ACCT10143 Case Study: Key West Key Lime Pie Strategy Analysis

This case study analyzes the Key West Key Lime Pie company's strategic direction following a store redesign. The assignment focuses on determining the type of strategy adopted (cost leadership or differentiation) and provides a thorough justification for the answer, considering personnel, resources, and activities. The analysis concludes that a differentiation strategy is the most suitable approach for Key West Lime Pie, allowing the firm to offer a superior product and increase profitability. The assignment also highlights the influence of the new management accounting system on employee behavior, emphasizing directional and motivational influences to drive employee success. The new management's changes, including employee compensation, consultation, and open kitchen, are discussed as key strategies for differentiation, making the firm unique and attractive to customers. The analysis references changes in product, service, distribution, relationships, prices, and image.

ACCT10141
Accounting, Behaviour, and Organisations
Key West Key Lime Pie
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ACCT10142
CASE STUDY: KEY WEST KEY LIME PIE
1. What type of strategy (cost leadership/differentiation) does Key Lime Pie take
after the redesign of the store? Discuss in terms of personnel, resources and activities
performed. Provide a thorough analysis to justify your answer.
After an analysis of the Key Lime Pie case, the best strategy that the firm should take is a
complete differentiation. In as much as cost leadership is a key strategy in pushing a firm to the
top position, it needs a well-established firm with large annual revenue. Notably, before the
change brought in to the company by Marcus Lemonis, the firm operated a large capital of
approximately$1.4million with large debts and poor employee management. This, therefore,
means that even with the capital injection done by Marcus the new CEO, the firm cannot adopt a
cost leadership strategy as it needs to stabilize in the first place.
Differentiation as a key strategy is the best cause of strategic action that Key West Lime
Pie can take after the change as it will allow the firms to provide a superior product (Pie)
compared to other firms in the same industry. More so, differentiation is key in the provision of
high-end value to a firm's customers at an affordable cost (Cattani, Dunbar and Shapira 2017).
The strategy is also suitable as it provides a firm with the means to raise general profitability as
well as business long term viability which is a win-win situation needed by the owners of the
firm together with the employees. According to the new CEO, Key West Lime Pie needs a
completely new way of doing things as the old methods failed to work and earn the firm a good
profit margin. Therefore, the best way to attain this is to come up with a strategy that can
completely influence the behavior of everybody within the firm. The adopted strategy must be
able to provide direction and offer motivation to employees and owners.

ACCT10143
Evidently from the changes needed within the firm in terms of operation, management,
resource utilization, and distribution, can only be achieved through a complete differentiation.
The firm should, therefore, differentiate all its six components to be viable with the new changes.
The firm needs to proceed with the differentiation in terms of products as changed, differentiate
its servicing process, channels of distribution, relationships, prices, and image.
The new CEO Marcus Limonis has brought great change to the organization and made it
unique, the management of the firm has been changed, service provision, as well as relationships
between the management and the employees as well as the between the business and the
customers, have changed. To this effect, the firm must sustain these changes and remain
completely different from other firms. This is because by remaining unique compared to other
firms, Key West Lime Pie will be able to attract more customers with its fresh and unique pie
recipes. More bringing the kitchen front is another keys strategy creating a new relationship with
customers. The new management has also set a new mechanism of employee compensation and
consultation where they believe that their opinion matter and that they are key members of the
firms. As one can note, everything works due to unique changes brought in to the business by
Marcus Limonis and the best way to keep thing as unique as there are is to adopt a differentiation
strategy.

ACCT10144
References
Cattani, G., Dunbar, R.L. and Shapira, Z., 2017. How commitment to craftsmanship leads to
unique value: Steinway & Sons’ differentiation strategy. Strategy Science, 2(1), pp.13-38.