Strategy Execution Plan ROCHO HEALTH PRODUCTS LTD By Sewante M. Kaliphan 17 th August, 2016

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1 Introduction Strategy Execution Plan ROCHO HEALTH PRODUCTS LTD By Sewante M. Kaliphan 17 th August, 2016 Rocho Health Products is a company dealing in the manufacture of natural herbal medicine, natural fruit and root juices and mineral water in a highly and competitive organic health product. Since 2010 Rocho Health Products ltd has grown from one shop in Mbarara district to more than 50 outlets in Uganda, South Sudan, Rwanda and Northern Tanzania and it is one of the most dominant organic health products company in Uganda. Rocho Health products has a variety of products from Mineral water to medicinal fruit and root juices. These are mainly stimulant and anti oxidat drinks that include Lemon Green Tea drink extracted from Organic Fruits, green tea and honey; Vit fruit drink from beetroot, pineapple, hibiscus flowers and honey; Orange tea drink extracted from oranges, pineapples, carrots and honey; and aloe green tea drink extracted from aloevera, green tea and ginseng. These varieties of drinks are extracted from raw materials that come from local farmers who are the main suppliers of the material. The opportunity for Rocho Health Products to produce these drinks stems from the demand from consumers looking form organic products as they mind about health living. With obesity related diseases, respiratory problems and the continued advocacy from the public on the dangers of junk foods, many people are readjusting to green products including organic foods and drinks. Rocho Health Products came in to exploit the situation by providing the market with necessary organic drinks including mineral water and fruit juices. Strategy formulation I have applied the business model canvas in formulating my strategy for Rocho Health Products. This approach offers a focused and transparent lens into the business model based on the founder s concentrated master plan for his firm. This firm came in place to provide a ready

2 market to fruit growers in the community acting as suppliers, provision of fruit organic drinks to replace adulterated and uncertified drinks from the community and provide the alternative to unhealthy sugary soft drinks on the market. With a clear mission of Rocho, the business model canvas offers an easy and flexible method to quickly update and formulate key strategic areas ensuring value within each section. EXHIBIT 1: ROCHO HEALTH PRODUCTS BUSINESS MODEL CANVAS KEY PARTNERSHIPS Farmers Supermarkets Governments Agents Suppliers COST STRUCTURE Salaries R&D Facilities and buildings Manufacturing Distribution Rents REVENUE STREAMS Products sales Sale of by products Consultancy fees from bench markers Sale of organic seeds VALUE PROPOSITION Cost effective and efficient market strategy First vertically integrated fruit industry offering quality organic products Mineral water to medicinal fruit and root juices, Lemon Green Tea drink, Vit fruit drink, Orange tea drink and aloe green tea drink. KEY ACTIVITIES Manufacturing of varieties of drinks extracted from raw materials that come from local farmers who are the main suppliers of the material. Vit fruit drink from beetroot, pineapple, hibiscus flowers and honey; Orange tea drink extracted from oranges, pineapples, carrots and honey; and aloe green tea drink extracted from aloevera, green tea and ginseng. CUSTOMER EXPERIENCE Extreme royalty to Rocho Products Satisfaction related to organic products Delays in delivery Ease of drinking these products CUSTOMER SEGMENTS Mass market Organic drink enthusiasts The elite market for health leaving DISTRIBUTION CHANNELS Retail stores Agents Whole sellers Distributors online CORE PROCESSES AND RESOURCES Manufacturing Sales and marketing Skills enhancement Employment opportunity Social transformation

3 Strategy Analysis In the key activities section of the business model canvas Rocho Products deals in manufacturing Vit fruit drink from beetroot, pineapple, hibiscus flowers and honey; Orange tea drink extracted from oranges, pineapples, carrots and honey; and aloe green tea drink extracted from alo evera, green tea and ginseng. My hypothesis test is to show how the utilization of these fruits enables Rocho to work together with local community suppliers who are in one location that helps Rocho to achieve economies of scale and reduce costs of production. This has accelerated the wide spread adoption of sustainable organic farming and production of organic drinks to the mass market. Core Assumptions Value Assumption- customers will value the convenience and lower costs of production because of access to competitive raw materials within in the location of the factory which has enhanced the performance of Rocho as it overcomes obstacles to production leading to reduces prices unlike competitors. Execution- Rocho will create value at a cost that works by leveraging their organic drinks competitive advantages and through its substantial investment, resources and strategic alliance. Scale- by Rocho working with the farmers and opening up the Rocho technologies among organic farmers, standardization among the industry will occur and fresh fruits will continue to be available, leading to high harvests and cost reductions. Defensibility-given the significant investment and sheer magnitude of the factory, this business is unlikely to be recreated by Rocho competitors. Competitor acceptance of an industry standard will reduce the need compete as well. Testing Hypothesis Value Test- Rocho can create value to customers who value their health, life and status in minding about what they eat or drink. While Rocho sales increased, the mass market acceptance

