Graduate Business School

Master of Science in Strategic Management

Group Assignment Group 7

Name of students and Reg Numbers:

Robert B Mugayi C20140652K

Margret Chavazhinji C20140655N

Evangelista Muchineuta C20140524X

Zvikomborero H Mtariswa C20140614L

Tinashe Mtariswa C20140615L

Netsai Mhike C15126054O

Vongai Caritas Munosiyeyi C20140643C

Karen Matunga C20140727J

Precious Mureyani C20140385C

Alimah Mukwasani C15125985Q

Name of lecturer: Prof. C. Makanyeza

Course code: MSCSM603

Course Tittle Strategic Marketing Management

Due date: 30 March 2020

Assignment Weekend Class

Question: Conduct a value chain analysis for any Zimbabwean

organization of your choice. (20)
Value chain analysis is the series of activities, which a product or service goes through from
conception, through the phases of production, distribution to consumers, and final disposal
after use (Hellin and Meijer, 2006). They are of the view that a product appreciates in value
as it moves from one player in the value chain to another. As a result, the value chain is used
as a tool to divide a business into interdependent major activities, which allow the
identification of sources of competitive advantage (Zamora, 2016).

Porter (1985) suggests that the value chain analysis can be used as a tool in formulating a
company strategy. Value chain analysis can be used to analyse and understand the company’s
source of competitive advantage, formulate competitive strategies and identify important
linkages and develop interrelationships between activities that create value for both the
customers and the organisation at large (Ensign, 2001).

Below is a Value chain analysis for National Foods Limited. The company is into production
of wheat and maize products and its vision is to be the preferred supplier of branded FMCG
and stock feed products in Zimbabwe and selected regional markets.

Source: Chaffey, D. (2009). E-business and e-commerce management:

Inbound Logistics
The inbound logistics process refers to as the sourcing of the materials, tracking inventory
and optimizing the movement of goods from suppliers to the store, warehouse or
manufacturing plant, this is the first stage in the value chain. (Picincu, 2018). Thus the influx
of raw materials from suppliers to manufacturing facilities with activities, such as the storage
and distribution of raw materials and parts that are going to be used in production process.
This function covers all relationships with external companies such as suppliers. Raw
materials are materials or substances used in the primary production or manufacturing of
goods. In the case of National foods, the raw material are procured from Grain Marketing
Board, Contract farmers and import wheat from Germany and Canada. These raw materials
are then transported to National Foods by the company’s transport division.

National Foods Logistics

National Foods Logistics was created in the second half of the previous financial year, and is
responsible for the distribution of National Foods’ products to the market. The fleet now
comprises 42 trucks, of which 19 were acquired during the year. The fleet moved 31% of the
Group’s volumes during the year. The objective of improving distribution efficiencies is
steadily being achieved, albeit that progress was slowed by the need to deal with the
numerous day to day operational challenges. The Board has approved the acquisition of a
further 11 trucks in the year ahead (2019 financial report).
NATIONAL FOODS RELATIONSHIP WITH STAKEHOLDERS

Adopted from National Foods 2019 Report

National foods carries out suppliers screening to make sure that they get raw materials from
trusted and high quality sources. Face to face meetings are done with the suppliers in order to
get physical evidence of the suppliers quality and compliance to standards. An effective
inbound logistics program can result in higher quality products, more cost savings and
increased sales. At the end of the cycle, suppliers are paid in time to keep good relations and
to make sure that supplies of raw materials are consistent and un-interrupted.

Operations

An organisation should understand the flow of materials through a value chain, in order to
understand the opportunities and constraints in the processes and how to manage the risks
(Tarekegn ,Girma & Assefa (2017). Operations is one of the primary activities in the value
chain analysis. It focuses on transforming raw materials and components into new products.

National foods’s strategy as a manufacturing company rests upon ensuring production

efficiency as well as quality by adhering to international standards such as ISO9001, FSSC
2200 and the Global Reporting Initiatives (GRI) Standards. Further, we pay attention to
minimise negative impacts on the business and or stakeholders while maximising on
opportunities from sustainability issues in our business environment. Above all, our strategy
is to ensure the Group is responsive to external imperatives such as climate change,
Sustainable Development Goals (SDGs) and stakeholder concerns in places where we
operate.

