OSI in China Case Solution And Analysis, HBR Case Study Solution & Analysis of Harvard Case Studies

Internal Analysis

At the moment the company, OSI has a competitive advantage in the industry through the well-developed vertical integration of the supply chain processes for the company. OSI has maintained a strong relationship with its local suppliers and developed partnerships with them to actually accommodate and facilitate the requirements of Yum and McDonalds. The alliance with local suppliers to provide raw material has benefited the company. Local suppliers have helped improve quality, efficiency, consistency and have helped OSI to achieve profitability and growth. Along with this the company, OSI has developed vertical integration with three different regions Shandong, Guangze and Zihua. These all vertical integrations prospects by the company have accounted for the company as a competitive advantage. This has been a competitive advantage for the company because vertical integration has actually developed strong roots of the company in the Chinese region. Along with this, it has helped OSI to form partnerships and alliances with local suppliers in to manufacture reduced priced products.

VRIO Analysis

The internal resources and capabilities of OSI have been effectively managed by the company and have actually made it a competent force not only in the Chinese market but also in the international arena. The internal resources of the company are the strong leadership that has actually made the company grows enormously. Along with this, the brand equity has also been a competitive resource for the company as big fast food chains have aligned with OSI to provide them with raw materials. Furthermore, the strong distribution network that is based on vertical integration has again been an internal resource for the company.

The internal capabilities of OSI have been the low-priced and high-quality production of the company. OSI has maintained a low cost structure right from the start of its operations. Along with this, the company has also been maintaining strong relationship with foreign outlets that have accounted for better opportunities globally for the company.

Distinctive Competency

The distinctive competency for OSI is the strong relation of the company with large foreign fast food restaurants and QSR in the world. OSI has served the needs of large chains such as McDonalds and Yum which has actually made the image of the company grow stronger and more reputable.

Building Distinctive Competency

OSI is looking to improve its already developed distinctive competency by actually looking at various options to expand it as discussed in the case. The company is looking to further enhance its distinctive competency by looking to opt for one of the options: expand sales to current customers, get high price from wholesaler, sell direct to retailers or to small restaurants chains and develop a retail brand or enter into export. The above discussed options are available for the company to further enhance its distinctive competency.

SWOT Analysis

Strengths:

The biggest strength of the company has been its vertical integration process where most of the manufacturing aspects are carried within the company. OIS has been strong with its relations with large fast food chains such as McDonalds and Yum. Along with this, the company has been effective in the partnerships with local manufactures that has made the company integrate itself in the local market.

Weaknesses:

The major weakness with OIS has been the lack of skilled and educated labor in the Chinese region. Along with this the market is highly price-sensitive which makes the industry players compete on low margins. The company has also been hampered with poor infrastructure within the region where transfer of goods to other regions is a problem for the company.

Opportunities:

The growth potential in the market is the biggest opportunity not only for OSI but also for other international fast food chains and QSR. Increasing number of educated people in the region and an understanding of foreign products has provided the industry with an opportunity to grow in positive directions.

Threats:

The biggest threat for OSI is the increasing competition in the industry. With more foreign suppliers entering the Chinese market, it is becoming difficult for OSI and other suppliers to quote higher prices. In fact the industry has turned highly price-sensitive. Along with this, the government rules and regulations have affected foreign suppliers as they have to comply with all the requirements of the government unlike local suppliers who are not restricted by the governed rules and regulations.

Functional Strategy of OSI

The company OSI has looked to serve the needs of local market by innovating new products in the market as per the needs and requirements of the local market. They have made specific products for Chinese fast food restaurants to compete with local and other QSRS...................................

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