SOLUTION MANUAL
Strategic Management: A Competitive Advantage, Concept and Cases, 18th edition
by Fred R David | Forest R. David
SC
O
R
EG
U
ID
ES
, Table of Content
PART 1: OVERVIEW OF STRATEGIC MANAGEMENT
The Nature of Strategic Management
The Cohesion Case: McDonald’s Corporation
PART 2: STRATEGY FORMULATION
Business Vision and Mission
SC
The External Assessment
The Internal Assessment
Strategies in Action
O
Strategy Analysis and Choice
PART 3: STRATEGY IMPLEMENTATION
R
Implementing Strategies: Management and Marketing Issues
Implementing Strategies: Finance and Accounting Issues
EG
PART 4: STRATEGY EVALUATION AND GOVERNANCE
Strategy Evaluation and Governance
PART 5: KEY STRATEGIC MANAGEMENT TOPICS
U
Business Ethics, Environmental Sustainability, and Corporate Social Responsibility
Global and International Issues
ID
PART 6: STRATEGIC MANAGEMENT CASE ANALYSIS
ES
, Forest R. David
A. Case Abstract
Headquartered in Canton, Massachusetts, Dunkin’ Brands (Dunkin’) sells hot and cold coffee and
baked goods, as well as hard-serve ice cream, using a near-100 percent franchised business model.
With 11,000 Dunkin’ Donuts restaurants in 40 states and 32 foreign countries, and 7,300 Baskin -
SC
Robbins restaurants in 43 states and 46 foreign countries, Dunkin’ is one of the world’s largest
franchisors of quick-service restaurants (QSR). All but 36 Dunkin’ Donuts and Baskin-Robbins are
franchisee-owned. In the last few years, more and more customers are coming into Dunkin’
restaurants and spending more and more money when they are there. About 70 percent of all Dunkin’
stores have a drive thru, which caters to consumers in a hurry. Dunkin’ is a speed leader among QSR,
even given increased ticket volume and menu complexity.
O
B. Vision Statement (actual)
R
To be recognized as a company that responsibly serves our guests, franchisees, employees,
communities, business partners, and the interests of our planet.
EG
(Proposed)
Our vision is to be recognized as having the most responsible brands with unbeatable quality,
affordability, and convenience in baked goods, coffee and ice cream specialty products.
C. Mission Statement (proposed)
U
Dunkin’ Brands aspires to be the leading company in the coffee, donut, and ice cream industries (3) by
providing baked goods, coffee, and ice cream specialty products (2) to busy consumers (1) worldwide.
ID
We pride ourselves on offering superior quality, service, and convenience. (7) We are committed to
responsibly serving (6) our customers, franchisees, employees (9), and communities, while focusing on
a sustainable and green future. (8) We seek to be the leading quick service restaurant in our industries
by keeping up with the latest technologies (4) and insight to grow sales (5).
ES
1. Customers
2. Products or services
3. Markets
4. Technology
5. Concern for survival, growth, and profitability
6. Philosophy
7. Self-concept
8. Concern for public image
9. Concern for employees
1
, D. External Audit
Opportunities
1. There is a growing demand for catering services or home and office delivery.
2. Consumers are searching for healthier foods: IBIS expects the healthy eating index to rise 2.6%
from 2015-2019.
SC
3. Increasing demand for products to be sold in retail stores: 29% of coffee drinkers said they use a
single-cup brewer to get their daily caffeine fix.
4. Breakfast sandwiches are the new burgers; breakfast sales at fast-food chains increased by 4.8%
annually from 2007-2012.
5. Gluten free allergies are becoming more prominent in the US. About 20 million Americans have
celiac disease and 30-50% of the population have gluten sensitivity.
6. Although the price of coffee has increased, the consumption will continue to slowly increase at an
annualized rate of 1.3% in the next five years.
O
7. Lactose intolerant products are a major worldwide need. Two-thirds of the world's adult
population have trouble digesting milk.
8. Due to the health benefits of tea, consumption is projected to rise at an annualized rate of 1.0%
over the next five years.
R
9. Low interest rates to refinance outstanding debt or expand.
10. Disposable income in the US will grow at a rate of 2.5% over the next five years.
Threats
EG
1. Price of coffee is projected to increase by 1.5% each year for the next five years.
2. Starbucks is going to be offering home and office delivery in select markets in late 2015 through
Postmates.
3. Consumers are searching for healthier foods: IBIS expects the healthy eating index to rise 2.6%
from 2015-2019.
4. Tim Hortons has a gluten-free coconut macaroon.
U
5. About 40 million Americans are lactose intolerant. This also affects different ethnic and racial
groups. Based on research, 90% of the Asian population is lactose intolerant.
6. Starbucks K-Cups sales increased 47% in 2013.
ID
7. Restaurant Brands International purchased Tim Hortons and will most likely expand into the US.
Canada also has a lower tax rate than Dunkin' Brands does in the US.
8. Krispy Kreme launches Hot light android app.
9. Starbucks has acquired Teavana Holdings.
10. Starbucks has a loyalty program where customers receive stars for buying products in stores and at
ES
grocery stores and other retail locations.
