises. In thi s review, we will be looking at this case from the point of view of the public relations master and the ethical degrees and how this addresses companies direction.Dominos Pizza A Crisis Management CaseAccording to (PRSA, 2009), the vice president, the converse team and the rest of Dominos corporeal members sooner became a contende of this situation. The first reaction was anger, but they channe direct into action. The bon ton proceeded to stop the store, the authors of the video, took away the videos, and the comp any takeed charges against them. One of the first actions was to find proscribed if the contaminated food was fin wholey delivered to a client, fortunately, it was non. Domino has had the plan to present the high society to Facebook, Twitter and some other social media sites by 2009 comely before the crisis, but they did it during the crisis in order to communicate with the active mall audience. The CEO decided to the response by YouTube instead of distribut ing a press release because even at a million views, they thought in that respect were 307 million people in America, so they focused on that audience. They veritable criticism from the media during the first twenty-four hours, because people thought that they were not doing anything to the highest degree it. The company understood that the most important thing was to de aim the companys credibleness with nodes. Dominos pizza learned that is so important to keep in exigency with media web community all times. (Randallreilly.com, 2015) stated that the company listened to their audience and later they admitted that their product was awful, so that, they started a campaign called Pizza Turnaround, in order to acknowledge the problems they were facing and reinvent their pizza, this along with an extensive media c overage, documentaries, promotions, advertising, etc.Problem Statement.The companys PR team faced an important challenge. The company had a disadvantageous place due t o the lack of presence on social networks. Dominos faced the dilemma of obviating persons opinion by denying, and plainly focus on defending their brand or putting on the customers side and reinforcing their product. This crisis could have undermined this larger multinational company, so they had to deal with some ethical principles such as fairness, honesty, expertise and loyalty.Personal Critique of the Case.In this context, is important to point out the involution management life roulette wheel concept from (Wilcox, Cameron and Reber, n.d.) which has a proactive, strategic, reactive and reco precise phases, and the way the companys PR professional applied it during this situation. The proactive phase involves crisis-planning, issues tracking by creating outline plans in ship canal that address the emerging issue. The strategic phase allows organizations to place itself favourably in anticipation of actions. The reactive phase occurs when the issue or conflict reaches a cri tical level of impact it involves the implementation of crisis management plan, crisis intercourse and conflict re issue. The recovery phase involves reputation management and image restoration.PR professionals at Dominos pizza implemented both the reactive and recovery phases as well, once the issue became critical. They initiated a crisis management plan by establishing communication channels with the target audience by dint of social media. They ex mixtureablewise implemented reputation management and image restoration when they decided to reinvent their pizza with a campaign called Pizza Turnaround by development an extensive media coverage, documentaries, promotions, advertising, etc. Once the crisis was overcome, they started implementing the proactive and strategic phases of establishing constant communication with customers through social media channels, with a strategy to pay special precaution to customer feedback.ReferencesWilcox, D., Cameron, G. and Reber, B. (n.d. ). Public relations.PRSA. (2009). Dominos Delivers During Crisis The Companys Step-by-Step Response After a Vulgar Video Goes Viral. online Available at http//apps.prsa.org/Intelligence/TheStrategist/Articles/view/8226/102/Domino_s_Delivers_During_Crisis_The_Company_s_Step.WNMO7PkrLIV Accessed 23 Mar. 2017.Randallreilly.com. (2015). Dominos Pizza A Case Study in node Feedback Randall-Reilly. online Available at http//www.randallreilly.com/dominos-pizza-a-case-study-in-customer-feedback/ Accessed 23 Mar. 2017.Tesco and Sainsburys A relation of StrategiesTesco and Sainsburys A Comparison of Strategies1. Introduction craft strategies are largely unique to individual condescension organisations and depend upon the objectives of their primary stakeholders, namely the shareholders and the senior management. piece these two entities are the main decision strivers for the road maps followed by firms, which they exercise through planning and articulation of objectives, mission stateme nts, and strategies, many other issues akin product or service features, strengths and weaknesses of avocation organisations, economic, effectual and political environments, nature and intensity of competition, opportunities and threats, environmental and ecological need, as well as technological advances, often influence major roles in determining and implementing assembly line strategy. Work in these areas, by management experts, have led to the development and construction of models and theories that attempt to elaborate, let kill and demystify these issues. The tackling of these challenges previously depended upon the thought processes and ingenuity of business owners, and played alert roles in the successes or failures of business organisations. The work of Igor Ansoff and Michael Porter led to the enunciation of well known strategic models for harvesting and the Five Forces theory for digest of competitiveness. These tools, as well