SM ass 2 - STRATEGIC MANAGEMENT GM 03833 Objectives LIEW...

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STRATEGIC MANAGEMENT LIEW KAI WEN GM 03833 Objectives A) To spot out 15 general external environmental factors and 15 industrial environmental factors which are influencing Malayan Flour Mills Berhad. B) To identify main 5 opportunities and threats to Malayan Flour Mills Berhad from the list. Top 5 Opportunities 1. Less substitution for flour At first, the substitution of world’s largest food crop is very limited. It is the staple food for many civilizations, making the availability of adequate supplies of flour a major economic and political issue. It is the defining ingredient in most foods such as bread, crackers and cake. Substitute for wheat flours such as cornstarch presents serious difficulties in terms of functional properties and also eating qualities. 2. Increasing consumer and industrial consumption of diversified range of flour-based product Annual per capita flour consumption underwent dramatic growth in the final three decades of the twentieth century, contributed to this phenomenon, including the surge in consumption of fast-foods and other flour-based convenience foods such as sandwiches and pizzas. Besides, domestic flour-consumption patterns shifted away from household consumers and toward commercial bakers, including fast-food outlets. 3. Technological advancement, automation, and modernization in manufacturing industry increases the productivity The technology change in machine design and process design are developed downtime, cycle time and setup time of the manufacturing process, which increase the productivity of flour mills. Lower energy requirements, more sophisticated automation, the advent of molecular sieves have cut production costs too. In addition, nowadays various flour-treatment procedures exist to improve the appearance, nutritional content, and baking quality of flour during the milling process. 4. High initial capital investment of the milling plant discourage entry of new competitors High capital costs required to build and operate the plants to build the plant have stop the competitors at the door of the business. The trend also drives a heightened need for companies to invest heavily in technological innovation and modernization schemes aimed at streamlining their larger facilities. This high investment is hardly offset by profits in short period of time due
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