Baskin-Robbins

Baskin-Robbins

Baskin-Robbins (DNKN) is a global chain of shops specialized in ice cream production and sales. Its headquarters are in Canton, Massachusetts. Irv Robbins founded the company in the year 1945 in Glendale, California. The firm is famous for its ‘31 flavors’ tag implying that loyal customers can taste a different ice cream flavor at any given day of the month. The founders believed that people should have a wide variety of flavors for sampling. This way they are able to make an appropriate choice. Since 1945, the firm has introduced more than a thousand ice cream flavors.

There are more than 7,300 Baskin-Robbins shops spread across the globe. Outside the United States, the shops operate in more than 50 countries including Japan, Ukraine, England, and Nepal. Other countries that Baskin-Robbins has a major presence include China, Portugal Italy, and Malaysia. Recently, the firm opened its shops in developing countries like Dominican Republic, Mauritius, Honduras, Egypt and Kazakhstan.

Baskin-Robbins produces different flavors of ice cream with specialties in cups and cones, Sundaes, Parfaits, and Beverages. Besides, the firm bakes and sells cakes for different occasions. The customers can order the products online because the firm provides delivery as an after-sale service.

History of Baskin-Robbins

Baskin and Robbins are brothers-in-law that merged their respective parlors--Snowbird Ice Cream and Burton’s Ice Cream Shop--to form the global firm. The merging happened in 1945 in California (Fucini et al., 72). Prior to the merging of the two firms, Snowbird offered 21 flavors while Burton’s had 10 flavors. Today, the Business entity is arguably a world leader in ice cream specialty with the longest chain of stores. There are approximately 4,800 stores distributed globally as of May 2015.

In 1967, United Brands Company (UBC) acquired Baskin-Robbins. IPOs were released during late 1972 with a historic debut of 17% IPO sale. Subsequently, J. Lyons Company from Britain acquired Baskin-Robbins from UBC including all public stock. It was then that the form merged with Allied Breweries, hence the conception of Allied-Lyons.  In 1994, Pedro Domecq merged with allied Lyons. In the late 2000s, Bain Capital purchased Dunkin Brands consisting of Dunkin’ Donuts and Baskin-Robbins.

Over the last decade, the firm struggled to retain business. The economic crisis is partly to blame for woes that ensued. Other factors that contributed to business slowdown include mounting competition from start-up ice cream specialists and the soaring tax rates in foreign companies. However, the Company saw a rebound in financial performance as from 2014. In fact, Baskin-Robbins continued its expansion streak through the opening of more than 17 new international shops. In addition, Baskin-Robbins introduced ice-cream to supermarkets and retail shops all over the United States.

Baskin-Robbins Corporate Social Responsibility

Baskin-Robbins has established a community foundation that makes sizeable donations to charities and humanitarian activities. The Baskin-Robbins Community foundation provide basic needs to local communities in developing world to ensure alleviation of poverty and hunger. Besides, the foundation dedicates itself to improvement of needy children’s health and ensuring the safety and security of the neighborhoods.

Baskin-Robbins understands the need for environmental awareness. As such, the firm embraces sustainability in its activities to minimize its impact on the environment. On the other hand, the employees, stakeholders and farmers that provide raw materials are treated with respect. They are treated fairly, hence are empowered achieve their goals hence boosting the organization’s long-term performance.

Baskin-Robbins Financial Health

a.       Market Capitalization =4.2 Billion.

b.     

1.89

            From the calculation, it is evident that the company can easily repay debts over the period of the year. This is because the current assets are much higher than the current liability. Therefore, the firm can liquefy the current assets to cover for liabilities should the need arise.

c.      

= 7.61

From the calculation, it can be concluded that Baskin-Robbins depends on investors and lending institutions. This leads to a heavy risk to the business as the pressure is piled on the management to avoid scaring off investors and money lending institutions. A business entity in this situation can engage in malpractices and unethical activities like falsification of financial outcomes as a cover-up for business weaknesses.

d.      Analysis of the Company

The financial health of the business is deteriorating. The exposure of a business to a high level of risks implies that Baskin-Robbins is prone to market shocks. Though the Firm can easily repay debts, the technique would only be applicable in the short-run. In the long-run, however, the organization can take a heavy hit that can spark a streak of losses, hence scaring away potential investors. This will threaten the survival of the business.

Baskin-Robbins’ management should enact policies that will lower the business risks. Some measures that are applicable in place include establishment of a reserve fund to jumpstart the business in case of economic turmoil. In addition, the organization should diversify its investment to minimize risks resulting in overdependence in one sector.

Mission

Baskin-Robbins’ mission is to be the globe's fastest growing organization through sales maximization, building a strong brand and maximizing profit. The current and future success of the organization is dependent on the firm’s ability to deliver on innovation.  New and exciting products can be introduced to the marketplace. Besides, Baskin-Robbins strives to identify new ways of engaging with the Franchise’s business partners.

