Rajadurai Vasanthakumar - 809444 - CW2 - Global Engineering Strategy - Rev001
Rajadurai Vasanthakumar - 809444 - CW2 - Global Engineering Strategy - Rev001
CU ID: 809444
25/June/2024
Table of Contents
1.
Introduction 4
5. Boston Matrix____________________________________________________________10
5.1 Stars_________________________________________________________________10
5.2 Dogs_________________________________________________________________11
6.4 Diversification_________________________________________________________14
8.Conclusion_______________________________________________________________17
9.References_______________________________________________________________18
2
LIST OF FIGURES
Figure 1: Elements of Manufacturing Strategy Development...................................................6
Figure 2: Boston Consulting Group (BCG) Growth Share Matrix..........................................10
Figure 3: Personal computer (PC) vendor shipment share worldwide from 2006 to 2023
(Source: www.statista.com).....................................................................................................12
Figure 4: Ansoff Matrix for Dell & Lenovo............................................................................14
Figure 5: Three strategies to achieve successful outcomes in Global Engineering.................17
LIST OF TABLE
Table 1: Hill's Strategy Development Framework to dell..........................................................9
Table 2: Hill's Strategy Development Framework to Lenovo...................................................9
1. Introduction
As Terry Hill rightly pointed out, it is very crucial to ensure that the manufacturing
strategy fits congruently with the firm’s strategy and many functional plans. This alignment
is done by explaining the company strategy as the first step in the production strategic
planning process, and by including many non-production strategic planning personnel from
the company’s functional areas outside the production line. During the last 15 years,
numerous developed as well as several developing industrial nations like Japan Germany
and Italy and the newly emerging two industries Asian tigers Korea and Taiwan have
successfully secured the edge of manufacturing. In particular, the Japanese have selected
horse-down markets and provided better products whereas no merit making of material and
energy resources. The first examples mentioned above can speak of this. One of these
critical success factors that have been instrumental to this achievement in manufacturing has
been the adoption of these practical considerations in the strategic discourse of the firm. At
this point, it is required to clarify what this involves and in what ways it differs from typical
approaches to managing production.
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system and operations, they provide a competitive edge to the company that may otherwise
be difficult for competition to overcome. Though a rare precedent, it can be illustrated
through Pilkington’s float glass technique. The second goal is to organize the production
support by forming pairs that work in tandem to guarantee that company’s products will
overpower competitors in capturing orders in the market. Manufacturing sets policies about
processes choice and infrastructure requirements controls, procedures, systems, and
structures —that are congruent with the present way that the products get orders. These
policies also enable future adjustments where there is an updated requirement to adapt to
depending on changes in business.
An obvious consequence is the need to change from a post-crisis position to a predictive
one. The production process remains unhealthy fixed and requires that all the numerous
critical factor in choosing the process and setting up the right infrastructure to support it
should be taken into consideration when undertaking business decisions. For information,
the business should ensure it is fully aware of the likely consequences to manufacturing in
the event of proposed change to the corporate entities’ structure (Bhujbal et al., 2021). After
this is achieved, other strategic decisions that follows can be made bearing in mind the best
consequences for the overall firm. Thus, the management of production is gradually moving
to become more strategic in its orientation. However, it is only reasonable for the
management to focus their activities on strategy while recognizing the importance of
operations in accordance to the potency that strategy and operations possess on overall
organizational performance. However, it is important to admit that both facets demand some
amount of skill. Managers, especially at the top level, have in general understood corporate
improvements as originating mainly from strategic management activities linked to new
products and markets, and acquisitions and similar measures. However, the core factors that
define corporate goals have always focused on creating effective and profitable
organizations that integrate manufacturing and selling with the market’s needs and wants
with the help of the rationally and logically justified and well-perceived corporate strategy.
Step 1:
Corporate Strategy
Step 2:
Strategic approach to promoting and
selling
products
Step 3:
What are the criteria for products t
o meet in
order to be considered eligible and
successful in securing orders in the
market?
Step 4:
Selection of a Procedure
Step 5:
Infrastructure
The manufacturing plan should also consider the competitiveness of the industrial
equipment and systems in terms of their modernity (Chauhan et al., 2023). This exercise
aims to facilitate the incorporation of accurate input into the business strategy and budget.
