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Tangible Resources:
Financial: Jamba Juice had struggled with strategy here. The recent strategy to increase
the number of stores, and increase customer traffic was a way to fix lagging finances.
Physical: Stores were designed to be attractive, and showcase natural materials.
Technological: Jamba Juice was paying attention to up-to-date technology to improve
Organizational: Move to franchise and licensing models meant Jamba had less direct
Intangible Resources:
Human: Jamba did realize that promoting a consistent culture was key to its brand.
Innovative hiring practices ensured high quality new hires, use of “Ambassadors of
Innovation and creativity: The creative theatre-like atmosphere where customers could
observe food preparation was a way for Jamba Juice to differentiate itself and add value
Reputation: Attempt to get involved in the local community, pay attention to local
Applying the VRIN concept, Jamba Juice’s internal resources were all valuable, but few
were rare, and none were in-imitable or non-substitutable. The only major differentiator
NOTE – ADDITIONAL READING, WEB LINKS AND VIDEO:
From the Food Network in 2007, here’s a 4 minute video visit to Jamba Juice, promoting
the smoothie as an energy boost:
http://www.youtube.com/watch?v=J0N0YIKQMuM
Although popular with customers, many of Jamba Juice products have been criticized as
From a press release in May, 2009, Jamba Juice was also pursuing “eco initiatives”,
including an electricity reduction project designed to cut energy usage at store locations
by an estimated ten percent, and the introduction of more environmentally friendly
What does this tell you about Jamba Juice’s internal resources and capabilities?
Referencing Chapter 4: Assessing Intellectual Capital -
See the concepts of intellectual capital, human capital and social capital, all of which are
intangible assets that a company such as Jamba Juice needs to have in order to compete
Human capital involves the individual capabilities, knowledge, skills, and experience of
the company’s employees and managers. This knowledge is relevant to the task at hand,
as well as the capacity to add to this reservoir of knowledge, skills, and experience
through learning. Human capital is the foundation of intellectual capital. Intellectual
Intellectual assets or intangible resources are critical to organizational success. Investing
in a company is, in essence, buying a set of talents, capabilities, skills, and ideas –
Human capital: does the organization effectively attract, develop, and retain talent?
Does the organization value diversity?
Social capital: does the organization have positive personal and professional
relationships among employees and alliance partners?
Presence of Organizational Capabilities:
Specific Competencies or Skills: CEO White’s focus on the workforce, innovative hiring
practices, treating his employees well, encouraging teamwork and sharing of knowledge
Capacity to combine resources: How to combine the above competencies to continue to
1. How should Jamba Juice manage growth?
Referencing Chapter 6: Formulating Corporate-Level Strategies -
Corporate strategy focuses discussion on the questions of what businesses a corporation
should compete in, and how the businesses should be managed so they can create
Diversification is the process of firms expanding their operations by entering new
businesses. In related diversification, a firm enters a different business in which it can
benefit from leveraging core competencies, sharing activities, or building market power.
Some possibilities include:
●Mergers and acquisitions
●Strategic alliances
Whatever the choice, it should create value for all stakeholders – employees, suppliers,
Companies can achieve synergy through diversification in two ways:
Through related businesses (horizontal relationships)
●Sharing tangible resources
Or through unrelated businesses (hierarchical relationships)
●Value creation derives from corporate office
Core competencies reflect the collective learning in organizations—how to coordinate
diverse production skills, integrate multiple streams of technologies, and market diverse
Sharing activities means that value chain elements are shared across business units, so
that two or more activities are done by one of the businesses. This allows for cost
Acquisition is the incorporation of one firm into another through purchase. It can be a
means of obtaining valuable resources that can help an organization expand its product
In order for Jamba Juice to continue its growth, it might need to be even more aggressive.
Remember, in related diversification, a firm enters a different business in which it can
benefit from leveraging core competencies or sharing value-added activities. As
Jamba could also use its improved reputation to attract additional key licensing partners.
These strategic alliances could expand brand awareness via multiple channels. Jamba
In addition, as previously mentioned, Jamba Juice was now competing with much bigger
firms, and getting increased attention from the investment community. Could it become a
potential buy-out candidate – and be acquired by someone else?
