Patagonia Case Assignment
Patagonia Case Assignment MSOD 617 Louise Keefe, Ron Milam & Laura Woodward September 23, 2013
Patagonia Case Assignment Patagonia’s “futuring” capability Based on the case study provided, Patagonia is more values based than future based. They are less concerned about specific future scenarios and more focused on a values-based approach to their business, focused on sustainability. “SMO’s (Sustainable Managed Organizations) need to look at short-, medium, and longterm business horizon, and there is a specific purpose for each. The long-term view considers possible future strategic intents and the operating assumptions that will drive them whereas ...view middle of the document...
Patagonia Case Assignment “Scenario planning is the best method for considering possible future situations, exposing changing business assumptions, and developing a cadre of options to draw on in the future.” (Lawler & Worley, Ch. 5, 2011, page 114/449-ibooks). Patagonia didn’t do much scenario planning. Rather, they did a present-focused full cost accounting for their products to help them prioritize the most sustainable option. In general, it appears that when Patagonia needs to consider any term strategy, the focus returns squarely to their values. This case study does not present much evidence to confirm that Patagonia has the necessary effort, focus, or elements for effective “futuring”. In our opinion they do not present futuring well.
Patagonia Case Assignment
Patagonia’s Organization Design Strategy Patagonia has made a conscious and consistent decision to focus on a niche market targeted at their core users, which they call “dirtbags,” described as people “who appreciate athletic endeavor for its own sake.” They aren’t concerned about the voices of all potential customers, just that of their core users and design product specifically for that target market. Their overall strategy is to develop high quality products that are aesthetic, respective of the environment and command prices that are 20% above their competitors. They have divided their product lines into eight target areas; Alpine and Sportswear, being the two largest lines, followed by Capilene®, Luggage/hardgoods, Endurance, Kids, Accessories and Fishing. They make classic products across all lines versus chasing the latest trends. While making high quality products is a key priority they have made a consistent effort to minimize the impact they are having on the environment; “best-quality stuff with the least amount of harm to the environment” (Reinhardt, 2004). They have successfully built a brand without a lot of “marketing.” “Building a brand is not about marketing. It’s about having authenticity” (Reinhardt, 2004). They focus on building their brand by having a balance between product quality, environment, community (social) and financial. The company’s core values are “commitment to the soul of the sport, to an uncommon culture, to environmental activism and to clean design.” Their strategy supports and aligns these core values.
Patagonia Case Assignment Structure Patagonia is a relatively small company, with approximately 1,000 employees with a functional organization structured at the top. This allows them to leverage technology and information across their product lines and customer base. At the second level in the organization, the EVP has his structure by distribution channels. Their strategy is consistent across the product lines making this overall structure appropriate. While they have defined their eight product lines, they have not structured the organization by product line at the top. However, they have identified team leaders...