National Foods is one of the largest manufacturers and marketer of food of food products in
Zimbabwe and the Southern Africa Region. National Foods is mainly known for the maize
and flour milling, it produces a wide range of food products including stock feed,
snacks,treats,rice, peanut butter and cooking oil as well as offer services in logistics,
properties and legal industries. It boasts of the following brands in its name Gloria, Redseal,
Mahatma, Parlenta, Snowwhite, BetterBuy, Zapnax, KingKurls, Shooter, Wingz, Iris and
Stockfeeds. National Foods produces their various brands and so the different production
processes provide value to their customers and their needs for example Mahatma rice comes
in 4 variants elegant white rice, jasmine rice, basmati rice and brown rice.

Firm infrastructure

The firm infrastructure of any organization plays an important role in the success of that
organisation. Firm infrastructure includes many activities such as the strategic management
system which provides, its services to the whole organization and includes accounting,
finance, information management, quality control, legal and relations with government
authorities. These activities support the whole value chain. National Foods’ has a very strong
financial base after it posted a profit after tax of $13 704 000.00 in its 2017 Annual Report.
2018 financial report shows a net profit of $17 175 000.00 (Annual Report, 2018). National
Foods maintains a good relationship with regulatory authorities such as EMA as evidenced
by its environmental responsibility activities such as waste management and carbon footprint.

Strategic management is often the starting point from which all decisions in an organization
are based on, (David 2016). National Foods’ overall strategy is clearly focused. Annual
strategic plans are compiled at both Group and business unit level, with detailed plans for
action and allocated responsibilities. They also review progress regularly. The wrong
strategy will make it extra hard for people on the work floor to perform well. Firm
infrastructure activities are collectively indicated as overhead costs which can be one of the
most powerful sources of competitive advantage for an organization.

Human Resources

National Foods thrives to attract and retain talented and passionate people for their business
and support them in their skills and knowledge development. They created a working
environment, which makes the employees feel that they are partners in fulfilling the mission,
founded on mutual trust, respect and dedication to performance, quality, and respect for each
other and undying passion for value creation as stated in the 2019 Annual Report.

National Foods Strategy

The NFL consists of highly motivated executives, management and support teams that help
them achieve its corporate strategy and goals. To achieve this, they focus on creating working
conditions that inspire the employees to achieve set targets. They are strongly committed to
labour and social standards that attract and retain excellent people and leaders whom they
continue to develop through long life learning and support.

The Management Approach

The NFL provides employment opportunities through various forms that includes short-term
contracts, casual positions, fixed term contracts and full time or permanent positions. These
opportunities are managed through adherence to local and international labour standards.
They allow employees to be members of trade unions of their choice in the business sectors
to enable them to build sustainable relations. NFL has managed to retain its staff by giving
them competitive salaries and benefits hence their labor turnover rate is very low. The
employees have proved effective in fulfilling the business strategy in implementing all
primary activities, which include marketing, logistics and operations among others. The staff
complement as at end of 2019 was 1 509 employees with 1003 males and 506 females.

Employee skills base

According to the annual report of 2019, National Food Limited maintains a skills base that
allows sustainable value creation. Some of their employees are members to the following
professional bodies:

 Institute of Chartered Accountants Zimbabwe (ICAZ)

 Association of Chartered Certified Accountants (ACCA)

 Chartered Institute of Management Accountants (CIMA)

 Institute of Chartered Secretaries and Administrators Zimbabwe (ICSAZ)

 Chartered Institute of Logistics and Transport (CILT)

 Institute of People Management in Zimbabwe (IPMZ)

 Institute of Marketing Management - South Africa (IMMSA)

Work related accidents / injuries

The NFL considers health and safety in the work place as critical to all their businesses. Any
incidences are treated seriously and they receive the necessary attention. Regular audits are
conducted to ensure safety measures are in place at all times and appropriate training
conducted to ensure that all employees are aware of health and safety issues. The
organization’s policy is to ensure incidences are kept as low as possible according to the 2019
Annual Report.

