South Beauty Group Case Analysis

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I will use the Resources, Capability and Core Competences (RC&C) model and Value Chain Analysis (VCA) to analyse and determine the competitive advantage and strategy competitiveness of South Beauty Group.

A firm has a competitive advantage when it implements a strategy competitors are unable to duplicate or find too costly to imitate (Ireland, Hoskisson and Hitt, 2011, p. 4).

Strategic competitiveness is achieved when a firm successfully formulates and implements a value-creating strategy (Ireland, Hoskisson and Hitt, 2011, p. 4).

RC&C model

Resources

|Tangible Resources |Observations | |Financial Resources |South Beauty Group’s estimated revenue in 2007 was RMB 384 million. | |Organization Resources |South Beauty Group’s structure has 2 divisions: head office functions and restaurant operations. | | |The head office manages the finances, HR, R&D marketing, quality control of food supply and strategy of | | |the company. | | |Individual restaurants manage its own operation, and a department specialise in managing and setting up | | |franchises. | |Physical Resources |As at 2007, South Beauty Group owns a total of 20 restaurants, 13 in Beijing, and 6 in Shanghai and 1 in| | |Chengdu. | | |Locations of restaurants are placed at office building in major cities in order to attract its target | | |customers. | | |Has a central kitchen to prepare uncooked raw material and main dish packets, and send to its various | | |restaurants for cooking. | |Technological |Establish its own CRM system to record customer information. | | |Built an ERP system for purchasing process and to control key financial variables. | | |Uses remote conference system to enhance internal communication between all its restaurants. | |Intangible Resources |Observations | |Human Resources |Waiters are trained at the company’s training center for a duration of 3 months. Restaurant managers are| | |to undertake a two years on-the-job training program. | | |Recruited Chinese executives from Coca-Cola and MacDonald’s. | | |Engage consulting firm to create new people management system to motivate workers. | |Innovation Resources |Has an independent R&D team to create new dishes. | | |Combines Chinese and Western cuisine and creates original new flavors. | | |Developing healthy and stylish cuisine....
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