California Pizza Kitchen

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A company’s strategic choices shape how that firm will operate and react to the use of its own resources as well as the affects of external factors. Porter tells us that firm’s position themselves by leveraging their strength’s. He argued that strengths ultimately fall into one of two headings: cost advantage and differentiation (Quickmba). CPK chooses and specifically points out differentiation as its main strategy. CPK differentiates itself through product quality through the use of quality ingredients, menu design and innovation, and expanded services and offerings beyond their main dining experience. This all falls under subcategory of differentiation known as “Quality Strategy”, which sets CPK apart from its competitors. CPK literature is littered with the idea of menu innovation, expansion of service options such as the new items, smaller express stores and growth/development in the frozen and fresh foods market in grocery stores. However, the current economic environment has played into CPK’s strategic choices recently as they have had to compete to maintain revenue, reduce costs and keep customers who are more and more turning to substitutes such as fast food or home cooked meals in an attempt to save money. Reviewing the mission and vision statement, CPK has a solid base that incorporates its corporate strategy very well. However, CPK must be careful not to become so focused on its current strategy that is forgets to measure pressures of external forces as well as the need for cost reduction that are weighing heavily in its business and profits. It is suggested that CPK look carefully at its current strategy to see if it can better leverage its internal strengths and potential for operational efficiencies.

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CALIFORNIA PIZZA KITCHEN; STRATEGIC CHOICES

A company’s strategic choices shape how that firm will operate and react to the use of its own resources as well as the affects of external factors. These choices are typically broken down into one of our distinct strategies (cost leadership, differentiation, niche focus, and first mover’s advantage) and applied as management sees fit. In studying California Pizza Kitchen (CPK) literature, one can easily decipher that their main strategy is differentiation with portions of first mover’s advantage tied in. CPK is very open about the approach as menu innovation is one of their key values. Having identified this strategy this paper looks to review this strategy against recently performed SWAT analysis to see how it is affecting CPK’s strategic choices. It will discuss whether those strategic choices remaining in line with its differentiation strategy. Additionally, this case study will determine whether the differentiation strategy and CPK’s strategic choices create competitive advantages or are they creating weakness that need to be addressed and countered with some of CPK’s strengths. Finally, a brief discussion on CPK’s mission and vision will be incorporated against the findings to determine what CPK is doing right and what they could possibly change to improve is competitive position.

Corporate Strategy
Porter tells us that firm’s position themselves by leveraging their strength’s. He argued that strengths ultimately fall into one of two headings: cost advantage and differentiation (Quickmba). CPK chooses and specifically points out differentiation as its main strategy. In its 2009 financial report, CPK states, “We believe that our concept, attractive price-value relationship and quality of food and service enable us to differentiate ourselves from our competitors”. Differentiation is a competitive business strategy whereby firms attempt to gain a competitive advantage by increasing the perceived value of their products and/or services relative to the perceived value of other firm's...
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