The firm that is being analyzed is Papa John’s Pizza, which is the third largest pizza chain in The United States and has stores in over 20 other countries. Overall, the company has a very well developed strategic orientation and is heading in a very positive direction. The company’s operational and customer capabilities are very well prepared, however, the Innovation capabilities are still behind their most formidable competitors.
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There is a very high level of consistency in both the company’s operational and structural interior and there remains a great opportunity for this company to expand internationally and domestically, through better use of interactive marketing techniques and expanded product innovations. Information from this study was compiled using statistics from ValueLine. com and various other databases within the UNT website. The performance matrix was utilized to gain a better understanding of Papa John’s current market situation and analyze which direction the company should proceed.
The customer, innovation, and operational capabilities were the major Organizational capabilities assessed. Papa John’s carries a mission statement which focuses on “superior brand loyalty through authentic, superior- quality products, legendary customer service, and extraordinary community service” (Papajohn’s. com). Papa john’s also adopts people as their most important asset to the company and seeks to create long term value for their shareholders.
Papa john’s emphasizes six key values in their operations which include focus, accountability, superiority, attitude, constant improvement, and PAPA (People Are Priority Always). Recently, they have adopted a social policy which places responsibility on their suppliers to auditing their treatment of animals. Papa John’s implements a specific strategic orientation with regards to their product market focus and operational, innovation and customer capabilities. They use only high quality ingredients, hand cut vegetables, premium meats and cheeses and all natural sauces to differentiate from their competitors.
Papa john’s also keeps volatile cost of key ingredients low through partnering with purchasing companies such as BIBP, which is a large chees purchasing company. Papa john’s also operates their own commissaries, which distribute all of the ingredients and supplies to every store. This helps the company keep costs low and ensure the delivery of quality ingredients. The company also uses a strong and continuous employee training program to ensure consistent quality of menu items throughout each and every store.
Papa John’s innovation capabilities seem to a bit lacking. Online ordering is prevalent and the presence of smart phone apps and rewards programs are available, however, the company does not use much business to customer marketing and there are very little signs of using social media devices and marketing tools to connect with their customers. The operating performance of Papa John’s is on a steady gain. The company is currently the world’s third largest pizza company. Pizza hut, a subsidiary of YUM! Brands and Dominos are the frontrunners.
Papa John’s had also been rated #1 in customer satisfaction eleven out of the last thirteen years, which aligns with their mission of people being their most important asset (ASCI). In terms of profitability, Papa John’s have an average net profit margin of 4. 3% and is estimated to increase to around 5. 4% by 2016 (Value Line). The company looks to step up their efforts in the international market in the near future as well, with increased operations in overseas countries. Value Line also recognizes Papa Johns as an A grade on the company’s financial strength.
The company has a little ground work to do in the area of market performance, as both Dominos and Pizza Hut still possess the lion’s share of the market. The organizational health of the firm is very stable at this time. The financial and operational structure are pretty sound and the company’s goals seem to be heading in alignment with the shareholders. Papa John’s has an earnings predictability grade of 95 on Valueline. com, which suggests that the company is on track to increase revenues and generate profits in the years to come.
The performance matrix of Papa John’s concludes that the company is of high importance in the current market and delivers a high amount of performance within the market as well. This would indicate that it is imperative for the company to continue to improve in areas which can gain market share. It is important for the firm to focus on international expansion as well as focus on creating more domestic stores in order to obtain this goal. It may even be beneficial for the company to establish international commissaries to provide the same quality products on a global scale.
Another suggestion would be for the firm to create a more interactive marketing campaign to better engage with their customers and build better brand loyalty. Papa John’s could also develop more product innovations in order to attract more potential customers and further company growth. Overall, the current direction the firm is headed will sustain minimal growth at the pace it is going. The need for change is not completely urgent, however, it is necessary in order to keep its place as one of the industry’s top pizza companies.