Transcript of "Presentation of strategy generic or strategy clock"
Business unit strategy: generic strategy
Presented to Ahmed Shehzad
Presented by Nabeel Ahmed
when you think about Bombardier, you think of a company that is the leader in the
market in which it operates. Today, the company controls two industry-leading
businesses which are Bombardier Aerospace and Bombardier Transportation. They
have groundbreaking products that range from commercial aircrafts, business jets,
rail transportation equipment, systems and services. Its headquarters are in
Montreal, Quebec, Canada. Bombardier and their shares are operated on the
Toronto Stock Exchange (BBD) and they are listed on the Dow Jones Sustainability
World and North America indexes. Bombardier Inc. set strong priorities for
international growth. They are constantly increasing their presence in growing
economies and that lets them capture opportunities, generate cost advantages and
reinforce their worldwide leadership and competitiveness.
In 1942, J.-Armand Bombardier found a company to
manufacture tracked vehicles for transportation on snow-
covered terrain. The company's name was L'Auto-Neige
Bombardier Limitée. •On January 23, 1969, listing of
Bombardier stock on the Montreal and Toronto stock
exchanges and public offering of two million shares. Shares
were now traded on the Toronto stock exchange. •In
December 1986, acquisition of Canadair, leading Canadian
aircraft manufacturer. •In March 1990, creation of
subsidiary Bombardier Real Estate Ltd., responsible for the
management of Bombardier's real estate assets. •In March
1992, acquisition made through a new company, de
Havilland Inc., whose equity is shared by Bombardier (51%)
and the Province of Ontario (49%).
Business unit strategy: generic strategy
Business unit strategy involves a choice between the lowest cost (cost leadership)
making the product different from competitor product in some way (differentiation)
or specializing on a segment of the market (fous,by addressing that segment by a
strategy of cost leadership or differentiation).porter believes that a firm must choose
one of these or be stuck-in-the-middle.
The choice of competitive strategy
Potter believes there are three generic strategies for competitive advantages.
(a): Cost leadership:
Means being the lowest cost producer in the industry as a whole.
Is the exploitation of a product or services which the industry as a whole believes to
Involves a restriction of activities to only part of the market (a segment)
• Providing goods and/or services at lower cost (cost-focus)
• Providing a differentiated product or services (differentiation-focus)
Bombardier aerospace is the cost leadership company He
produce low cost, When you think about Bombardier, you
think of a company that is the leader in the market in which it
operates. Today, the company controls two industry-leading
businesses which are Bombardier Aerospace and Bombardier
How to achieve overall cost leadership
(a): Economies of scale.
Company has a great set up to meet the production order, Soon after, the company
received an even bigger contract requiring the construction and supply of 825
subway wagons for the city of New York, making it the North American leader in
the railway industry.
(b): Latest technology.
Company use latest technology in manufacturing of aero planes or trains.
The company has two main products who manufactured.
• Bombardier Aerospace
• Bombardier Transportation
(a): Improved product:
The companies are not radically different from their competition but are
obviously superior in terms of better performance at a competitive price.
(b): Competitive products:
Bombardier aerospace and bombardier transportation is better than others
because they provide good service in low cost.
How to differentiable
Give the product special features:
• Every day, millions of people get where they need to go aboard the planes
that we manufacture. Perhaps you do too.
Our more than 35,500 employees design, build and service high-
performance aircraft. We set the standard of excellence in several markets,
• Business aircraft - Learjet, Challenger and Global aircraft families
• Commercial aircraft - CRJ Series, Q-Series and Series aircraft families
• Amphibious aircraft - Bombardier 415 and Bombardier 415 MP aircraft
• Specialized aircraft solutions -Bombardier aircraft modified for special
• Aircraft services and training - aircraft parts, maintenance, comprehensive
training, technical support and publications, and online services
Bombardier Aerospace is part of Bombardier, a global transportation
company present in more than 60 countries on five continents.
Bombardier’s other core business is Bombardier Transportation, the
world’s largest train manufacturer.