4 of fruit drinks in general has faced some obstacles by consumers preferring especially energy drinks and other soft drinks especially from big companies like coca cola. Many companies dealing in drinks made from local products like millet are also flooding the market. Rocho has expanded their product range including mineral water with pumpkin seeds. However many other companies are also in same business as Rocho. Execution Test- Rocho can create value and deliver this strategic action by taking advantage of their competitive advantages in organic drinks. When Rocho Health Products opened several clinics of phytotherapy many small scale herbalists opened shop to the extent of imitating the products but of poor quality. The company will acquire financing and go into manufacturing of fruit and root juices and Natural mineral water fortified with Zink from pumpkin seeds. Scale Test- Rocho will be able to create a sustained value to create scale to make this investment worthwhile. By opening up other products it will lead to standardization on the open Rocho specifications industry wide. Local governments and other government agencies will likely enact legislation supporting health and organic products on the market. The result will be new, low cost industry standard around Rocho organic products. If many customers embrace these drinks of Rocho and other companies, then you can have support high volumes and have scale. Rocho expects to increase production of organic health drinks sales tremendously from Shs. 100 million shillings to 1 billion shillings by Rocho Health products ltd will see her fortunes transform from a business portfolio of Shs. 50 million to Shs. 400 millions in four years, thus reducing costs through economies of scale and making Rocho products more affordable to the mass market. Defensibility Test- it s unlikely that competitors will reproduce another organic factory to the level of Rocho. The investiment in this Rocho facility is now roughly at $ 3 million with a plant on 50 acres. The standardization of packaging of these products has also enhanced the appeal for the market. This will create scale as noted above and reduce costs industry wide. There are plenty of unknowns in my hypothesis including changes in consumer behaviors, technological advances and political-legal pressures that could impact my tests.

5 Strategy Implementation The implementation of Rocho s strategy will be examined using the 4A model as depicted in Exhibit 2 below. Kinetic ALIGNMENT AGILITY Potential ABILITY ARCHITECTURE Human Human Resources Aligment- the core purpose of Rocho is improving the health and wellbeing of people and their communities. It s fair to say that Rocho has faced scrutiny for falling short of delivery deadlines in the past. Rocho s stated goal of manufacturing organic products has been achieved with additional lines of products including working closely with the local communities and more especially farmers who are the main suppliers of raw materials and other inputs. In this way, Rocho Products has not only provided ready market for the farm products, but also created employment directly and indirectly to direct staff, farmers, business community and so many other people touched by our business. Ability Rocho s commitment is Building upon our heritage of innovation and quality, together we will improve the health and lives of everyday people and their communities. Interns and specialists are recruited in addition to the talent pool available working tooth and nail to meet Rocho s objectives. The company hires through recruitment agencies in order to have right people doing right tasks at right times. Career development is emphasized and leaders are nurtured and

6 groomed deliberately. Turnover is minimal especially at the top due to favorable employment policies. Agility Rocho is a fast paced company that is adaptive to rapid change. The staff establishment structure is designed to enable employees work in small focused teams that are agile, for effective and efficient performance and Excellency. Architecture Rocho s Strategic architecture is based on available technology on the market for manufacture, bottling, packaging and distribution. Given Rocho s fast paced culture and aggressive strategy, less bureaucracy is better and effective communication, processes and coordination is critical. Conclusion Rocho s mission Building upon our heritage of innovation and quality, together we will improve the health and lives of everyday people and their communities. Established as a small entity to serve small local communities, Rocho Products has grown over the years and emerged quickly as a leader and quality provider of natural herbal medicines, natural fruit and root juices and mineral water. We also work closely with the local communities and more especially famrers who are the main suppliers of raw materials and other inputs. In this way, Rocho has not only provided ready market for the farm products, but also created employment directly and indirectly to direct staff, farmers, business community and so many other people touched by our business. Reference