Ben and Jerry’s was an ice cream manufacturing corporation that was started in the year 1977. This was after former school mates, Ben and Jerry, were dissatisfied by their jobs and decided to open an ice cream manufacturing shop. They opened their first shop in Burlington in a $12, 000 investment. The investment was sand immediate success, but the winter period of the year 1980 made them come up with the idea of packing there ice cream in pints due to the low demand of their product, and sell it to retailers.
In 1981, the company was able to sell as much ice cream as they could make. Their annual growth rate was sixty percent, raising need to spread some branches so as to manage the increasing demand of ice cream. Statistics showed that most demanding families had children averaging five years old, or they had old people of over fifty five years.
The corporation produced different types of ice cream which included, super premium, premium, regular and economy. The super premium had a high percentage of fat and low level of air in the making of the product, making it more delicious and highly demanded. Super premium products were packed in round containers but other products were packed in rectangular containers. In the year 1988, Ben and Jerry’s were named U.S. Small Persons of the year, and this was phenomenal to the growth of the corporation.
The corporation thought on how to distribute their super premium products. They used Dreyer’s Grand Ice Cream Inc, and Sut’s Ice cream for distribution. They also used local area distributors, who distributed the products within a limited area. Frusen Gradje and Steve’s were losing their distribution very fast in the year 1990. Their market distribution fell by 15% and the shares points fell by three percent points.
In 1990, Ben and Jerry’s was on the top position nationally in ice cream production, and was in fifth position in ice cream makers of any type. They produced a wide range of flavours including chunky monkey and Cherry Garcia. The corporation’s growth was due to the spread to different geographical locations. It had identified twelve core markets that represented two thirds of the super premium distribution in United States of America.
The other thing that contributed to the rapid growth of Ben and Jerry’s was the invention of new super premium products. In 1990, they made Rain Forest Crunch, Wild Maine Blueberry, Chocolate Fudge Brownie, and Fresh Georgia Peach Light. This step raised their sales by 15% by the end of 1990. This rapid spreading of the corporation imposed new challenges on Ben and Jerry’s. This is because they had to develop innovative market strategies, and improve management enquiries so as to satisfy the rising number of customers.
Ben and Jerry’s saw that there was a need to help the people in the States. This was because Ben had grown social concerns about the society. Ben decided that the market promotion of the firm should be educational and should also cover social issues affecting the society. They supported issues such as family farm issues, and also ban the Bovine Growth Hormone. They also sponsored summer music festivals across the nation. They advocated for world peace, environment and other social issues. These activities developed a great image for Ben and Jerry’s on the process. Ingredient sourcing was also done for social purposes. For example, they bought blueberries from a farm owned by native farm group, so as to raise their life standards. They were also supplied with brownies for their chocolate fudge brownie by a New York bakery owned by homeless people. They did all this with a reason to take care of the less privileged in the society.
In 1985, the company started funding community projects, and organised four hundred companies to form a group called 1% peace. The group intended to rejuvenate world peace, not for profits but for social benefits. Internally, the company decided to be caring, mostly to its employees. Employee training programmes were started, they attended work casually, and also the office meeting were organised as bashes. All the social ideas came from the founder, who said that they were not business minded and did not graduate from college when they started the ice cream parlor in 1977.
This social degree of the company gave it a promotion boost, and increased the morale of the workers because they realised that the founders of the company recognised their efforts. Statistics showed that 52% of the population would pay 10% more for a product from a socially concerned company. The management believed that they had the financial and social issues o tackle, and they were to be long term. They believed that both obligations were intertwined, hence the development of social issues would lead to financial development.
The company was run by the five-to-one rule. This rule meant that the ratio of the salary of the highest paid in the company to the employee who is least paid should be 5:1. This was contrary to the common ninety to one ratio in most of the companies in the United States. This rule motivated the workers even more because of the attention they are receiving from the management group. This philosophy though came with some effects. The employees reduced the urge of getting promotions because even after promotion the salary will not increase much. The jobs in the company were just asked for by the people who were ready to take low salaries. This philosophy led to debate between Chico, who was business minded, and Ben who focussed on the social benefits to everybody. Ben and his followers threatened that if the philosophy was broken, then they would quit. Chico on the other hand wanted the change of the philosophy so as to attract more professionals in the company.
