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PREPARED AND SUBMITTED BY GROUP 2

ROSLAN ABD KARIM (MR081075) 
MEHDI ABBASNIA (MR081182) 
JIANG HONG (MR081082) 
NIMA KHODAKARAMI (MR081189) 
MUHAMMAD ZULFAKAR AHMAD 
(MR081062) 
GROUP LEADER: 
ARASH VOSSOUGHI (MR071108) 
Foreword 

Based on the strategic decision‐making approach, in the first step, we evaluated 
Rogers’  Chocolates  current  performance.  A  summary  of  financial  ratios  has 
been  presented  as  Appendix  1.  We  had  a  review  over  the  company’s  current 
mission,  objectives,  strategies,  and  policies  (Appendix  2).  In  the  second  step, 
based on the case information, performance of the firm’s Top Management has 
been  reviewed.  Later,  we  have  scanned  external  environment  of  the  firm  in 
order  to  determine  the  strategic  factors  that  pose  opportunities  and  threats. 
Then  the  internal  environment  of  Rogers’  Chocolates  has  been  scanned  to 
determine the strategic factors that are Strengths and Weaknesses and we did 
an in depth SWOT analysis to pinpoint problem areas (Appendix 3). In the light 
of the analysis, we have tried to follow the strategic decision‐making approach 
in case analysis and decision based on the exclusive framework of Dr. Lai. 

 
NOTE: Appendixes have been attached to the hard copy of this document 
IBS, UTM CITY CAMPUS, STRATEGIC MANAGEMENT, MRB 3012, CASE ANALYSIS & DECISION, ROGERS’ CHOCOLATES, GROUP 2, JULY 2009 

Rogers’ Chocolates 

1. STRATEGIC MATTERS:

Two different types of strategic matters that need strategic decisions have been identified:

SOLVING ORGANIZATIONAL PROBLEM ACHIEVING ORGANIZATIONAL OBJECTIVE


“Overcoming production and operation problems” “Achieving 200% - 300% growth rate within 10 years”

2. ISSUES: In order to address each of the strategic matters, the most important things to do are:

Issue 1: Whether to implement integrated production planning and operation control systems.

Issue 2: Whether to develop a new concept of product and packaging

Issue 3: Whether to expand online selling system

Issue 4: Whether to expand retail sales system

3. ALTERNATIVES: Generated alternatives for each of the identified issues are:

Issue 1: Whether to implement integrated production planning and operation control system.
A 1: No. Coping with the current situation
A 2: Yes. Implementing integrated system for production plan and controlling operation

Issue 2: Whether to develop new concepts of product and packaging


A 1: No new product development and retaining on traditional concept products of packaging.
A 2: Yes. Introducing new concepts of products with more customizable and fashionable packaging

Issue 3: Whether to expand online selling system


A 1: No. Current system is good enough
A 2: Yes. Expanding online selling system and e-marketing

Issue 4: Whether to expand retail sales system


A 1: No expansion
A 2: More emphasize on retail rather than wholesales
A 3: Expanding retail system within the region
A 4: Expanding retail system to other parts of the country 

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IBS, UTM CITY CAMPUS, STRATEGIC MANAGEMENT, MRB 3012, CASE ANALYSIS & DECISION, ROGERS’ CHOCOLATES, GROUP 2, JULY 2009 

4. CRITICAL FACTORS 

Issue 1: Whether to implement integrated production planning and operation control systems.

C. FACTORS CURRENT SITUATION FUTURE SITUATION LOGICAL ASSUMPTION

Productivity There are no meaningful Measuring performances to Ability to recognize value


and efficiency measures of productivity or recognize efficient versus added activities from
measurement efficiency existed. inefficient activities inefficient activities.

Out-of-stock issue Deals with ups and downs of


Inventory Shortage / surplus
sales pattern through healthy
Management Over stock items avoidance
inventory management

Long change over-times, Cost is controlled by wastage


Control over the operation
repetitive shipments, reduction, value analysis,
Cost of cost and efficient utilization
opportunity cost due to inventory control, on-time
operation of resources result in gaining
shortage, and discount over delivery and efficient
competitive advantage
surplus items utilization of all resources.

