Industry and Company Analysis Project (ICAP) (200 Points)
The company is Dunkin Donuts
This project is to be completed on an individual basis. Each student will first choose an industry to evaluate and then prepare an industry analysis. This first section must be turned in no later than February 17. Step 2 is to select a publicly traded company that competes in that industry. A company profile and strategy analysis must be completed for that company in addition to an evaluation of the fit between the company’s external environment, its strategies, and its capabilities. This second section of the report must also include a set of recommendations for the company. This second section must be turned in no later than March 24. Sections of the paper turned in late will be assessed a 10 point penalty for the first day and an additional 5 points for each day thereafter.
Report should be a WORD document, double-spaced in 12 Font. You will upload the file as an Assignment in Blackboard. The first section of the report can be no longer than five pages, the second section no longer than seven pages.
Please cite the documents or websites that you reference and include a reference section (not included in the page limits) at the end of each section with the detailed citations. Your report will be submitted into Blackboard.
Note: You must provide the name of the company that you will study and its associated industry to the instructor no later than February 10. Only one student will be allowed to study an individual company, so get your company of choice approved early. In addition, the company cannot be one of the companies portrayed in the cases in the textbook.
SECTION 1: Industry Analysis (due February 17) – 100 points
Select an industry for analysis that you find interesting. Examples of industries used in past student reports include: pharmaceuticals, telecommunications, banking, soft drinks, textiles, fast food, automotive, software, toys, furniture manufacturing and many more. In the second section of this assignment you will focus on one of the publicly traded companies that compete in this industry for strategic analysis. Make sure that you have gotten instructor approval for the company no later than February 10 to ensure that you are analyzing the relevant industry.
Industry Analysis (please define/describe the industry you are analyzing)
The analysis should consist of three parts.
The first part should describe the most important forces/trends from the General Environment that will affect this industry in the future, that is, what are the broad trends that will most greatly affect this industry going forward.
The second part of this section should focus on the Five Forces Model. Please analyze your industry with respect to each of the five forces and state and defend the type of downward pressure (high, medium, or low threat) that each force and the sum of the forces exert on industry profitability.
The third part should list the major competitors within the industry and their approximate market shares for a recent time period.
Sources of Information
Students should use the library’s online databases or reference books for the majority of their research as well as other internet accessible sources.
SECTION 2a: Strategic Analysis (due March 24) – 75 points
This section should focus on a company (or a key division in a corporation) that competes in the industry that you evaluated in your Industry Analysis section. The company should be publicly traded on a stock exchange.
Identification of Company Strategy
This section should contain five parts.
The first part should contain the following profile information and should be displayed in bullet form:
Company (or Division) Name
Location of its headquarters
Company Mission and/or Vision Statement or an equivalent statement of purpose
Total Assets or Total Employees (company or division)
Stock Exchange on which it is traded, its ticker symbol, recent price per share
Name of CEO or equivalent
In part two describe the strategy that the company is using to compete in this industry and provide supporting evidence for your conclusion with respect to the strategy.
For part three, perform a financial analysis for your company (or the corporation that the division is part of) and at least two of its closest competitors. The analysis should be based on at least three recent years and should, at a minimum, cover the following dimensions of the companies’ condition and performance:
Returns on assets and equity
Liquidity (current ratio or quick ratio)
Profitability (EPS growth rate, gross profit margin)
Financial leverage (Debt to Asset, Debt to Equity Ratios)
In this analysis it is important to compare your company (or corporation) with its competitors to determine its competitive position and how it might be changing over time. Therefore, you should select ratios that are appropriate for the industry in which your company operates. The necessary financial information should be available from annual reports, 10-k’s, quarterly reports, and proxy statements. There are numerous library and online sources that you can use, including the companies’ investor relations link on their websites. In your analysis provide an interpretation of the results, which I expect you to use in the next section.
Based on your analysis of company performance, part four should identify the company’s source(s) of competitive advantage (distinctive competencies) and describe how they meet the VRIO criteria. If your company is performing worse than its competitors, identify the competitors’ sources of advantage and discuss where your company is deficient with respect to the relevant resources and capabilities.
SECTION 2b: Fit and Recommendations (due March 24) – 25 points
You have now analyzed the industry, strategy, recent performance, and distinctive competencies, of the company (or division) you selected. Your final task is to review those sections and evaluate whether the company’s strategy and capabilities “fit” well in its environment (that is, are they well positioned to take advantage of the opportunities and mitigate the threats existent or developing within this environment). Present your evaluation, which should reflect your industry and strategic analyses from above.
In addition, list two future strategic actions that you would recommend for this company and describe how each of the actions would enhance their fit or competitive position in the industry.