as decision making aids same SW OT and PESTLE analyses have create commonplace in todays business scenario, and are widely used by managers all over the world. composition most growth strategies deal with marketing, other areas akin production, human resource, information technology and finance also need end setting, and are important to overall strategy for optimisation of organisational wealth. Total note Management, for example has emerged in recent years as a necessary item in every strategic managers tool chest for achievement of organisational objectives. isolated from these tools, business strategies for growth and shareholder wealth gustation are also influenced by the ethics and value systems of individual corporations mend many firms chose to forsake both growth and profitability for ethics, the reverse, as evinced by scams like Enron and WorldCom is equally true.Every so often, companies in the same industry, and operate in the same national or global environment, adopt crisply different st rategies with spectacularly divergent results. Search engines like Yahoo and Alta prospect existed for years before Google arrived on the scene and swept everything before it. Toyota, a Japanese car manufacturer, formed ofttimes afterward the end of the guerrilla World War, entered the car market of the United States in the face of general scepticism, and over a few decades, orchestrated a business strategy that saw it overtake Ford, the iconic American car making giant. Among British companies, the last two decades saw the rise and rise of the sell company, Tesco. The company changed its grim market pile them high, sell them cheap public acquaintance to emerge as the largest retailer in the country, first overtaking the some(prenominal) older market leader Sainsburys and so proceeding to branch out the open frame until its market share was twice that of its erstwhile condescending rival. This subsidisation aims to examine and analyse the different strategies adopted by these companies, which have corresponding products and services, and also operate in the same environment.2. Commentary and AnalysisBusiness organisations constantly face challenges in every sphere of activity, be they in marketing, sales, production, workforce, human resource management, information technology development, or in raising and controlling finances. Many of these challenges arise from the social, political and economical environments in which organisations operate. While businesses in the UK operate in democratic and market friendly environments with institutionalized legal and financial systems, they need to conform to the stipulations laid down by numerous regulatory bodies (of the UK and the EU) and governmental organisations, and that too in almost all operating areas. Further to a greater extent(prenominal), firms with global operations have to frequently function in conformity with different environmental requirements, necessitated by dissimilar political and legal systems, or by widely divergent local, infrastructural or market conditions. Sainsburys and Tescos both entered the UK retail market, as small gismo stores, not much different from the many such establishments that exist all over the UK. Both organisations outgrew and outperformed other businesses in their genre to bring colossal retailing cooking stoves with countrywide presences. Sainsburys, a much older firm than Tescos was the market leader in the UK retailing sector, until 1995, when it was overtaken by Tescos.a. SainsburysJ Sainsbury, plc, is one of Britains most famous firms, represented across the country, through its mountain range of supermarket stores that operate under the Sainsburys brand. Apart from supermarkets, the company operates convenience stores, an internet-based home delivery betrayping service, and Sainsburys Bank. The company, originally started as a partnership in 1869, and while incorporated as a nonpublic company as far back as 1922, listed o n the capital of the United Kingdom Stock Exchange only in 1973, in what was until then the LSEs largest furrow issue. Sainsburys grew to become the UKs largest supermarket company and retained its interior position for much of the twentieth century. Tescos overtook Sainsburys in 1995, and ASDA/ Wal-Mart relegated it to trine position in 2003. (J Sainsbury, 2007)While the business, in the beginning, grew organically into a chain of convenience stores, its first major strategic decision came, in 1950, with the inauguration of the first self service store, in Croyden, London. This initiative was followed by change magnitude the subjugate of self service stores, expanding the range of non food goods, opening of hyper markets, encyclopaedism of smaller chains, and commencement of operations in Scotland and North Ireland. The company grew to become the countrys largest supermarket chain, fuelled by increasing economic affluence, changing get habits, customer convenience, and th e ability of Sainsburys to provide a large and assorted range of products under one roof. Large Sainsburys stores typically stock 50,000 products, of which 50% are home brands. While the company grew slowly in its initial years, real growth came only in the stick out war years, with the development of a strong market economy, economic prosperity, increased pass power, and customer desire for a large range of better whole step goods. Sainsburys responded to this changed economic environment, by concentrating on the increasing and upwardly supple middle class. The company refrained from taking too many risks or initiatives, by chance feeling that its reputation would enable it to grow steadily and retain market leadership. The strategy of least resistance was interspersed by a few initiatives like the introduction of Do it Yourself (DIY) products, and acquisition of chains like Bells Stores, Jacksons Stores, and JB Beaumont, which