Strategic Plan for Oporto: Addressing Key Issues (MGMT19128)

This report presents a comprehensive strategic plan for Oporto, an Australian fast-food restaurant. It begins with an executive summary and an introduction to the company, followed by an external audit using Porter's Five Forces and an analysis of key success factors. An internal audit, employing value chain analysis and an examination of core competencies and capabilities, is then conducted. The report identifies two key strategic issues: changing social trends and a focus on customer service. A strategic plan is developed to address these issues, including financial plans and action plans to adapt to changing consumer preferences and enhance customer experience. The plan focuses on menu modifications, marketing strategies, and operational improvements to ensure Oporto's continued success in the competitive fast-food industry. The report adheres to APA referencing style and includes relevant theoretical and empirical research to support its findings.

Strategy and Change

STRATEGY AND CHANGE 1
Executive Summary
The main objective of this report is to understand the procedure of strategic concept of
the company. In this report, the strategic actions are developed by analysing the strategic
issues of the organisation. Oporto has been taken into consideration to evaluate the strategic
issues. Porter’s five forces, value chain analysis, core competences and capabilities are the
tools which are used to analyse the strategic issue of the restaurants. As per the porter’s five
forces analysis, it is observed that the market is profitable due to which the company will
grow easily. The strategic issue of the restaurants are social trends, and the competitive
environment. At the end, the strategic plan has been developed to resolve the strategic issues
of the restaurants.

STRATEGY AND CHANGE 2
Contents
Introduction................................................................................................................................3
External Audit............................................................................................................................3
Porter’s Five Forces................................................................................................................3
Key Success Factor of Oporto................................................................................................5
Internal Audit Value Chain Analysis.........................................................................................6
Value chain analysis of Oporto..............................................................................................6
Core competencies and capabilities........................................................................................8
Two Strategic Issues..................................................................................................................8
Strategic Plan.............................................................................................................................9
More on this Strategic Plan...............................................................................................10
More Strategic Plan..........................................................................................................10
References................................................................................................................................13

STRATEGY AND CHANGE 3
Introduction
Strategic Change is the procedure of reconstructing the business of an organisation
with the marketing plan with the motive to achieve the objective. The strategic change
includes the target market, mission and the organisational structure (Ansoff, Kipley, Lewis,
Helm-Stevens, & Ansoff, 2018). It is required for the organisation to analyse the internal and
external factors that affect the organisation. In this report, the discussion is made on the
internal and external analysis of the company. Oporto’s has been taken into consideration to
evaluate the factors that affect the growth of an organisation.
In the beginning of the report, the external factors will be analysed with the help of
strategic tools such as porter’s five forces and key success factor. After that, the value chain
strategic tool is used to analyse the internal resources and capabilities of the company. Two
strategic issues of the company will also be analysed in order to develop the strategic plan.
Overview of the organisation
Oporto is an Australian fast food restaurant with a Portuguese theme. It was
established in the year 1986 as a franchise. The restaurant delivers the chicken, Portuguese
style and burgers. The restaurant operates under the food industry in order to deliver the
services to consumer. The menu card of the restaurant contains the items such as burgers,
wraps, chicken products, salads, sides and desserts. The company served the 10.2 M Bondi
Burgers in a year to the consumers with the help of the people who have the spirit of
adventure. It has 160+ casas around the world and growing (Oporto, 2018a).

STRATEGY AND CHANGE 4
External Audit
Porter’s Five Forces
Competitive rivalry among competitors:
Oporto restaurant has to face the major competition with McDonald’s, Pizza Hut and
KFC. Due to the increase in demand of fast food, numbers of restaurants are also increasing
that put threat on the firms to innovate more (Coelho, 2017). Therefore, Oporto also has to
face the high competition from these competitive restaurants. Other than these competitors, it
also has to face the competition from local restaurants, coffee shop, fast food store, as well as
street vendors.
Bargaining power of buyers:
Consumers tend to affect the performance and quick service of Burger King. Due to
the low switching cost, Oporto has the high bargaining power of buyers (Consumer Affairs,
2018). In addition to this, customers also have man other choice that presents the substitute
for buyers. Therefore, it is required by Oporto to always consider the need of customers and
bring innovative ideas.
Bargaining power of suppliers:
Suppliers tend to affect the quick service restaurant environment through variables
such as supply control and pricing. Several suppliers also compete in order to provide their
products to the firms. Besides this, most of the suppliers in this industry also have low
forward integration that tends to corresponds to the sale of product as well as degree of
control on the distribution (Noe, Hollenbeck, Gerhart, & Wright, 2017).
Threat of substitute-

