Professional Documents
Culture Documents
MANAGEMENT
CASE TWO
PREPARED BY: M.BABAR KALAM
(20746)
USHAIR FAREED (20988)
AMIR (20963)
ASIF JAVED (20901)
FACTORS
HUFA
Economies
of scale
Small
CAPITAL
REQUIRE
D
LOW
ACCESS TO
DISTRIBUTIO
N CHANNELS
AMPL
E
MUFA
NEUTRA
L
MFA
HFA
COMMENTS
Larg
e
THE
EXISTING
COMPANIES
REAPED
ECONOMIE
S OF SCALE
WHICH
MADE IT
QUITE
DIFFICULT
FOR NEW
ENTRANTS
TO SURVIVE
IN THE
INDUSTRY
HIGH
CAPITAL
REQUIRED
TO START
UP A
BUSINESSIN
THE GIVEN
INDUSTRY
WAS QUITE
HIGH
RESTRICTE
D
BOTH THE
INDEPENDENT
RETAILERS
AND POWER
RETAILERS
WERE PREOCCUPIED
EXPECTED
RETALIATION
LOW
DIFFERENTIATION
BRAND
LOYALTY
EXPERIENC
E CURVE
GOVT.
ACTION
LOW
LOW
HIGH
INSIGNIFICAN
T
LOW
HIGH
EXPECTED
RETALIATION
WAS QUITE
HIGH BY
EXISTING
COMPANIES
EXISTING
COMPANYS
PRODUCTS
WERE HIGHLY
DIFFERENTIATED
HIGH
SIGNIFICAN
T
HIGH
EXISTING
COMPANYS
PRODUCTS
WERE WELL
POSITIONED
IN THE
MINDS OF
THEIR
CUSTOMERS
EXISTING
COMPANYS
WERE HIGHLY
EXPERIENCED
IN THEIR JOB
THERE
WERE NO
SIGNIFICANT
ACTIONS BY
THE GOVT.
TO DETE
THE ENTRY
AVERAGE
SCORE
4.125
STRONG
ENTRY
BARRIERS
EXIT BARRIERS
SPECIALIZE
D ASSETS
FIXED
COST OF
EXIT
HIGH
HIGH
STRATEGIC
INTERRELATIONSHIPS
GOVERNMEN
T BARRIERS
HIGH
HIGH
LOW
THERE
WERE NO
SUCH
SPECIALIZED
ASSETS
LOW
NO
SIGNIFICANT
FIXED COST
TO EXIT
LOW
THERE WERE
DEEP TIES OF
EXISTING
COMPANIES
WITH
SUPPLIERS
AND
DISTRIBUTER
S
LOW
NO
BARRIERS
TO EXIT AT
ALL FROM
THE
INDUSTRY
AVERAGE
SCORE
3.75
EXIT
BARRIERS
ARE V.LOW
COMPETITIVE RIVALRY
COMPOSITION
OF
COMPETITOR
S
MARKET
GROWTH
RATE
SLO
W
SCOPE OF
COMPETITIO
N
FIXED
STORAGE
COST
EQUA
L SIZE
GLOBA
L
HIGH
UNEQUA
L SIZE
THERE WERE
FEW MAJOR
COMPETITORS
OF ALMOST
EQUAL SIZE
HIGH
INDUSTRY
ATTAINED
MATURITY
SO
GROWTH
RATE WAS
STAGNANT
DOMESTI
C
MAJORITY
OF THE
COMPANIES
IN THE
INDUSTRY
WENT
GLOBAL
LOW
AT ONE END
THE GOODS
ARE
DURABLE
SO NO
THREAT OF
EXPIRY ON
THE OTHER
END THE
SPACE
OCCUPIED
BY THEM IS
HUGE
CAPACITY
INCREAS
E
LARG
E
DEGREE OF
DIFFERENTIATION
STRATEGIC
STAKE
AVERAGE
SCORE
COMMODIT
Y
HIGH
SMAL
L
HIGH
2.57
SOME OF
THE
COMPANIES
TO ACHIEVE
ECONOMIE
S OF SCALE
INCREASED
THEIR
CAPACITY
ALL INDUSTRY
INCUMBENTS
WERE
PRODUCING
HIGHLY
DIFFERENTIATED
PRODUCTS
LOW
MOST OF THE
COMPANIES
WERE WELL
ESTABLISHED
GLOBALLY
STRENGTH
OF
COMPETITIVE
RIVALRY
DOES EXIST
MODERATELY
THREAT OF SUBSTITUTE
PRODUCTS
THREAT OF
OBSOLESCENC
E OF
INDUSTRYS
PRODUCT
AGGRESIVENES
S OF
SUBSTITUTE
PRODUCT IN
PROMOTION
SWITCHIN
G COST
PERCIEVED
PRICE/VALUE
HIGH
HIGH
LOW
HIGH
LOW
DUE TO RAPID
CHANGE IN
TECHNOLOGY
THERE IS A
THREAT OF
OBSOLESCENCE
LOW
NO CLOSE
SUSTITUTE
PRODUCTS
AVAILABLE
HIGH