From this case study, there are several important issues that need to be addressed in organisation development. One of the major issues is the concern of the social being of the employees and the consumers. This would increase the organisational development in that more customers can buy from a company that is concerned with the social issues without caring the prices. The other important issue that needs to be addressed is the innovative skills of the organisation. This is evident from our case study because the ideas of new super premium products led to the rapid growth of Ben and Jerry’s company (Werker, 2001).
It is important to also look at the concerns of the employees in an organisation so as to motivate them and get the best out of them. Ben used the 5:1 rule to motivate the workers ad also improve the social style between the workers and then management group. It important to examine the issue of “making maximum profits” in an organisation to enhance development. Ben and Jerry’s used various methods to increase the growth of their company, and also attract the highest number of customers so as to make profits (Werker, 2001).
Several changes can occur in an industry, hence making the organisation to re-evaluate their strategies. One of these changes is the level of security in a place. This factor can cause decrease I the number of customers, hence forcing the organisation to change their strategies and take care of security also. Seasons that the products are less demanded can cause an organisation to change their strategies. From our case study, we see that in the year 1980, it was cold and the demand for ice cream, so they changed their strategy and started storing their super premium products in pints and distributing to retailers (Van Knippenberg, 2000).
An organisational philosophy can have some aspects that are a challenge to incorporate short term, small scale and long term changes. One of the aspects is, if the philosophy is one-sided. A philosophy can be favouring the management or the employees only (Hendry, Jones, & Cooper, 1994).This can be a challenge because one of the bodies will become dormant due to lack of motivation. This can cause a decline in the productivity of an organisation. The other aspect that can be a challenge in an organisation is if the philosophy does not look at the wants of the customers. If the philosophy does not look at the customers but only focuses at profit making only by the organisation, can be a challenge because it will push away the customers. This affects the short term and long term changes of the organisation, and needs changes so as to clear the aspects (Van Knippenberg, 2000).
If an, organisation does not make changes in strategy to a highly competitive industry can make the organisation lose their customers to a competitor. This is because the competitors will be inventing new methods to attract maximum number of customers. Lack of changing strategies in a fast changing and competitive industry can make an organisation incur huge losses and also a decline in their shares percentage (Timperley, 1980).
The most effective strategy that could help this organisation achieve its goals would be introducing rewards to the most effective employees in the company, and still contributing to social issues in the society. This strategy can motivate every employee to put his maximum efforts, and still attract a huge number of customers from their social activities(Hendry, Jones, & Cooper, 1994).
The organisation cannot still maintain its values while still going through the change of management processes. This is because the organisation will change the social rule, but only the management issue on the five to one philosophy. The organisation’s value was cemented by their social concern and also the payment rule they introduced. Changes in the management processes would mess up with all the activities they were carrying out in the society, and also ruin the social bond and the morale of its employees who had been motivated by the changes in the difference in payment between the highest paid, and the least paid employee (Hendry, Jones, & Cooper, 1994).
Cohen needs to step down and leave the leadership to somebody else so as o enhance changes in strategy in the organisation. His philosophy worked, but the industry is changing and needs change in strategies so as to cope with the highly competitive market. Without change in the strategies can led the organisation to being overtaken by their competitors and that would lead to collapse of the organisation.
Some of the cultures that need change in the organisation would be the 5:1 philosophy, and the marketing strategies. The 5:1 philosophy has to be changed so as to attract more professionals and also and motivate the workers to work harder for a promotion which will be better paying due to the changes in the payment ration. This step will make the organisation more productive, and cope with the competitive industry (Timperley, 1980).
Van Knippenberg, D. (2000). Work motivation and performance: A social identity perspective. Applied psychology, 49(3), 357-371.
Timperley, S. R. (1980). Organisation strategies and industrial relations. Industrial Relations Journal, 11(5), 38-45.
Werker, C. (2001). Knowledge and organisation strategies in innovation systems. International Journal of Innovation Management, 5(01), 105-127.
Hendry, C., Jones, A. M., & Cooper, N. (1994). Creating a Learning Organisation: Strategies for Change. Man-Made Fibres Industry Training Organisation.
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