Mutual understanding of the


Communication It establishes vertical and
Weak internal capabilities, competencies
between horizontal channels for a
communication and constraints of each
functions better communication
organizational function 

Issue 2: Whether to develop new concepts of products and packaging

C. FACTORS CURRENT SITUATION FUTURE SITUATION LOGICAL ASSUMPTION

Change in One line of trans-fat- Satisfying increasing number of


Differentiation from the
consumer free products and some health conscience consumers will
rivals
preferences no sugar added items distinguish the firm from its rivals.

New generation of customers want


Packaging and Attracting diverse
Traditional, old fashion more glitzy, fashionable and more
customizability group of customers
customizable products and packaging

Issue 3: Whether to expand online selling system

C. FACTORS CURRENT SITUATION FUTURE SITUATION LOGICAL ASSUMPTION

Mostly within Canada Capturing a broader Online selling system enable firms
Global sales
and US. market to capture a broader market

Capturing a Mostly loyal customers


Attracting younger and Younger generation tend to do
new customer from rural areas (60%
new customers everything online!
segment are regular customers)

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IBS, UTM CITY CAMPUS, STRATEGIC MANAGEMENT, MRB 3012, CASE ANALYSIS & DECISION, ROGERS’ CHOCOLATES, GROUP 2, JULY 2009 

Only a “thank you” Giving gift/discount


Giving It encourages customers to buy
letter along with after a certain amount
gift/discount more
catalogue of buying

Higher brand image due Aggressive e-Marketing is a


Aggressive
NO to aggressive branding tool that keeps you on
e-Marketing
e-Marketing activities customers' minds.

Customer Giving gift, bonus, discount, and free


NO Loyal online customers
loyalty program delivery keep the customers loyal

Issue 4: Whether to expand retail sales system

C. FACTORS CURRENT SITUATION FUTURE SITUATION LOGICAL ASSUMPTION

It seems that retail shops are able to


Increase Sales 50% of sales Increase in sales
sell more chocolate (p. c-182)

Unknown brand outside More brand awareness Well trained and more dedicated
the Victoria. Also, some outside the region via employees enable to present the
Brand awareness
reps cannot present the well trained and more brand adequately and appropriately
brand adequately. committed employees sell it outside the region.

Taking
Presence in a wider market along
advantage of
No growth Higher growth rate with more brand awareness enables
the growing
the firm to gain a higher growth rate.
market

Selling in a Presence in a wider


Niche market Expanding retail sales to
broader market market

5. EVALUATION OF ALTERNATIVES 

5.1, Issue 1: Whether to implement integrated production planning and operation control systems.

ALTERNATIVES

CRITICAL FACTORS BASED ON FUTURE SCENARIO Implementing integrated


Coping with the
production planning and
current situation
operation control systems

Recognizing efficient versus inefficient activities NO YES

Shortage / surplus avoidance NO YES

Control over the operation cost and efficient utilization


NO YES
of resources result in gaining competitive advantage

Mutual understanding of the capabilities, competencies


NO YES
and constraints of each organizational function 
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IBS, UTM CITY CAMPUS, STRATEGIC MANAGEMENT, MRB 3012, CASE ANALYSIS & DECISION, ROGERS’ CHOCOLATES, GROUP 2, JULY 2009 

  5.2, Issue 2: Whether to develop a new concept of product and packaging.

