Domino's Case Study
...’s did not sufficiently invest in enough travel, communication, and time to build relationships and gain expertise in the local markets and cultures they wished to penetrate. For example, the firm attempted to establish its pizzerias in markets that were comprised of cultures that were either unaccustomed to eating pizza or the convenience of home delivery. A cause of the concerns for the safety of Domino’s delivery men and other motorists may have stemmed from a number of accidents that transpired as a result of this pressing urgency to deliver Domino’s pizza in 30 minutes or less. Although the organization did not intend their policy to endanger the lives of employees and other motorists, delivery men almost certainly resorted to running red lights, driving through stop signs and weaving recklessly in and out of traffic for fear that they would lose their job positions if they had not delivered the pizzas in time. IV. Solution(s): One solution to the first identified problem concerning the company’s need to differentiate its pizza from its competitors was Monaghan’s development of the strategy of delivering a hot pizza pie to customers in 30 minutes or less. In order to successfully implement this strategy, Monaghan chose to locate his earliest franchises in college towns and in close proximity to military bases. Aside from this strategy, Domino’s developed a number of other solutions that helped the company to achieve a competitive advantage over competing pizza brands and makers. Such solutions included Monaghan’s development of the corrugated pizza box and the insulated delivery bag that prevented heat from escaping the pizza boxes and preserved the freshness of pies. As for the organization’s second problem concerning global expansion, Domino’s must realize the importance of adapting to the local markets and cultures of overseas countries. For example, instead of standardizing its pizza toppings across the board, Domino’s should adapt to the tastes of local markets by offering a specific array of toppings that would appeal individually to each local market and culture. In order to succeed in a global dimension, the company should demonstrate a better respect for market diversity by customizing its food products and advertising as much as possible to match the local needs of different regions. To solve the problem of concern for the safety of Domino’s delivery men and other motorists, Domino’s discontinued the “30-minute guarantee” and replaced it with the “total satisfaction guarantee” as follows: “If for any reason you are dissatisfied with your Domino’s pizza dining experience, we will re-make your pizza or refund your money.” Once Domino’s expanded into communities other than college towns and those near military bases, Monaghan should have anticipated the impossibility of maintaining the company’s 30-minute guarantee. By placing greater emphasis on product quality rather than on punctuality of its product deliveries, Domino’s assures customers of the freshness of its pizza pies above the inevitability of such delivery impediments as traffic delays. V. Recommendations and Justification: The strategies that Monaghan developed in order to solve Domino’s problem of differentiating its pizza from those of its competitors were appropriate in that they succeeded in making Domino’s pizza clearly distinguishable from its competitors in the pizza making industry. Before the creation of the Domino’s franchise, pizza consumers were never promised a pizza delivery in 30 minutes or less. This policy, along with Monaghan’s development of the corrugated pizza box and insulated delivery bag, set a tremendous precedent for all of its competitors to follow and made pizza delivery what it is today. Secondly, the actions recommended for solving Domino’s initial problem with expansion into global markets are appropriate because they directly address the causes of this problem. In order to attain success in the global marketplace, a firm must possess considerable knowledge of those foreign markets it wishes to enter. By developing sensitivity towards market diversity and gaining a better understanding of cultural differences, Domino’s can improve its effectiveness in appealing to consumers across a myriad of cultures. Lastly, the solution I discussed with regard to Domino’s 30-minute guarantee is appropriate in that it helps to eliminate the concerns of consumers’ for traffic safety. By adopting the “total satisfaction guarantee,” Domino’s alleviates the pressure experienced by its employees to rush through traffic in order to meet the company’s 30-minute or less delivery promise. Without the existence of this pressure on employees, the inclination to speed would no longer exist and traffic accidents/violations would be significantly reduced. Also, this new policy diverts the concerns of consumers from traffic safety and the punctuality of pizza deliveries to product quality and the satisfaction promised by Domino’s entire dining experience. VI. Review Questions: 1. Tom Monaghan was able to develop Domino’s into a world-wide enterprise for a number of reasons. For one, he possessed the internal locus of control of most every entrepreneur in that he believed he was in control of his own destiny and knew that someday he would succeed in a big way despite the hardships of growing up in orphanages. Secondly, Monaghan exerted extraordinary amounts of energy into the achievement of his goals, never once lacking passion, persistence or the drive to work exceptionally hard. 2. I think Tom Mon...