Consulting Playbook: Prepare a merger of equals with the customer in mind
The Consulting Playbook, Edition #16
When two Global Companies in the Food Services industry started planning a merger, they needed the help of a Consultant to design the new operating model of the new company.
The objectives were rather clear, economies of scale, better geographic coverage and access to new distribution channels.
However, one of the key concerns expressed by the management was the risk of losing focus during the transition of the two separate companies to an integrated one. Both companies were facing extreme competition in their respective areas and the merger could become a major distraction if not managed properly.
The main aspects the Consultant needed to offer expertise were alignment of the two companies’ different governing structure and practices, agreement on the new business model and on series of different issues. Their strategic priorities had to be coordinated too.
5 Steps to Align the Company’s Focal Points
- Valuable input was gathered from the two CEOs and the rest of the executive team on the new operating model and the corporate center design. Would the corporate center act as a financial holding or rather be involved on the day-to-day operations? The company opted for a light corporate center providing strategic guidance and created a shared service center to optimize all transactional activities.
- A detailed analysis of the two companies’ current state of operation was performed, to facilitate the new company’s launch and provide more insight for the transition and ensure a quick alignment with the refreshed group’s strategy.
- Each corporate department of the new company was designed in group sessions that included a broad participation of executives and team members. Input by the groups on the two companies’ subsidiaries was gathered.
- Top management worked on alignment of relocation efforts as many corporate centers were being rationalized at headquarter but also regional level.
- Last, a transition team led by one of the two CEOs was created to manage day-to-day operations while the other CEO took the lead of the Integration effort.
A New Operating Model Leads the Way for a New Vision
The project was successfully completed with the adoption of a detailed new operating model. This helped the newly established entity to articulate the new corporate vision and to effectively manage new priorities as well as the balance of power between the manager of the two legacies.
Company’s mission statement was created with strategic alignment between all departments and roadshows were organized all over the world to communicate the vision and embark the teams.
The new management tone was defined, and the merger was successfully implemented.
Major Food Service Trends Shaping the Industry
From fine dining to food trucks this year we are seeing some interesting and significant trends. Usually new trends start at the top, with the top level dining and find their way into the lower levels of food service infrastructure. There is plenty of innovation and progressive trends to talk about affecting today’s food service industry. From Fast-casual, Fast-fine to Fast-casual 2.0 establishments prove they are more innovative and ground breaking than Fine dining.
Main factors that are affecting the food industry lately, as expected, are technology and mobile apps, commodity prices variations, as traditional food services become more open and more dynamic.
The revolutionary aspects we are noticing are personalization, authenticity and brand new food and drink concepts developing in pace with consumers’ tastes.
Companies need to understand better what motivates consumers and what are they looking for when it comes to food and dining.
Top Three Consumer Trends Today Include
- Mobility and Flexibility
Consumers want their food anywhere and anytime. Hot food bar, delis, sushi bars, salad bars, etc., are being offered in a variety of outlets from Fast-casual 2.0 and Upmarket casual to Grocery stores, plus there is various meal subscription services, meal delivery businesses, and more. This is creating additional competition for traditional restaurant operators, and they must adequately respond to. Keep innovating and attracting more customers, these outlets need to try hard to retain them too.
- Extreme Choices in Food and Eating Styles
Some people are devotedly counting calories and looking for lower fat, fat-free, sugar-free types of foods, with the clear goal to lose weight and stay in shape. While others like to indulge, and eat anything and everything they like from solid and elaborate main courses to rich desserts and sweets, burgers, pizza, pasta and more. Customers just have a range of preferences. And they like to have choices readily available to them, whether they like to indulge or stay healthy and slim.
- New Sources of Protein
Consumers are very concerned with protein, and where they get their proteins from. New alternative sources of protein are sought after like quinoa, beans, cauliflower, poultry, fish, etc., beside the popular options like steaks and burgers.
A smart strategy for restaurants will be to offer a bigger variety of traditional and contemporary proteins to satisfy customers’ evolving tastes.
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About The Consulting Playbook
The Consulting Playbook is a collection of posts designed to offer insights into how businesses and their executives can utilize consulting as a strategic lever to boost performance. Each Consulting Playbook post is broken down into a few elements: Case Study, Additional Information regarding the technical application, and Additional Links related to the topic.