STRATEGY AND CHANGE 5
This aspect of the five forces analysis determines the level of influence in the fast
food industry. It is true that due to presence of several competitors, it is easy for customers to
easily transfer from the Oporto to any other substitute. Besides this, several substitutes are
also available such as home cooking and fine dining restaurants. Most of these substitutes
also strengthen the threat of substitute against the Oporto. In addition, many of the substitutes
is also satisfactory in terms of cost, taste, quality as well as other criteria (Wheelen, Hunger,
Hoffman, & Bamford, 2017).
It is concluded that the company has the high risk of competitors that would become
the obstacle in achieving the success. It is difficult to influence the consumer towards its
services as there are many companies that provide the similar services due to which the
bargaining power of buyers is increases. The market is profitable for the restaurant as there is
high demand of consumer towards it.
Key Success Factor of Oporto
 Better quality food and effective location: Oporto is successful due to ist key location
that helps it in attracting large number of shoppers as well as tourists around. Besides
this, people always love to have the meal with their fast food restaurants. It also offers
the wide variety of snacks, burgers, salads, and grilled chicken. Sauces are also the
key distinct part that it tends to offer with the food. In addition to this, it is also seen
that the staff of Oporto is quite friendly and loyal to the company. This helps it in
getting successful by the passage of time. Due to this, it has followed the concept to
offer the grilled food not fried.
 Innovation- It is the essential part of any organisation. Oporto is also getting huge
success due to its global standard for the quality foe meal. It also uses standardized
operations that help it in ensuring the quick processing as well as service the recipes

STRATEGY AND CHANGE 6
on time. In spite of huge competition in the fast food sector, it is getting success by
including the innovative ideas (Ferreira, Marques, & Guerra, 2017).
 Effective research and development- In the recent time, it is essential for the
companies to do the research and development in an effective manner. Therefore,
Oporto has also conducted the research due to which it has decided to bring the new
stores design with full of amazing food, positivity as well as to suit the needs of
millennial. In addition to this, it has also opened the brand new store in the “New
South Wales.” It is getting the positive feedback due to this. It is effectively working
in the Oporto and included in its success factor.
Internal Audit Value Chain Analysis
Value chain analysis of Oporto
It is a strategic framework to analyze the differentiation of competencies of the
company considering the primary and secondary activities (Hishe, Asfaw, & Giday, 2016).
The primary activities of Oporto that would be result in differentiation or competent for the
company are
1. Inbound logistics
 Damage reduction activities in the process of procurement are another element that
the company controls to minimize its expenses.
 Reduction of transportation cost, to keep the expenses low and increase the profit
margins
2. Operations
 Enhanced product presentation to attract customers
 Prevention of premature failure is a key operating activity

STRATEGY AND CHANGE 7
 Product variety maintenance is another key operations (Hishe, Asfaw, & Giday,
2016).
3. Outbound logistics
 Order processing procedure are the key outbound activities
 Reduction of product damage through effective material handling and logistics
(Mudambi, & Puck, 2016).
4. Marketing and sales
 Enhanced customer relations
 Effective communication through promotional activities
 Key sale promotion activities (Lasserre, 2017).
5. Services
 Outlet experience
 Technical assistance
 Service maintenance
Secondary value chain activities of Oporto
6. Firm infrastructure
 Advanced information system
 Fast food outlets design and location strategy
7. Human resource management
 Training and development programs to increase the customer services at the outlets
for increased customer satisfaction