ALTERNATIVES

CRITICAL FACTORS BASED ON


No new product development Introducing new concepts of
FUTURE SCENARIO
and retaining on traditional products with more customizable
concept products of packaging and fashionable packaging

Differentiation from the rivals NO YES

Attracting diverse group of customers NO YES

5.3, Issue 3: Whether to expand online selling system

ALTERNATIVES
CRITICAL FACTORS BASED ON FUTURE
SCENARIO No. Current system is Expanding online selling
good enough system and e-marketing

Capturing a broader market NO YES

Attracting younger and new customers NO YES 

Giving gift/discount after a certain amount of buying NO YES 

Higher brand image due to aggressive e-marketing NO YES 

Loyal online customers NO YES 


 

5.4, Issue 4: Whether to expand retail sales system.

ALTERNATIVES
CRITICAL FACTORS
BASED ON FUTURE More emphasize on Expanding retail Expanding retail
No
SCENARIO retail rather than system within the system to other parts
expansion
wholesales region of the country

YES, but less than the


Increase sales NO NO YES
next alternative

More brand awareness


outside the region via well YES, but less than the
NO MODERATE YES
trained and more next alternative
committed employees

YES, but less than YES, but less than the


Higher growth rate NO YES
the next alternative next alternative
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IBS, UTM CITY CAMPUS, STRATEGIC MANAGEMENT, MRB 3012, CASE ANALYSIS & DECISION, ROGERS’ CHOCOLATES, GROUP 2, JULY 2009 

6. STRATEGIC DECISION

Rogers’ Chocolates will be able to address both of its aforementioned strategic matters through the
following stepwise decision process:

1. First and foremost, Parkhill is to address the firm’s production and operation problems by
implementing integrated production planning and operation control system. This will help him to
gain a proper control over the business.

2. In the next step, he should develop new concepts of products and packaging in order to
attract diverse group of customers.

3. The third step will be to develop and expand the firm’s online selling system. This will be a
platform for the firm to capture a broader market and attract younger and new customers.

4. After the three aforementioned steps, Roger’s will be ready for expanding. Expanding retail
sales for the Roger’s will take place in two steps as followed:

4.1 Expanding retail sales within the region.


3.2

4.2 Expanding retail sales within the region.


3.1

7. IMPLEMENTATION ACTION PLAN

• Regarding to numerous internal problems that Rogers’ is currently facing, prior to any other strategy
implementation, Parkhill should address these problems by implementing integrated production planning and
operation control systems as soon as possible. It needs a watchful eye to analyze each and every function in
order to find out the best way of doing the job. This is a teamwork job under direct supervision of the CEO.

• Rogers’ can take advantage of change in consumer preferences for organic and healthier chocolate. At the
other hand, Rogers’ old fashion way of packaging products seems to be one of the main causes of the
firm’s slowdown. Therefore, new concepts of products and packaging need to be developed in order to
differentiate the firm from its rivals and to attract diverse group of customers. Marketing research and
consumer preferences survey should be conducted in order to find out what exactly consumers need. This
strategy should be implemented right after finishing the previous one.

• Currently, Rogers’ is confronting with “customers aging” issue. At the other hand, today people tend to do
everything Online! Therefore, expanding online selling system and e-marketing will help the firm to
capture a broader market as well as younger generation. Rogers’ is to develop an easy to navigate, multi
lingual website and doing aggressive e-Marketing activities as well as to try to take the highest rank in pioneer
search engines. Parkhill can implement this strategy simultaneously with the previous with the help of
Marketing VP and a reliable IT counselor.
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IBS, UTM CITY CAMPUS, STRATEGIC MANAGEMENT, MRB 3012, CASE ANALYSIS & DECISION, ROGERS’ CHOCOLATES, GROUP 2, JULY 2009 

• After successfully implementing all mentioned strategies, Rogers’ will be ready for expanding its retail sales system. Analysis and records
prove that this is the best strategy to take advantage of the growing market. Expanding retail sales for the Roger’s will take place in two
steps. In the first phase, Parkhill should acquire 3 retail shops in downtown Victoria with long term lease agreement. Marketing VP should help
him in finding the most appropriate location. After two years, positive results of the previous implemented strategies and after gaining the
projected ROI will be ready for more expansion. To presence in a wider market and taking more advantage of the growing market, Rogers’
will continue its expansion through acquiring high-end retailers in Vancouver, Ontario, and Whistler. CEO, with assistance of Marketing VP are
responsible for implementing expanding retail sales strategy.