Occasionally, to maintain competitiveness, substantial investments of capital are necessary,
which may not be accessible.
Qualifiers are the specific conditions that a firm must satisfy for a customer to even
consider it as a potential supplier. For instance, clients are increasingly demanding that
suppliers be registered under the ISO 9000 standard. Suppliers who are registered have only
obtained the privilege to submit bids or be taken into consideration. Moreover, it is
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imperative for them to maintain the qualification to remain on the short list or be regarded as
a contender in a specific market. Merely fulfilling or acquiring these criteria does not
guarantee winning orders.
The importance of differentiating between the factors that lead to winning orders in
the market and those that just qualify the product to be present is emphasized in the
following example. Upon entering the television market, Japanese firms shifted the criteria
for winning orders from primarily pricing to product quality, namely in terms of conformity,
and reliability in service (Deshmukh et al., 2022). Due to the subpar product quality and
unreliable service of current television sets, existing producers were losing orders to
Japanese companies in this competitive market. In other words, the existing manufacturers
were not meeting the necessary criteria to remain in the market. During the early 1980s,
firms who had lost orders improved the quality of their products to regain eligibility to
participate in the market. Consequently, the primary factor that determines success in this
market has returned to being the price.
The manufacturing strategy, together with the required expenditures and timeline for
implementation, become integral components of the corporate strategy discussion.
Several empirical studies have investigated certain elements of the internal and
external factors that influence competition in the computer industry (Ding et al., 2021). The
study offers valuable insights into the competitiveness between online and retail channels in
highly competitive businesses. The researchers examined the impact of market orientation
on performance. According to their data, market orientation has a beneficial impact on
business success in both the short and long term. Their analysis also indicates that
organizations with an initial market orientation see greater increases in sales and profit
compared to firms that establish market orientation later. According to the research, a
company's growth is influenced by the capability of its top executives to recognize, develop,
and take advantage of the fundamental skills and strengths.
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3. Applying Hill's Strategy Development Framework to Dell.
Table 1: Hill's Strategy Development Framework to dell
• Implement standardisation
Suppy Chain procedures
(Antoni, A. et. al., 2022, pp
1489-1495) to optimise order • Seeking proactive individuals
for recruitment
processing, hardware
• Upselling • Consistent training
To achieve rapid and substantial assembly, and delivery
• Ongoing promotion . • Acknowledgment and
timelines.
expansion • Digital Marketing Strategies. Incentives
• The establishment comprises a
(Nuseir, M. T. et. al., 2023, pp 21-44) • Passion for attaining planned
physical store, a storage
facility, a customer service sales targets
High-quality products and
services centre, and an integrated
operational system.
• Quality control of services
In tables 1& 2 explain that the applying Hill’s Strategy Development Framework for Dell
and Lenovo is clear evidence of how he fully embraces manufacturing strategies within the
broader context of corporate and marketing strategies. Dell uses a specialized production
model that is flexible, inexpensive and customer accessible, as it entails constructing
computers after receiving an order from the client, therefore avoiding large inventories and
ensuring quick adaptation to market trends (Hossain and Kader, 2020). Lenovo, on the other
hand, utilizes a mixed kind of manufacturing approach where it has in-house production
facilities while outsourcing other aspects of the production chain with an aim of achieving
optimum cost and attaining a global market for the company’s products. While Dell’s
business strategy is on cost efficiency and customization of products based on customer
needs and wants, Lenovo’s direction approaches the realization of effective and generic
technological solutions and environmental development in different product offers. Dell, on
the same aspect, mirrors supply chain as its key tool of profiting direct sale while Lenovo
uses multi-channel sale to expand its geographical reach. These strategies are measured
using performance indicators such as productivity, rates of customer satisfaction, and
stakeholder market share, pushing the organizations to seek constant improvement and
innovation in their various processes.
5. Boston Matrix
10
Figure 2: Boston Consulting Group (BCG) Growth Share Matrix
The figure 2 Boston Matrix (BCG, 2014) is a tool used to categorize and describe an
organization's activities based on the markets it operates in. The matrix can be utilized to
depict strategic business units (SBUs) or product lines, which are subsequently positioned on
the matrix for analytical objectives. This presentation will allow the leadership team of the
organization to make informed decisions on how to effectively manage each company or
goods group. It will also help identify any gaps or areas that may become troublesome when
markets expand, reach maturity, or decrease.