2. OPTIONAL QUESTION: How should leadership manage innovation in this
industry, and is Jamba Juice still entrepreneurial?
NOTE: there are no PowerPoint slides to accompany the following.
Referencing Chapter 11: Strategic Leadership: Excellence, Ethics & Change –
See the concept of leadership, the process of transforming organizations from what they
are to what the leader would have them become. Leadership is proactive, goal oriented,
effectively they formulate and implement a strategic vision and mission. See Exhibit
11.1. This involves:
●Setting a direction
The interdependent nature of these three activities is self-evident. Consider an
organization with a great mission and a superb organizational structure, but a culture that
Leaders need to set the direction for the organization by continually scanning the
environment to develop knowledge of all stakeholders, and knowledge of salient
Leaders are responsible for designing the organization: a strategic leadership activity of
building structures, teams, systems, and organizational processes that facilitate the
Leaders play a key role in changing, developing, and sustaining an organization’s culture.
An excellent and ethical organizational culture is an organizational culture focused on
In nurturing a culture dedicated to excellence and ethical behavior, managers and top
executives must accept personal responsibility for developing and strengthening
appropriate behavior; consistently demonstrate that such behavior is central to the vision
Jamba Juice CEO James White had embarked on an aggressive expansion strategy. He
had a vision of Jamba Juice as a healthy, active-lifestyle company, and had initiated
White did appear skillful at scanning the external environment to identify the trends and
events that might affect the firm’s long-term strategy. The awareness of how
By transitioning to an innovative multi-venue franchise model, also using consumer
Referencing Chapter 12: Managing Innovation & Fostering Corporate
Entrepreneurship –
Innovation involves using new knowledge to transform organizational processes or create
commercially viable products and services using the latest technology, experimentation,
creative insights, and information from competitors. However it comes about, innovation
Before proceeding, firms must first define the scope of the innovation efforts, and must
A strategic envelope defines the range of acceptable projects. Strategic envelope means a
firm-specific view of innovation that defines how a firm can create new knowledge and
learn from an innovation initiative even if the project fails. The strategic envelope also
gives direction to a firm’s innovation efforts, which helps separate seeds from weeds and
In defining the innovation scope, a firm should answer several questions:
●How much will the innovation cost?
●How likely is it to actually become commercially viable?
●How much value will it add; that is, what will it be worth if it works?
●What will be learned if it does not pan out?
The challenges of innovation involve:
●Choosing when and how to continue to innovate
●The scope and pace of future innovation
Jamba Juice was in an expanding industry – with McDonalds and Starbucks as direct
competitors, it was increasingly hard to define the boundaries. Jamba Juice had to
However, the scope and the pace of innovation would be critical here. Any innovation
might require re-education to key stakeholders – especially franchisees, licensing
partners, and employees. It was important for all to hear the same message and deliver it
Jamba Juice would always have imitators. Jamba Juice must continue to reassess its
internal and external environment in order to build its competencies, mitigate areas where
Referencing Chapter 8: Entrepreneurial Strategy & Competitive Dynamics -
Entrepreneurship involves the creation of new value by an existing organization or new
venture that involves the assumption of risk.
For an entrepreneurial venture to create new value, three factors must be present—an
entrepreneurial opportunity, the resources to pursue the opportunity, and an entrepreneur
or entrepreneurial team willing and able to undertake the opportunity. Entrepreneurs must
Entrepreneurs need to understand the concept of opportunity recognition: the process of
discovering and evaluating changes in the business environment, such as a new
technology, socio-cultural trends, or shifts in consumer demand, that can be exploited.
Changes in the external environment can lead to new business creation, but the discovery
Resources are an essential component of a successful entrepreneurial launch. The most
Important resource is usually money, but human resources, strong and skilled
management, is also an essential asset. Social capital, or entrepreneurs who have
Launching a competitive venture requires a special kind of leadership involving courage,
belief in one’s convictions, and having the energy to work hard. Three characteristics of
entrepreneurial leaders are:
●Vision
To achieve excellence, venture founders must understand the customer, provide quality
Under CEO James White, Jamba Juice had a leader with energy, dedication and drive,
and a clear strategic vision for the future. White had appeared capable of identifying and
developing potential opportunities for growth: the demand for healthy snack alternatives