Rogers’ implementation action plan has been summarized in the following table:

STRATEGIC DECISION MADE


Implementation
1. Production planning and 3. Expanding online selling 4. Expanding retail system
Actions 2. New concepts of products
operation control systems system and e-marketing 4.1 Within the region 4.2 Outside the region

WHAT Production planning and New concepts of products and Expanding online selling
Expanding retail sales Expanding retail sales
to implement? operation control systems packaging system and e-marketing

To presence in a wider To presence in a wider


WHY To gain a control over the To differentiate and attract To capture a broader market &
market & higher growth market & higher
to implement? business diverse group of customers attract younger customers
rate growth rate

Based on consumers
Engineering all functions to Easy to navigate, multi lingual
HOW preferences survey, producing 3 retail shops with long Through acquiring
find out how resources are to website and aggressive e-
to implement? organic products with more term lease agreement high-end retailers
be utilized Marketing
contemporary packaging

WHERE Vancouver, Ontario,


Inside the organization Inside the organization Rogers’ website Downtown Victoria
to implement? Whistler

WHEN ASAP, and should be finished at Simultaneously with the After finishing the 2nd After finishing the 4th
Right after the 1st strategy
to implement? the end of 2009 previous strategy strategy strategy

WHO CEO, with assistance of VPs of CEO + Marketing VP + reliable


CEO + Marketing VP CEO + Mktg. VP CEO + Mktg. VP
to implement? all functions IT counselor

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IBS, UTM CITY CAMPUS, STRATEGIC MANAGEMENT, MRB 3012, CASE ANALYSIS & DECISION, ROGERS’ CHOCOLATES, GROUP 2, JULY 2009 
8. POTENTIAL PROBLEM ANALYSIS
STRATEGIC DECISION MADE
Implementation
1. Production planning and 3. Expanding online selling 4. Expanding retail system
Actions 2. New concepts of products
operation control systems system and e-marketing 4.1 Within the region 4.2 Outside the region

Potential Negative reactions and a. Threat of entry Not gaining the


Shift in consumers preferences Intense competition
Problem resistances b. Cost of shipments projected return

a1. Customer loyalty program a. Brand awareness


Frequently informative and Strong marketing
Contingency a2. Aggressive e-Marketing activities
persuasive speeches and Continuous marketing research campaign and
Plan b. Free or discounted b. New product
meetings branding activities
delivery development (NPD)

a1. Customer loyalty program Gradually a. Brand awareness


A series of informative and
WHAT a2. Aggressive e-Marketing implementation along activities
persuasive speeches and Continuous marketing research
to implement? b. Free or discounted with marketing b. New product
meetings to manage resistances
delivery campaign development (NPD)

a1. To keep customers loyal


To prevent and reduce To back to the
WHY To make the firm up to date in a2. To reach to as much as To prevent of losing
resistances and encourage projected growth rate
to implement? terms of consumer preferences possible customers market share
employees to participate and minimize loss
b. To increase online sales
a. Well trained staff c. Well trained staff
Showing befits and positive Cutting cost of inefficient should adequately
HOW Continuous marketing research should adequately
outcomes to employees through activities to offer more free or present the brand
to implement? and online surveying present the brand
frequent meetings with discount delivery b. Strong marketing d. Intensively NPD
campaign
WHERE Online survey and throughout In stores & inside the In stores & inside the
Inside the organization Throughout the WWW
to implement? the market organization organization

WHEN Starts before implementation Starts before implementation


Proactive strategy Proactive strategy Proactive strategy
to implement? and will be continued and will be continued

WHO CEO + Mktg. VP +


Roger Parkhill, CEO CEO + Marketing VP CEO + Marketing VP CEO + Mktg. VP
to implement? Retail staff

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IBS, UTM CITY CAMPUS, STRATEGIC MANAGEMENT, MRB 3012, CASE ANALYSIS & DECISION, ROGERS’ CHOCOLATES, GROUP 2, JULY 2009 

9. CONCLUSION

In this case, we deal with two different types of strategic matters: a series of organizational problems as
well as an organizational objective desired by the Board.