Strategy

            Baskin Robbins’s Mission will be achieved by ensuring strong cooperation among the employees and the management. Besides, the firm has an effective marketing team that ensures creation of awareness of the firm's new and existing product. The Company considers the customer as a king. Hence, all the business activities are conducted with consideration of customer needs to ensure their satisfaction and absolute loyalty to the firm and its products. 

            The management is aware of growing competition. Therefore, measures have been put in place to counter the effects of surging competition. For instance, the firm is currently upgrading the technology utilized in serving customers globally. Online sales have been adopted in most chains shops in the United States and Europe. In addition, there is a provision of after sales services including delivery of ordered Ice Cream and Cakes.

Goal

Currently, the company aims at expanding to developing countries. The reason for this expansion is to tap on growing middle-income earning group. In African countries, for instance, there is rapid economic growth as compared to the developed world. As such, the business conditions are favorable.

The goal of expansion to developing countries is SMART. Firstly, it is clear that there is a targeted market segment. Secondly the firm has experience in penetrating foreign markets--the experience will come in handy for an already established business entity, unlike a startup. Besides, the goal is measurable because tangible data is obtainable after a year of activity in a new business environment. The top level management can utilize the results in determination of business continuity.

Baskin-Robins’ goal is in line with the overall mission. In fact, it is geared towards maximization of profit and improvement of business prospects. Dates for achievement of the goal can be set. Thereafter, a detailed analysis will be conducted to ascertain the level of business feasibility and long-term sustainability measures (Balmer & Edmund, 175).

Stakeholders:

1.      Klinke Brothers: Klinke Brothers is a Memphis supplier of ice cream. In addition, the supply company has a subsidiary that provides paper goods for instance cups, napkins and spoons. The delegated duties enable smooth flow of activities without hiccups resulting from managerial conflicts work overloads. In other countries, suppliers of different requirements differ as per the locality and the proximity to Baskin-Robbins’ premises.

2.      Morgan Stanley Investors: This firm has invested heavily on Baskin Robins. As at the second quarter of 2015 financial year, the firm held more than 2.8 million shares that represent nearly 3% of the total shares. This earns the investment company the top position. However, the runners up are close behind. DNKK has a policy that allows for freedom of investors, making it easier for any major investor in the list to accumulate or sell off shares without limits. 

3.      Employees: Baskin Robins’ management is well aware that employees play a critical role in the success of any business organization. There is a heavy investment in employees’ training to boost their performance and to equip them with necessary skills. In the recent past, the firm has motivated employees through rewards, promotions, and recognition. The human resource department utilizes Human Resource Information System (HRIS) in the employee selection process as a means of ensuring that the best talent joins the available workforce.

The Impact of Technology on Business

            Technology is rapidly evolving. Most business entities are adopting technology in the day to day operations to curb competition. In the case of Baskin-Robbins, technology has impacted heavily on the business operations. Today, most activities including ordering and supervision of activities have been automated. Therefore, technology enables the management to cut the cost of operations significantly. Then, the saved funds are utilized in other areas that improve service delivery. Besides, adoption of technology in record keeping seals the loopholes through the limitation of corrupt activities and heightening the level of accountability (Melville et al., 296).

Organization of the Company

Image 1: Baskin and Robbins Organizational Structure

The Company has a traditional design evidenced by the simple structure that has all the managers answerable to the CEO.  The management is stripped to its bare essentials to ensure accountability and to avoid cases conflicts. It should be noted that a complex company structure makes it hard for employees to determine the individuals they are obliged to report. A functional organizational structure is hierarchical, each level of management answerable to the top level (Rummler et al., 62). In the chart above, there are four levels of management.

Key Leaders and Managers in the Company

Anthony J. Gioia

Anthony is the chairperson of Management Board. He is also the overall CEO and president of the company. In the past, he has served as a CEO and President if Southwest Hypermarkets. Currently, he is an Executive partner of Emigrant Capital Corporation (ECC). In addition, he is the Chairman of Togo’s Eateries. He is the current president of Baskin-Robbins International and Baskin-Robbins USA.

He has an M.B.A degree from Iona College. He did undergraduate studies at NYC College. He is affiliated to TC Global, Robeks Corporation, and Emigrant Capital Corporation.

Nigel Travis

Nigel Travis is a Chairman and CEO of Dunkin’ Brands Group since 2009. Dunkin’ Brands is an umbrella company for Baskin-Robbins. In addition, Nigel is a Managing Director of Nigel Travis Enterprises Ltd. He was once the president of Dunkin Donuts and a consultant of Blockbuster inc. he is also a Lead Director of Office Depot Ltd.

He  earned his bachelor’s degree at Middlesex University in 2001. He is affiliated to many companies including UI Video holdings, BB Liquidating Co., and Lorillard Inc. He is entitled to annual calculated compensation of $10 Million US Dollars.