Focus (or niche) strategy:
After acquiring a few companies, Bombardier Aerospace was now faced with the
challenge of how to align the operations of these companies who all had different
sets of data, processes and systems. Major areas of concern were process delays, low
inventory turn, inconsistent pricing and billing of materials among others.
Bombardier introduced the Enterprise Resource Planning (ERP) into its aerospace
division with a vision to achieve higher efficiency in manufacturing and also to
significantly save cost. To assess the performance of this IT project, Bombardier
Aerospace needs to consider the following six variables which are interdependent as
far as success or failure is concerned.
• system flexibility,
• system variability
• ease of learning
• Information Quality
Bombardier Aerospace fiscal or calendar year delivery of regional, business
and amphibious aircraft:
• Net orders(2006 to 2013)
Drawbacks of a focus strategy
• The firm sacrifices economies of scale which would be gained by serving a
• Competitor can move to the segment, with increased resources.(e.g.
bombardier moved into the uk luxury air bus market, to compete with
Boeing air bus)
• The segment’s needs may eventually become less distinct from the main
Task no2;Strategy clock
The strategy clock develops porter’s theory, analyzing strategies in term of price and perceived
Low Price/Low Value
Bombardier company not fall in this point because he charge low price but provide
Bombardier companies charge a low prices with the high volume strategic reasons
for their position, they can sustain this approach and become a powerful force in the
Hybrid (moderate price/moderate differentiation)
Bombardier CSeries aircraft is positioned as value advantaged in the
commercial airplane manufacturing market space. Since the CSeries
offerings deliver superior value to customers relative to competitors at lower
list prices, Bombardier’s go-to-market pricing strategy is consistent with a
penetration pricing methodology. Bombardier’s aggressive entry tactics for
the CSeries aircraft offers a credible threat to existing Boeing and Airbus
Bombardier keep their prices low and seek greater market share as compared Boeing
and air bus company. Bombardier make machinery for jets and trains he provide
high quality product at low prices.
Bombardier Transportation is the leading manufacturer of rail technology in the
world. Around 70% of the vehicles used in Swiss public rail transport also come
Marketing, including powerful brand promotion
• Bombardier stands for the highest quality in railway technology
• Bombardier always offers an exceptional price/performance ratio on its products and
• Bombardier guarantees efficient business processes that are certified in accordance
with international standards.
• Bombardier offers solutions creating real added value for its customers.
• Bombardier is a partner who can be relied upon.
Bombardier Company focus on the making cs3000 jet in future and provide high
quality with charge of high price.
Increased Price/Standard Product
Bombardier provide high quality product due to increase in price they also improve
the standard quality of product.
High Price/Low Value
Bombardier company not use monopoly pricing strategy because there are many
competitor in the market (e.g. boeing,airbus,emarite)
Mid Size Passenger Jets(Bombardier-Aerospace
Bombardier C Series CS100
Price- 62.00 Million USD
Editor Rating - 8.10
Price- 71.00 Million USD
Editor Rating - 8.90
Light Passenger Jets(Bombardier-Aerospace
Bombardier CRJ 200
Price- 21.00 Million USD
Editor Rating - 7.30
Bombardier CRJ 700
Price- 24.39 Million USD
Editor Rating - 8.25
Canadair CRJ Series 705 Jet
Price- 29.00 Million USD
Editor Rating - 7.75
Bombardier CRJ 1000
Price- 46.37 Million USD
Editor Rating - 8.60
Passenger Turbo Props(Bombardier-Aerospace)-
Price- 13.00 Million USD
Editor Rating - 6.80
Price- 17.00 Million USD
Editor Rating - 8.00
Price- 27.00 Million USD
Editor Rating - 8.40
Heavy Business Jets(Bombardier-Aerospace)-
Bombardier Global 5000
Price- 49.00 Million USD
Editor Rating - 8.90
Bombardier Global Express XRS
Price- 51.00 Million USD
Editor Rating - 9.20
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