served to add to and broaden its customer base. The company has more than 750 stores today, and with a swage in the range of 16 billion GBP, is one of UKs more successful corporates. A prima facie assessment regarding the companys response to business and environmental challenges would tend to give credit to the companys corporate strategies in an extremely competitive business environment.This assessment would however be substantially incorrect. Even as the company continued to grow steadily, in both profits and sales, through the nineties and into the 21st century (except for the difficult years of 2004 and 2005), it was overtaken, first by Tescos in 1995, and later by ASDA in 2003. Tescos , which had a turnover of less than 11 billion GBP in 1994 saw its sales touch 38 billion GBP in 2006 and now sells more than twice of what Sainsburys does. Very apparently, Sainsburys has committed serious errors in handling and responding to business and environmental challenges, and has yielded the high ground in supermarket retailing t o younger and whitethornbe more effective competition.b. Tescos Growth PathTescos started off as a small one man grocery operation, in 1919, in Londons East End. It took Jack Cohen, the founder, 10 more years to start his first store, in 1929, a full 60 years after Sainsburys. The company grew organically in the initial years, spurred by Cohens hard work. In the beginning business strategy go around around providing cheap and economical goods, (pile them high, sell them cheap) espousal of trading stamps to bring forth customers, and relentless opening of sassy stores. Strategies, broadly similar to those followed by Sainsburys in the post war years led Cohen to open Tescos first self service store in 1947, and the first supermarket in 1956. In retrospect, Cohens better understanding of the demands and changing moods of customers is possibly evinced by his decision to open his self service store, a full three years earlier than Sainsburys.When Cohen resigned, in 1977, the company had achieved significant growth and hairgrip but was still much behind Sainsburys, both in sizing and reputation. The years that followed Cohens handing over of Tescos leadership were marked by strategic swings designed to take the company away from its image of a purveyor of cheap and low quality goods. This period saw the management discharge an aggressive campaign for market share, a multi dimensional effort that twisty (a) rapid expanding upon of stores, (b) acquisition of medium sized supermarket chains, (c) entry and desegregation in a number of foreign markets, (d) large scale expansion of non food products, (e) opening of a number of hypermarkets, (f) introduction of loyalty cards, and (g) ontogenesis of online markets. The company assessed the real national and global environment and felt that it would be able to work towards significant increases in sales and profitability and make it into a global leader from its status of a lowly down market UK based retailer. The se strategies, combined with effective systems and operational implementation, enabled Tescos to power past Sainsburys, the British market leader, and establish itself as the third largest retailer in Europe. With sales of 38 billion GBP and 2 billion GBP in profits, Tesco is today the undisputed market leader, way ahead of both Sainsburys and ASDA. It played for glory and won hands down. (Pringle and Cohen, 2007)c. Management of Environmental ConditionsIn the early 1960s, Cohen lobbied Parliament to have the Retail Price Maintenance (RPM) act abolished, efforts supported by Edward Heath. The RPM allowed manufacturers and suppliers to set the price of goods thus preventing large retailers, who could buy in bulk and had greater buying power, from benefiting from economies of scale and undercutting the prices of smaller shops. To get around this, Tesco offered another incentive to get customers through the doors yard Shield Stamps. These were collected by customers when they spent m oney in the store, and were then traded for goods in a catalogue. An effective discount (Tesco, a corporate profile, 2004)This option serves to illustrate Tescos response to environmental challenges and the many innovative ways the company found to constantly improve customer value. The emergence of Thatcherism, in the 80s, coupled with the break up of the Soviet Union, the consolidation of a unipolar world, sharp improvements in internet technology, and the commencement of globalisation, created a number of opportunities that Tesco was right away to spot, grab, and exploit. The company closed down 500 stores, revamped and modernised hundreds of others. Store formats like Tesco, Tesco Express, Tesco Metro, and One Stop, catered to distinct sizes, products, and locations, and ranged from small street corner shops to huge all inclusive supermarkets. The company was quick to realise that its image as a purveyor of cheap products, with its perceived down market connotations, would not help growth in a society that was rapidly becoming richer, and did not flitter to close down its coupon device. In a brilliant segmentation exercise, the company created three product categories, good, better, and best, across most of its product lines. While this enabled customers to access different price ranges, it also allowed the company to access an inclusive and huge market. Sainsburys, which had traditionally catered to the middle class clientele with zealously defend margins, tried to enlarge its product base, but was unable to make any headway, because of its lesser supplier base and inferior logistical capability. (Pringle and Gordon, 2007)Tescos introduced customer loyalty cards in 1995. While it took Sainsbury some time to stick up with the idea, the two companies used it for widely divergent aims. Even as Sainsburys used the cards primarily to drive repeat visits