5.1 Stars
Stars symbolize the business sectors that have a significant market share in a market
that is expanding. Market leaders who must make substantial and continuous investments to
sustain their growth and withstand competition typically dominate the activities in this
quadrant. However, the outcomes will much compensate for this expenditure, as these
endeavors yield substantial revenues for the manager.
Dell monitors are often regarded as stellar due to their inventive concepts and the
potential allure they might generate in the intended market (Lantada and Sevillano, 2017).
Dell has made substantial revenue from its laptops, particularly the XPS 15 and 17 models.
These laptops are known for their high degree of flexibility, featuring a 360-degree hinge,
and their ease of mobility. The introduction of the ultra-thin display necessitated significant
design modifications, resulting in a favorable reception from the intended market. It is
anticipated that the monitor will acquire a substantial portion of the market in the future,
suggesting the potential for this flagship product to become a highly profitable asset for Dell
Inc. Currently, the ultra-thin device is functioning in a thriving market that enables
companies to develop novel product designs and utilize fresh concepts to ensure
profitability.
5.2 Dogs
Dogs are situated in the lower right quadrant. They are the representatives of the
Strategic Business Units (SBUs) situated in a market with limited growth and a low
proportionate market share. These activities frequently see a decrease in popularity and are
engaged in markets where certain rivals hold a dominant position (competitive advantage).
These efforts associated with the process of ageing can require significant financial
commitments yet provide minimal or no outcomes in the long run. Hence, it is generally
recommended to discontinue these actions as they have the potential to adversely affect the
firm.
Dell has made the decision to introduce its own line of mobile phones in order to meet
the demands of smartphone consumers worldwide. The smart phone can be considered a
liability for the technology leader, as it has failed to generate profits. Despite the company's
aspirations, its foray into the smart devices market proved unsuccessful, as it was unable to
rival industry giants like Apple Inc.
Cash cows are business operations that have a relatively large market share in
industries that are experiencing a decline (Lestari, 2024). These activities frequently achieve
market dominance over their competitors in a mature market, thereby necessitating just
minimal expenditure. Undoubtedly, In the Figure 3 current market conditions are unlikely to
attract new participants and will not incentivize existing competitors to displace those who
are already established. The experience effect, namely due to the utilization of resources,
essential skills, and economies of scale, allows the company to attain greater profits
compared to its rivals. The objective of these efforts has shifted from progressing to
extracting maximum profit.
As a result, they frequently generate substantial cash influx and facilitate investment,
especially in the high-potential and uncertain areas.
12
Figure 3: Personal computer (PC) vendor shipment share worldwide from 2006 to 2023 (Source: www.statista.com)
According to the Boston Consulting Group Analysis, DELL can be broadly classified as a
'cash cow'. DELL holds a significant market share and revenues generated by these products,
ranking third globally following Lenovo and HP, in a low-growth industry. An exemplary
instance in this scenario is the Dell Desktop, which has consistently generated substantial
profits for the corporation. Despite a decrease in the demand for Desktop in the market, Dell
has managed to sustain operational profits by focusing on its Desktop division.
Question marks are activities that have a relatively small market share in expanding
markets. These strategic business units (SBUs) also give a promising possibility for future
profits, if substantial amounts of capital are invested at an early stage. In a robustly
expanding industry, it remains feasible to surpass the leading competitor by progressively
acquiring market share through strategic expenditure (Lin et al., 2020). The challenge of the
assignment comes in selecting the Strategic Business Unit (SBU) that possesses the potential
to establish a dominant position in the market and emerge as a top performer in the future. If
the anticipated investments are not acquired or are insufficient, the endeavor may become
unprofitable once the market achieves its full potential. The question marks should be given
particular attention. It is advisable to have multiple candidates, as not all of them will
achieve success, but they should be selected with caution.