With regards to the plentiful organizational problems of the Rogers’, first and foremost, CEO should
address these problems by implementing integrated production planning and operation control systems to
gain a proper control over the business.

While projected growth rate for the premium chocolate industry is 20%, Rogers’ was not successful to
proportionately grow. Analysis shows that Rogers’ suffers from old fashion way of packaging that seems to
be one of the main causes of the firm’s slowdown. Also, there is a change in consumer’s preferences for
organic and healthier chocolate. Rogers’ can take advantage of this opportunity by introducing new
concepts of products and packaging in order to differentiate the firm from its rivals and to attract diverse
group of customers.

In addition, Rogers’ is confronting with “customers aging” issue. At the other hand, today people tend to
do everything Online! Therefore, expanding online selling system and e-marketing will help the firm to
capture a broader market as well as younger generation.

Rogers’ will be ready for expanding its retail sales system. Analysis and records prove that this is the
best strategy to take advantage of the growing market. It has been suggested to Rogers’ to divide its
retail expanding strategy into two steps:

• Expanding retail sales system within the region (Victoria and British Colombia), and then
• Expanding retail sales system to other parts of the country

As we have learned, there will be definitely some issues that may prevent of successfully implementing
any strategy. A table consists of detailed implementation plan for managing the potential problems has
been provided in page 7.

Page | 8  
 
Appendix 1. Quick Overview on Financial Performance of Rogers’ Chocolate (2005‐06) 

LIQUIDITY RATIOS  Ratio  2005  2006 

This  series  of  ratios  reveal  Rogers’  Chocolates  ability  to  pay  off  its short‐
terms debts obligations. Although, having a current ratio over 1 is normally 
Current Ratio  1.24 1.36
acceptable, however, current ratio would overestimate a company's short‐
term financial strength. Therefore, quick ratio that excludes inventories has 
been calculated. It tells us that most part of the assumed liquidity of Rogers’ 
belongs  to  inventory.  As  we  know,  most  of  times  it  is  difficult  to  turn  Quick Ratio  0.57 0.46
inventories to cash. 

ASSET MANAGEMENT RATIOS 
Inventory 
In  order  to  measure  how  effectively  Rogers’  is  managing  its  assets,  assets  7.73 7.67
Turnover 
management  ratios  have  been  calculated.  As  can  be  seen,  Rogers’  low 
turnover implies poor sales and, therefore, excess inventory. 

High  inventory  levels  are  unhealthy  because  they  represent  an  investment 
Total Assets 
with a rate of return of zero. In addition, low asset turnover of Rogers’ shows  1.40 1.41
Turnover  
inefficient using of assets in generating sales. 

DEBT MANAGEMENT RATIOS 

Rogers’ very low level of debt management ratios indicates that the firm  Debt Ratio  43% 32%

has  much  more  assets  than  debt.  Used  in  conjunction  with  other 
measures of financial health, very low level of debt ratio can be translated 
as the  firm’s high  degree of  being  risk  adverse. In  other words,  it  shows  Debt to 
78% 48%
the  extent  to  which  Rogers’  Chocolates  uses  debt  financing  or  the  firm’s  Equity Ratio 
ability to meet financial obligations 

PROFITABILITY RATIOS  Gross Profit 
54.55% 55.15%
Analyzing Rogers’ profitability ratios revealed:  Margin 

• Sales has declined in 2006 
• Profit Margin has declined in 2006 
Net Profit 
• Rogers’ has a very good gross profit margin, but suffers from very  8.9% 7.5%
Margin  
high cost of operation 