2
Strategic Management: A Competitive Advantage, Concept and Cases, 18th edition
by Fred R David | Forest R. David
SC
O
R
EG
U
ID
ES
, Table of Content
PART 1: OVERVIEW OF STRATEGIC MANAGEMENT
The Nature of Strategic Management
The Cohesion Case: McDonald’s Corporation
PART 2: STRATEGY FORMULATION
Business Vision and Mission
SC
The External Assessment
The Internal Assessment
Strategies in Action
O
Strategy Analysis and Choice
PART 3: STRATEGY IMPLEMENTATION
R
Implementing Strategies: Management and Marketing Issues
Implementing Strategies: Finance and Accounting Issues
EG
PART 4: STRATEGY EVALUATION AND GOVERNANCE
Strategy Evaluation and Governance
PART 5: KEY STRATEGIC MANAGEMENT TOPICS
U
Business Ethics, Environmental Sustainability, and Corporate Social Responsibility
Global and International Issues
ID
PART 6: STRATEGIC MANAGEMENT CASE ANALYSIS
ES
, Forest R. David
A. Case Abstract
Headquartered in Canton, Massachusetts, Dunkin’ Brands (Dunkin’) sells hot and cold coffee and
baked goods, as well as hard-serve ice cream, using a near-100 percent franchised business model.
With 11,000 Dunkin’ Donuts restaurants in 40 states and 32 foreign countries, and 7,300 Baskin -
SC
Robbins restaurants in 43 states and 46 foreign countries, Dunkin’ is one of the world’s largest
franchisors of quick-service restaurants (QSR). All but 36 Dunkin’ Donuts and Baskin-Robbins are
franchisee-owned. In the last few years, more and more customers are coming into Dunkin’
restaurants and spending more and more money when they are there. About 70 percent of all Dunkin’
stores have a drive thru, which caters to consumers in a hurry. Dunkin’ is a speed leader among QSR,
even given increased ticket volume and menu complexity.
O
B. Vision Statement (actual)
R
To be recognized as a company that responsibly serves our guests, franchisees, employees,
communities, business partners, and the interests of our planet.
EG
(Proposed)
Our vision is to be recognized as having the most responsible brands with unbeatable quality,
affordability, and convenience in baked goods, coffee and ice cream specialty products.
C. Mission Statement (proposed)
U
Dunkin’ Brands aspires to be the leading company in the coffee, donut, and ice cream industries (3) by
providing baked goods, coffee, and ice cream specialty products (2) to busy consumers (1) worldwide.
ID
We pride ourselves on offering superior quality, service, and convenience. (7) We are committed to
responsibly serving (6) our customers, franchisees, employees (9), and communities, while focusing on
a sustainable and green future. (8) We seek to be the leading quick service restaurant in our industries
by keeping up with the latest technologies (4) and insight to grow sales (5).
ES
1. Customers
2. Products or services
3. Markets
4. Technology
5. Concern for survival, growth, and profitability
6. Philosophy
7. Self-concept
8. Concern for public image
9. Concern for employees
1
, D. External Audit
Opportunities
1. There is a growing demand for catering services or home and office delivery.
2. Consumers are searching for healthier foods: IBIS expects the healthy eating index to rise 2.6%
from 2015-2019.
SC
3. Increasing demand for products to be sold in retail stores: 29% of coffee drinkers said they use a
single-cup brewer to get their daily caffeine fix.
4. Breakfast sandwiches are the new burgers; breakfast sales at fast-food chains increased by 4.8%
annually from 2007-2012.
5. Gluten free allergies are becoming more prominent in the US. About 20 million Americans have
celiac disease and 30-50% of the population have gluten sensitivity.
6. Although the price of coffee has increased, the consumption will continue to slowly increase at an
annualized rate of 1.3% in the next five years.
O
7. Lactose intolerant products are a major worldwide need. Two-thirds of the world's adult
population have trouble digesting milk.
8. Due to the health benefits of tea, consumption is projected to rise at an annualized rate of 1.0%
over the next five years.
R
9. Low interest rates to refinance outstanding debt or expand.
10. Disposable income in the US will grow at a rate of 2.5% over the next five years.
Threats
EG
1. Price of coffee is projected to increase by 1.5% each year for the next five years.
2. Starbucks is going to be offering home and office delivery in select markets in late 2015 through
Postmates.
3. Consumers are searching for healthier foods: IBIS expects the healthy eating index to rise 2.6%
from 2015-2019.
4. Tim Hortons has a gluten-free coconut macaroon.
U
5. About 40 million Americans are lactose intolerant. This also affects different ethnic and racial
groups. Based on research, 90% of the Asian population is lactose intolerant.
6. Starbucks K-Cups sales increased 47% in 2013.
ID
7. Restaurant Brands International purchased Tim Hortons and will most likely expand into the US.
Canada also has a lower tax rate than Dunkin' Brands does in the US.
8. Krispy Kreme launches Hot light android app.
9. Starbucks has acquired Teavana Holdings.
10. Starbucks has a loyalty program where customers receive stars for buying products in stores and at
ES
grocery stores and other retail locations.
2
