Essay on Patagonia Case Study

Words: 1748
Pages: 7

Patagonia Case Study
Key Strategic Issues (Why Important / Summary of Internal / External Analyses)

1) Balancing Commitment to Business with Commitment to Environment
A key issue facing management was balancing the company’s desire for environmentalism with its existence as a for-profit business. The idea of running a for-profit business implies operating at the lowest cost, growing as rapidly as financially feasible, and maximizing returns to financial stockholders ( I think it should be stockholder since it is financial return). A commitment to the environment can raise costs and hurt margins because environmentally-friendly policies are not the most financially savvy. This issue is important because Patagonia’s entire brand and
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3) Patagonia should expand their quality testing facilities in order to maintain quality. Due to the increase of suppliers, the necessity for quality control procedures would increase as well requiring the company to be able to test sample products and provide feedback at quicker rates.

1) Evaluate Patagonia’s strategy

Patagonia’s strategy is focused on designing, developing, marketing, and selling high-quality outdoors wear at premium prices. Patagonia is known for developing new material and design, and the company’s strategy has been to compete on innovation rather than on cost. The company employs a flat organization structure and creates a working environment of self-management that their employees enjoy being a part of , which effectively promote the culture of innovation . The unifying theme of the company is sustainability, integrity and quality. The company does things different than other traditional organization which makes it a successful company. It strives to maintain strong environmental commitments as well as “Ironclad” product quality. Patagonia maintains an image of the outdoorsman, the vagabond and the wilderness over the corporate. It does this by sticking to stringent environmental policies including donating the higher of 1% of revenue or 10% of net profit to over 300 environmental organizations. Patagonia also used its tri-yearly catalog that features world-class outdoor photography to build its brand image. ( Do we need to add