and purchases, Tescos processed the information feedback from the loyalty card customers, to assess c ustomer demands and needs, and keep on adding to its product range. The company also foresaw the potential of the internet and globalisation, and establish profitable online sales channels, as well as successful foreign forays. Tescos international business now accounts for nearly 25% of company sales, and the immediate priority is to drive it up to 50% of company revenue. Apart from maintaining strong market leadership, Tesco is now focussing on two major areas that are propelling the companys growth and increasing the gap between the company and its competitors. Its aggressive growth in the non-foods market inwardness that it is possibly selling more clothes than Next and more wellness and beauty products than all the others put together. (Hunter, 2006) The company has set up base in numerous countries in Europe and Asia and should soon have a significant presence in the USA. Indeed, some 60% of Tescos floor space is now based outside of the UK. (Hunter, 2006) Sainsburys, on th e other hand has been too busy handling its inadequate stocking mechanism, half empty shelves, and travel market share, to be able to pay much attention to new thrust areas, and opportunities, made available by changes in environmental conditions and advances in technology. (Tesco, a corporate profile, 2004)3. ConclusionWhile this analysis does not nail down to eulogise Tescos management practices, or its planned and meticulous ontogeny of available opportunities, the stark difference in the working of Tescos and Sainsburys tend to make any comparative analysis of strategy, and management practice, tremendously one sided. Even as Tesco was using feedback from its loyalty card scheme to add enormously to its product range, Sainsburys was trying to adamantly entertain its margins and cutting down on service quality, practices that inevitably led to go on customer dissatisfaction and loss of market share. It was not until 2004, a full 9 years after Tesco overtook it, that the com pany realised that its major problem lay in under stocked shelves, inadequate logistics and poor supply chain management. While Sainsburys strategy appeared to be one of risk scheme and slow growth, in reality it proved to be akin to that of an ostrich in the face of danger. The company however still remains a respected and successful retailer. Recent initiatives, taken after a change in top management, have seen a priority shift and led to revived sales, reduced costs and improved profitability. The company has its heart in the right place and contributes a much higher percentage of its post tax profit to charity than Tesco.The tremendous success of Tesco, in assessing customer needs and environmental opportunities, came about because of a new aggression that evinced itself after the departure of jack Cohen and is an indicator of the possibilities that exist for Sainsbury. The fact that Tesco lagged behind Sainsburys until 1995 is proof of the levels to which Sainsbury can aspire without being impractically optimistic. Sainsburys has a number of strengths, namely its goodwill in the UK market, access to enormous amount of shop space and property that have been built up over the years, very strong domain knowledge in the retailing business, and adequate capital resources. The company has also become active in the online segment, the fastest suppuration market segment in the retailing market. It however definitely needs to scan the environment constantly, look for new opportunities, upgrade technology, and be more fleet footed in responding to opportunities and challenges.Both the companies have seen rapid departures from existing strategies after changes in top level management. Strange as it may appear, changes in management appear to have been critical to Tesco seeing opportunities that were not explored earlier. Sainsburys too has commenced implementation of measures that should have logically been done much earlier, only after a change of guard at the to p. The solution to the paradox possibly lies in realising that management theories, practices and strategies, in most cases, become relevant only if the CEO thinks them fit. The boss is the key.BibliographyAnnual report and financial Statements, 2006, J Sainsbury plc, Retrieved April 3, 2007 from www.j-sainsbury.co.uk/ar06/fullfinancials/notestofinancialstatements5.shtmlAnnual Review and Summary Financial Statements, 2006, J Sainsbury plc, Retrieved April 3, 2007 from www.j-sainsbury.co.uk/ar06/summaryfinancialsCavazza, M, 2007, Sainsburys volunteer is very close, thisismoney.co.uk., Retrieved April 3, 2007 from www.thisismoney.co.uk/investing-and-markets/article.html?in_article_id=418580in_page_id=3Cole, R, 2007, Sainsburys progress offers reason to hold even if no bid comes, Times Online, Retrieved April 3, 2007 from business.timesonline.co.uk/tol/business/industry_sectors/retailingHunter, H, 2006, Revolution in the British aisles why Tesco will continue to rule the roost, msn.m oney, Retrieved April 3, 2007 from money.uk.msn.com/Investing/ shrewdness/Special_Features/Markets_Comment/article.aspx?cp-documentid=1054991J Sainsbury, 2007, Wikipedia, Retrieved April 3, 2007 from en.wikipedia.org/wiki/J_SainsburyJordan, D, 2007, Tchenguiz adds to Sainsbury stake, Times Online, Retrieved April 3, 2007 from business.timesonline.co.uk/tol/business/industry_sectors/retailing/article1578864.ece 2 Apr 2007Pringle, H, and Gordon, W, 2007, The Tesco Story, customerserviceworld.com., Retrieved May 27, 2007 from www.ecustomerserviceworld.com/earticlesstore_articles.asp? persona=articleidTesco, 2007, Retrieved May 25, 2007 from www.tescocorporate.com/page.aspx?pointerid=A8E0E60508F94A8DBA909E2ABB5F2CC7Tesco,A corporate profile, 2004, Corporate watch, Retrieved May 27, 2007 from www.corporatewatch.org.uk/?bid=28