 
Appendix 2.  Mission, Objectives, Strategies 
HISTORY 
Rogers' Chocolates is steeped in tradition and a rich history that has earned the company its current
reputation as one of Canada's premiere chocolate makers.
The first Rogers' chocolates were made in 1885 by Charles "Candy" Rogers in the back of his
grocery store in Victoria, B.C. He quickly became a popular man. In 1891, Rogers expanded his
chocolate operation to the company's current heritage storefront on Government Street in Victoria
and the rest, as they say, is history.
Today, Rogers' Chocolates is owned by a small group of shareholders located primarily in B.C.
The Victoria-based company now has 10 retail stores, several hundred wholesale outlets, and a
20,000-square-foot factory.

MISSION STATEMENT 
Rogers' Chocolates is committed to producing and marketing fine products which reflect and
maintain our reputation of quality and excellence established for over a century. All aspects of our
business will be conducted with honesty and integrity, upholding our proud Canadian tradition.

PHILOSOPHY 
Rogers' Chocolates honors its time-tested brand by:

• making only premium products


• packaging them elegantly
• and choosing our retail partners carefully
We also believe that the quality of our products starts with the procurement and mixing of fine
ingredients but extends to the high level of customer service you can expect from all facets of our
organization.
Eliminating the use of hydrogenated fats and oils, and using natural ingredients whenever possible,
has positioned Rogers' as a leader in the confections industry, providing healthy alternatives to
consumers.
As quality chocolate continues to gain popularity among health-conscious, educated consumers,
Rogers' products are becoming increasingly revered for their aesthetic appeal, wholesome
ingredients, and overall exceptional taste.

STRATEGY 
Reviewing the case and visiting the firm’s website reveal that Rogers’ strategy is to produce
premium quality chocolates which are handmade, hand packed and highly customizable. It seems
that Rogers’ is trying to differentiate itself from the rivals  
APPENDIX 3.  ROGERS’ CHOCOLATES SWOT ANALYSIS 
             

Internal Factors  External Factors 
STRENGTHS  OPPORTUNITIES 
9
9
Premium Quality Products 
Knowledgeable and Dedicated Management & Personnel 
S 9 High Industry Growth Rate 
O
9 Change in Consumer’s Preferences for Organic Chocolate 
9 Loyal Customers in the Region 
9 Public Demand for buying Products mostly from Social & 
9 Superior Brand Image and Perception in Victoria 
Environmental Responsible companies 
9 First‐rate Internet Website 
9 Expanding Online Sales 
9 Several Key Retail Locations & Excellent In Store Experience  
9 Expansion Outside the Region 
9 Outstanding Market Leadership (Award Winning) 
9 Olympics 2010 
9 Innovative Customer and Employee Relations (Award Winning) 

WEAKNESSES  THREATS 
'
'
No Measurement for Productivity & Efficiency 
Weak Production Planning 
W ' Economy Slowdown 
T
' High Cost of Operation  ' Entry of Giants such as Cadburys & Hershey’s to the Industry 
' Poor Logistics, Weak  Sales Network & Incapable Sales Reps   ' Loyal Customers are Aging 
' Old Fashion Packaging  ' Public Health Consciousness & Threat of Shifting to Healthier 
' Poor Inventory Management  Substitutes 
' Unknown Brand Outside the Region 
' Limited Financial Resources & Poor Cash Flow Management 
Bibliography 

• Lai, Y. C. (Director) (2009, July 12). Case Analysis and Decision. Strategic Management
(MRB 3012), IBS, UTM City Campus, Kuala Lumpur.

• David, F. (1986). Fundamentals of Strategic Management. New York: Macmillan Pub Co.

• Gamble, J., J., A., Thompson, A., & Strickland, I. (2009). Crafting & Executing Strategy:
The Quest for Competitive Advantage: Concepts and Cases. Boston: Mcgraw-Hill College.

• Rogers' Chocolates. (n.d.). Retrieved July 18, 2009, from http://www.rogerschocolates.com/