William Mitchell

Mitchell holds an office of the Presidency of Canada's Baskin-Robbins. He also holds a similar position in the firm’s branches in US, Japan, Korea, and China. He holds these multiple positions since 2013. He has a bachelor’s degree from New York University and is affiliated to BR 31 Ice Cream Company and Papa John’s Int. Inc.

Members of Board of Directors

1.      Carlos Andrade- Franchisee at North East Company.

2.      Bill Bode- Employee at Dunkin Brands.

3.      Mitch Cohen—Franchisee and a Co-Chair at Dunkin Brands.

4.      Scott Hudler—VP at Global Consumer Engagement.

5.      Mike Comody—Franchisee.

6.      Dominic Laskero—Director of Operations at BR.

7.      Tom Manchester—VP, Field Marketing.

8.      Demy Martin—South East’s Franchisee.

9.      Karen Raskopf-- Senior Vice President at Corporate Communications.

10.  Cindy Savich—BR BAC Franchisee.

11.  David Sisson--Midwest and Dunkin Donuts Franchisee.

12.  Konse Skrianos—DD BAC Franchisee.

13.  Alex Smigelski—Mid Atlantic Franchisee.

Tom Manchester, Karen Raskopf, and Scott Hudler are not employees of Baskin-Robbins. A background check reveals that these board members have exhibited resilience to market changes in the firms. Karen Raskopf, for instance, has accumulated a wealth of business experience for over 20 years in a relevant field. Her presence in the board will be beneficial especially in making decisions that affect female customers (Malhotra & Peterson, 34). On the other hand, Scott Huddler is an established entrepreneur in his right. He successfully steered Global Consumer Engagement through 2008 economic recession. Lastly, Tom Manchester is credited for the renounce of the firm in 2012 from a financial crisis.

The CEO utilizes a Laissez-Faire leadership style. He understands the need for innovation to ensure prosperity in the organization. Innovation is hardly attainable in a business structure that does not allow employees to express their ideas freely. It is the reason why the firm has beat the odds to post profits during the times that competitors are making losses (Eagly et al., 569). Of keen to note is that the CEO motivates hardworking employees through rewards and promotions.

The upper management transmits the company’s culture first line employees through rituals. For instance, employee welfare activities held periodically involves participation of all employees regardless of hierarchy. During these events, there is free mingling and sharing of ideas through socialization. This way, fear is eliminated and confidence is instilled among the employees.

Corporate Culture

            The company exhibits a market culture. All the activities engaged by the staff are directed towards developing a positive image for the organization. Customers are considered during decision making and Public relation activities play a vital role (Denison, 17). The stiff competition necessitated the adoption of a market culture at Baskin-Robins.

Herzberg’s Hygiene motivation theory characterizes the business environment at Baskin-Robbins. Dissatisfied employees hardly deliver to the expectation of the management. As such, employees' welfare is catered to eliminate detriments to their performance. In fact, a benefits scheme has been established to meet the needs of employees. As a result, employee strikes are hard to come by, hence ensuring smooth flow of activities.

In summary, two entrepreneurs with a single mindset built Baskin-Robbins from scratch. They expressed their passion towards business, which motivated them to establish a solid foundation. Decades later, the organization is anchored on the founding pillars. This has enabled the development of a strong organizational culture between the employee and the management.

The motivation of employees has played an important role in the organizational success. In addition, the diversification in product and service provision eliminates risks emanating from a lean on a particular sector (Ambile & Teresa, 192). This enables Baskin-Robbins to wither the competition launched by startup rivals. 

Works Cited

Amabile, Teresa M. "Motivational synergy: Toward new conceptualizations of intrinsic and extrinsic motivation in the workplace." Human resource management review 3.3 (1993): 185-201.

Balmer, John MT, and Edmund R. Gray. "Corporate identity and corporate communications: creating a competitive advantage." Corporate Communications: An International Journal 4.4 (1999): 171-177.

Denison, Daniel R. Corporate Culture and Organizational Effectiveness. John Wiley & Sons, 1990: 1-26.

Eagly, Alice H., Mary C. Johannesen-Schmidt, and Marloes L. Van Engen. "Transformational, transactional, and laissez-faire leadership styles: a meta-analysis comparing women and men." Psychological Bulletin 129.4 (2003): 569.

Fucini, Joseph J., and Suzy Fucini. Entrepreneurs, the Men and Women Behind Famous Brand Names and how They Made it. GK Hall, 1985: 78-206.

Malhotra, N., and M. Peterson. "Basic Marketing Research; a decision-making approach." New Jersey 7458 (2006): 22-189.

Melville, Nigel, Kenneth Kraemer, and Vijay Gurbaxani. "Review: Information technology and organizational performance: An integrative model of IT business value." MIS Quarterly 28.2 (2004): 283-322.

Rummler, Geary A., and Alan P. Brache. Improving Performance: How To Manage the White Space on the Organization Chart. The Jossey-Bass Management Series. Jossey-Bass, Inc., 350 Sansome Street, San Francisco, CA 94104, 1995: 1-206.