STRATEGY AND CHANGE 8
 Recognition and rewarding programs to retain maximum employees
 Incentive plan to promote sales of Oporto (Oporto, 2019b).
8. Technological development
 Innovative product development
 Total quality management system
9. Procurement
 The key strategy of the company is to provide high quality products, for which the
major consideration of Oporto is the procurement of high quality raw materials. The
company key products are burger and chicken, which need to be of high quality to
retain customer and abide by food and safety laws of Australia.
 Agile supplier’s relations, to reduce the bargaining power of supplier and reduce the
risk of unavailability of raw material on time
Therefore, from the value chain analysis of Oporto it can be concluded that the primary and
secondary activities of the Oporto that could be aligned to the differentiation strategy of Oporto
included outbound logistics, inbound logistics, marketing and sales, operations, and services as
primary activities. Secondary activities included technological development, human resource
management, firm infrastructure, and procurement.
Core competencies and capabilities
Low cost pricing strategy:
The major capability of the Oporto is its low pricing strategy that it used in
developing many outlets in busy areas of the city such as colleges, big markets and office
premises (Gebauer, Saul, Haldimann, & Gustafsson, 2017). In addition to this, it also offers
the different taste as well as established the customer base effectively. In spite of well-

STRATEGY AND CHANGE 9
recognised brand, it charges very less prices from the customers. It has also embraced the fast
food that fits well with the life style of younger generation people.
Variety of Burgers
It has been seen that the restaurant provides the variety of burgers. Different types of
burgers are the main core competence of the restaurant due to which the consumers are
attracted towards it. The restaurant gains the competitive advantage by delivering the variety
of burgers.
Two Strategic Issues
The companies in today’s scenario are focusing more towards the customer service and they
try to enhance the customer experience at the outlets. The rapid change in social trends is one
of the key challenges that the fast food industry would face in the near future in the
Australian market. The health conscious and awareness regarding the health is been
increasing among the customers (Djekic, et. al, 2016).. This could be one of the major
reasons for the company to lose the customers and fails in the market due to competitors. The
key strategic issues that Oporto could face in the near future include
1. Change in social trends
2. Oriented towards customer service
Strategic Plan
Strategic issue 1- Change in social trends

STRATEGY AND CHANGE 10
Objective of plan- is to change the ingredients and recipes as per the consumer trend
Financial plan- It has to raise the funds outside the company
It is required to change the menu of the restaurant in order to convert into the fast
food into the healthy food. The changing perception of consumer towards the healthy food
increases the issue for the restaurant in the coming future. The restaurant has to change the
ingredients to cook the healthy food so that the consumer’s preferences will change in the
favour of restaurant. The action will capitalise by raising the shares from outside the
restaurant and also encourage the investors to invest at the workplace.
The six months plan is made in order to reduce this issue such as:
Change the old menu card and posters
Using advertisement tool to aware people
Action Plan for 12 months for long time success
Hire master chief for baking food
Purchase fresh and quality of food
More on this Strategic Plan
Changing the menu card-
It is required to resolve the issue due to which the company has to develop the menu card.
Before attracting the consumer towards the healthy product, it is required to decide the food
and dishes which is offer by the restaurant to change the perception of consumers toward the
healthy product.

STRATEGY AND CHANGE 11
Advertisement tool-
The restaurant has to use the social media, newspaper and television to influence the people
for their services. It helps the restaurant to gin the long term advantage in the market.
Hire master chief-
The restaurant has to hire the master chief by taking their interviews and demos in cooking
the food. The restaurant has to hire the chief as per the vacancies and changing the menu
card.
Strategic issue 2- Oriented towards customer service
Objective of plan- Provide the quality of Food as compare to companies to gain the
competitive advantage
Financial- The Company influences investors by preparing the financial statement for
investing in the restaurant services
The restaurant has to provide the healthy food with the delicious taste so that the large
number of consumers attracted towards it. The restaurant has to design the infrastructure in a
manner from which the large number of people specially come to visit it. It has to provide the
healthy food with the taste of fast food so that the every age of people attract towards it
(Ginter, Duncan, & Swayne, 2018).