NO CLOSE
SUSTITUTE
PRODUCTS
AVAILABLE
LOW
PERCIEVED
PRICE IS
LOW
AVERAGE
SCORE
4.25
VERY WEAK
THREAT OF
SUBSTITUTE
PRODUCTS
POWER OF SUPPLIERS
NO. OF
IMPORTANT
SUPPLIERS
FEW
MAN
Y
NO. OF
SUPPLIERS
PROVIDING
THE
REQUIRED
MATERIAL
WERE FEW
SWITCHIN
G COST
HIGH
LOW
IT IS HIGH
DUE TO
LONG TERM
CONTRACT
S AND
ALLIANCES
HIGH
SUBSTITUT
E
MATERIALS
WERE
AVAILABLE
AVAILABILITY
OF
SUBSTITUTE
S
LOW
THREAT OF
FORWARD
INTEGRATION
HIGH
IMPORTANCE
OF BUYERS
INDUSTRY
TO
SUPPLIERS
PROFIT
SMAL
L
QUANTITY
PURCHASE
D BY THE
INDUSTRY
OF
SUPPLIERS
PRODUCT
SUPPLIERS
PRODUCT
AN
IMPORTANT
INPUT TO
THE
BUYERS
BUSINESS
AVERAGE
SCORE
LOW
LARG
E
HIGHLY
IMPORTANT
2.57
LOW
SOME WHAT
UNIMPORTANT
HIGH
LESS
IMPORTANT
NO SUCH
INTENT OF
SUPPLIERS
DUE TO FEW
SUPPLIERS
ALL THE
MATERIAL
WAS
PURCHASED
FROM THEM
MATERIAL
PURCHASED
WAS OF
UTMOST
IMPORTANCE
SUBSTANTIAL
POWER OF
SUPPLIER
POWER OF BUYER
NO.OF
IMPORTANT
BUYERS
FEW
THREAT OF
BACKWARD
INEGRATION
HIGH
PRODUCT
SUPPLIED
SWITCHIN
G COST
COMMODIT
Y
LOW
SPECIALIT
Y
MAN
Y
SEVERAL
BUYERS
LOW
NO
CHANCE
HIGHLY
DIFFERENTIATED
SPECIALITY
PRODUCT
HIGH
VERY LOW
%AGE OF
BUYERS
COST
HIGH
PROFIT
EARNED
BY
BUYER
LOW
IMPORTANCE
OF FINAL
QUALITY OF
BUYERS
PURCHASE
LOW
HIGH
LOW
MOERATELY
LOW
HIGH
ONLY
INDUSTRIAL
APPLIANCE
S EARNED
PROFIT
DUE TO INTENSIVE
R&D BUYERS
EXPECTATIONS
ABOUT QUALITY
ALSO
INCREASED+QUALITY
OUTPUT BY BUYER IS
ALSO REQUIRED ***
4.14
Unfavorable
Neutral
Favorable
Entry Barriers
4.125
Exit Barriers
3.75
Rivalry among
2.57
existing firms
Power of buyers
Power of suppliers
4.14
2.57
Threat of substitute
Total score
(AVERAGE)
4.25
3.56
PRODUCT INNOVATION
MARKETING INNOVATION
As mentioned above the industry attained maturity and
the only means of reaping fruit from it was through
innovations such as marketing innovations .When firms
are successful in introducing new ways to market their
product or are successful in repositioning it to capture
value from the customer, they can spark a burst of buyer
interest, widen industry demand, increase product
differentiation and reshape customer demand to their
advantage.
Weight
Company
Whirlpool
Rating
Company
Whirlpool
Weighted
Score
Company
GE rating
Company
GE
Weighted
Score
Company
Maytag
Rating
Company
Maytag
Weighted
Score
Technological
Related
(Smart
Appliances
based on A.I)
Manufacturing
Related
(Lean + Six
Sigma)
Distribution
Related
(independent
dealers +
power
retailers)
Product
Innovation
(latest
designs)
Marketing
Related
(advertisement
campaigns)
0.3
1.2
1.2
1.2
0.1
5
0.45
0.45
0.1
5
0.4
5
0.4
5
0.45
0.45
0.2
0.6
0.4
0.6
0.2
0.4
0.4
0.6
Total
3.1
2.9
3.3