This paper analyzes the alignment of organizational components with the mission and strategy of Kraft Foods, a major North American food and beverage manufacturer. The paper examines the company's shift to a divisional structure following a 2012 demerger, the development of planning analyst teams as strategic controls, R&D investment as a human resource priority, and the cultural transformation through a philosophy known as "positive discontent." Together, these components are evaluated against Kraft's stated mission of being the best food and beverage company in North America, generating products consumers love, and delivering superior returns to investors. The paper concludes that strong alignment exists but recommends additional innovation-support strategies such as innovation workshops and scenario planning based on consumer forecasts.
The paper demonstrates organizational fit analysis — systematically examining whether discrete organizational components (structure, controls, HR, culture) support a firm's stated mission and strategy. This technique, associated with writers such as Mintzberg, involves treating the organization as an integrated system in which each element should reinforce the others. The paper applies this framework clearly by returning to the mission statement as the evaluative benchmark in each section.
The paper opens with an executive-style abstract paragraph before the introduction, then proceeds through four component-focused body sections (organizational design, strategic controls, HR, culture). A dedicated alignment section synthesizes the component analysis against the mission, and a brief conclusion reiterates the key finding and recommendation. This structure mirrors a standard organizational analysis report and is well-suited to undergraduate business writing.
Kraft Foods is a major U.S. food manufacturer known for many well-recognized brands, such as Jell-O, A1, Philadelphia, Planters, and Maxwell House. Most of these brands hold a leading or second-place position in their respective markets, and 98% of U.S. households have at least one Kraft Foods product in their home (Kraft Foods, 2014). The company — described by CEO Tony Vernon as made in 1903 and remade in 2012 — has changed significantly over the last several years. The company's mission statement is to be "North America's best food and beverage company, and we'll get there by continuing to offer products consumers love, creating a performance-based culture that motivates and excites employees and becoming the best investment in the industry" (Kraft Foods, 2014).
These aims reflect the organization's performance goals in relation to both consumers and shareholders. In order to deliver the superior performance demanded by this mission, the organizational components need to be aligned with the strategy used to achieve those goals. This paper examines Kraft Foods' organizational components, assessing the alignment of its organizational design and structure, strategic controls, human resource focus, and organizational culture with the company's goals. The significant changes undertaken since 2011 to improve performance may be hypothesized as placing the company in a strong position, facilitating alignment between operations and strategy through careful management of its various organizational components.
An organization is greater than the sum of its parts; when the various components are aligned to organizational goals, the potential for those goals to be achieved increases exponentially (Mintzberg et al., 2011). Components may include the organizational structure or design, operational focus, and strategic controls.
Kraft Foods has undergone significant change over the last few years. In 2012, a major demerger occurred that impacted the organization's structure, making it considerably smaller. However, the increased focus that resulted — with Kraft Foods concentrating on North American grocery products — was followed by further structural refinement in 2013 (Retail Marketing, 2013). The company has since shifted toward a more divisional structure, where divisions operate as autonomous business units organized by product type. The most recent change was the division of the grocery division into two smaller units: meals and desserts, and enhancers and snack products (Retailing Today, 2013).
Where natural synergies exist between products — such as Jell-O and Cool Whip — they remain together. Other product categories that had been separated in the past have been recombined; for example, Planters snacks and peanut butter have been brought back together (Retail Marketing, 2013). This divisional structure may be seen as intelligently designed, linking similar and complementary products, capitalizing on synergies, while empowering each division to focus on only a small number of brands. The firm is diversified, and this less centralized approach to brand management has the potential to create value through increased focus and managerial empowerment. Increased empowerment is associated with higher motivation and productivity, and also creates a greater scope for innovation (Buchanan & Huczynski, 2010).
The firm has developed a number of strategic controls. The key elements of the firm's strategy have been distilled into a four-part plan: to make people the firm's competitive edge, to execute with excellence, to turbocharge iconic brands, and to redefine efficiency (Kraft Foods, 2014).
A central feature of this strategy has been the development of planning analyst teams composed of the firm's accountants. These teams assess new products, evaluate the cost of launches, and determine whether new products can be produced within budgetary limits. Planning analysts work in alignment with the firm's goals to determine whether new products will be able to meet financial targets (Kraft Foods, 2014).
The quality of inputs is controlled through the use of a predetermined list of approved suppliers. Food inputs for Kraft come from only 23 suppliers, which facilitates control over the supply chain and enables the development of strong supplier relationships. This also allows for careful cost and quality management through the use of very specific contracts (Kraft Foods, 2014). These measures are all clearly aligned with the desire to increase value and generate high returns through disciplined financial management.
Kraft Foods has faced significant challenges in the past, including a lack of genuine innovation and strategic focus. The current divisional structure is helping to overcome these challenges by increasing the attention paid to individual brands. Empowering divisional managers to make decisions may also help achieve operational goals by increasing motivation and associated productivity, while enabling those closest to operations to exercise greater judgment. Overall, there is a strong alignment between the firm's organizational components and its mission and strategy. However, room for improvement remains — particularly with respect to accelerating the pace and depth of innovation through the adoption of additional supporting strategies.
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