Dell Inc's recent acquisition of cloud computing platforms has raised questions about its
future in the field of cloud computing. The next generation of cloud and fog computing
platforms managed by Dell is now in the early stages of development (Xu, 2024). Dell
stands to benefit financially from the growing popularity of cloud computing, since it has the
potential to generate more revenue and profitability for the corporation. Nevertheless, the
presence of potential failure suggests that this product segment is currently considered a
question mark, as its future progress remains questionable. Dell has the potential to position
cloud and fog computing as a prominent and very profitable asset in this field.
In the Figure 4 the computer hardware industry is a mature market. Therefore, Dell
can achieve more sales by enticing clients to switch to a different supplier or brand, so luring
them away from competition (Moshrefi et al., 2020). This typically entails modifying
components of the marketing mix, such as reducing prices, expanding the appeal of a brand,
or launching sales promotion activities. Typically, the emphasis is placed on customer
service rather than engaging in pricing wars, as such conflicts may be detrimental to all
parties involved and establishing unique product features is sometimes challenging.
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consistently pursues the advantages of value engineering and process efficiency, as well as
the chance to increase prices. This allows the organization to have valuable periods to
investigate additional long-term strategies for increasing income.
This method involves the introduction of new items specifically designed for the
organization's existing clients, with whom they already have an established relationship. The
optimal strategy is to enhance and develop an existing feature of the relationship.
Dell will provide new items that are closely linked to the products that customers presently
buy from a supplier. Therefore, a computer manufacturer has the option to expand its
product offerings by including computer peripherals like printers, plotters, and service
contracts, as well as consumables such as paper, ink, and discs. This allows the manufacturer
to provide a comprehensive and convenient shopping experience for customers.
Lenovo aims to enhance the way current consumers engage with suppliers (Van Hong and
Nguyen, 2020). Certain connections may be founded on a collaborative partnership approach
that involves shared problem-solving, whereas others may utilize a supplier for the sake of
convenience or for a specific attribute of their product or service. Each category of
relationship will offer distinct possibilities for incorporating new products into an
organization's assortment.
The third alternative in the Matrix involves exploring untapped markets for current
products. This entails the organization's task of identifying potential consumers in diverse
markets that have similar demands or discovering new customers who would uniquely use
the product (Nair et al., 2021). Dell and Lenovo are planning to establish their presence in
several locations within the same geographic region. While implementing such a change
may necessitate certain modifications to the product, as well as adjustments in marketing
and sales strategies, the expertise needed to provide the product would remain fundamentally
unchanged.
6.4 Diversification
The fourth approach, which involves introducing new products in new markets, is
considered the riskiest form of diversification for both Dell and Lenovo. This is because it
requires minimal utilization of the organization's current expertise or capabilities.
Additionally, this sort of growth exhibits the highest rate of failure. When businesses have
achieved success in this field, it is typically feasible to observe some synergy in sales,
distribution, or product technology.
Both Dell and Lenovo have a dispersed research and development presence worldwide,
lacking a comprehensive approach to their commercial goals. This is likely to result in
operational difficulties and strategic obstacles. As the growth grows, it becomes
progressively challenging the mothership to allocate equal attention to all its offshore
centers.
Dell encounters a range of operational difficulties and strategic obstacles. Some of the
challenges listed below:
3. The absence of well-defined metrics for assessing productivity and value generated
by these centers gives rise to perception problems.
5. The team’s capacity to develop new items is diminished due to a lack of client
access.
Lenovo encounters many operational concerns and strategic obstacles. Some of the
challenges listed below:
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4. Most teams allocate a greater amount of work into managing their current product
portfolio.
Advancing
Geographic
al
Developme
nt
Strategie
s
Effective
way of Approach t
organising o
and Product
managing Roadmap
costs
In Figure 5 each of the ideas can be adapted and implemented in different business scenarios
for Dell and Lenovo. The 'Advancing Geographical Development' strategy entails
evaluating the present level of development of each product in both new and established
regions, and clearly defining the responsibility and ownership of products in these locations
(Qu et al., 2022). The 'Approach to Product Roadmap' enables the company to carefully
consider and determine which items it intends to modernize or optimize soon. The 'Effective
way of organizing and controlling costs' strategy entails assessing the revenue generated by
teams at each site in relation to their costs.
8. Conclusion
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