Health and safety

The NFL’s commitment to health, safety and welfare for all of its employees requires all
businesses to ensure that they adopt and apply best practices at all times. The employees’
workers council works with trade unions on key topics and standard practices on health and
safety observed in factories and operations. The employees are members to several trade
unions. During the year, major topics are discussed at various employees’ sessions as
presented below.
Figure: Extract from the 2019 Annual Report

Enhancing employee’s wellness

National Foods Limited continues to support and prioritize safety, health and well-being of
employees and their families through the Wellness Programs. The wellness interventions,
which include counselling and coaching, have continued to help manage and mitigate some
adverse effects on employees. Experienced and trained personnel who provide the best
support to the employees man all NFL centres.
Technology development

The core values of National foods Limited is to relentlessly pursue Innovation to improve the
livelihoods of consumers. Customers and consumers are at the core of what they do. They
produce affordable and nutritious products for all market segments.

Technology development can be used to obtain competitive advantage and is very important
in this technology driven era. Technology can be used for various activities including to
reduce production costs, innovations in developing new products and improving existing
products and also improving customer services. These activities create value using innovation
and optimization. At National Foods, the processing plants are equipped with the most
modern machinery and technology available in the world today. Their product design and
quality has improved by 88%. They have greatly reduced their waste levels and downtime by
80%. Innovation has allowed them to respond well to market needs and demands as
improvements within the value chain have been awarding them with flexibility (Chirata,
2011).

Marketing
We manufacture and distribute a diversified portfolio of branded FMCG products to the
consumer mass market. To delight our customers and consumers through delivering
profitable category based initiatives.

Revenue from sale of goods is recognised at the point in time when control of the good is
transferred to the customer, generally on delivery or collection. The normal credit term is 30
days upon transfer. The Group considers whether there are other promises in the contract that
are separate performance obligations to which a portion of the transaction price needs to be
allocated (e.g., warranties, customer loyalty points). In determining the transaction price for
the sale of goods, the Group considers the effects of variable consideration, the existence of
significant financing components, noncash consideration, and consideration payable to the
customer.

Service

This includes all activities implemented to maintain the value of the products or service to
customers after the purchase of a product or service. This may include guarantees, warranties
and after sales training. Quick response to customer enquiries and queries is important so as
to prevent brand and reputational damage from disgruntled customers. According to Chirata
(2011), National Foods, the organisation enhanced greater responsiveness to customer
demands and improved turnaround times by 68%. National foods is also making use of social
media platforms such as Facebook to enhance and maintain the value of their various
products.

References
Picincu, A. (2018). What Is Inbound Logistics & Manufacturing? Chron.

Surbhi, S. (2017). Difference Between Inbound and Outbound Logistics. Key differences.

Tarekegn, K.,Girma, G & Assefa, A.(2017) Value Chain Analysis of Honey in Kaffa &
Sheka Zones of SNNPR, Ethopia.International Journal of Research in Agricultural Sciences
Volume 4 Issue 3

Annual Report (2018) National Foods Holdings Limited

David, F. (2016). Strategic management, (12th ed); Cultural researches publication: Tehran,
Iran,

Hellin, J. and Meijer, M. (2006) Guidelines for Value Chain Analysis. Food and Agriculture
Organization of the United Nations (FAO), Rome, Italy.

Chirata, C(2011), Impact of innovation on Firm Competitiveness in the Milling Industry in

Zimbabwe – A Case Study of National Foods Limited. (2005 – 2010), University of
Zimbabwe

Annual Report (2019), National Foods Holdings Limited

Porter, M. E. (1985) The Competitive Advantage: Creating and Sustaining Superior

Performance. NY: Free Press.

Zamora, E. (2016). Value Chain Analysis: A Brief Review. Asian Journal of Innovation and
Policy. 5. 116-128. 10.7545/ajip.2016.5.2.116.
www.nationalfoods.co.zw