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Komatsu
- 1. STRATEGIC MANGEMENT KOMATSU LIMITED GROUP-7 Adarsh NJ19DM015 Altamash Hasan 19DM027 Archika Singh 19DM047 Gurpreet Singh Sethi 19DM075 Manikandan Balaji 19DM101 Nidhi Agarwal 19DM123
- 2. Case in aglance • This case study talks about the world EME industry and mainly two competitors in it- Caterpillar Tractor Co. and Komatsu Limited. • It also talks about the reasons for the downfall of CAT i.e. the slowdown of US economy and the hostile relationship between CAT and UAW. • Mainly, it consists of all the necessary steps that Komatsu took to became one of the leaders in EME industry.
- 3. KOMATSU LIMITED • 1960’S I.Faced the problem of low quality products II. MITI opened EME industry to Foreign Capital Investment- CAT and Mitsubishi joint venture. III. Licenses and agreements with major manufacturers to face competition. IV. Successfully implemented Total Quality Control concept V. Launched Project A • 1970’s I. Komatsu started focusing on exports in this period II. Opened Komatsu USA.
- 4. I. Launched ProjectB – Large Bulldozers. II. Innovation – Large dump trucks, Radio controlled bulldozers. III. Four part cost reduction strategy. • 1980’s I. Bought technologies from technology suppliers. II. Expansion of subsidiaries, over sea offices & distributors internationally. III. Program EPOCHS - Efficient Production-Oriented Choice Specification. IV. Future & Frontier Project – Arc welding robots, heat pumps.
- 5. Q 1. Whatare the sources of Komatsu’s success? • Overseas orientation and user orientation • Setting up its own branch sales offices and local repair shops • Entering into agreements with major manufacturers like Cummins Engine, International Harvester, etc. • Launching TQC • Success of Project A and Project B • Focusing vigorously on exports • Implementing four-part cost reduction plan
- 6. • Digestion oflicensing technology, establishing its own technology • Projects EPOCHS- Responding to diverse market needs without compromising on cost position • Emphasis on R & D- Industrial Robots • Project “F and F”- Future and Frontiers- develop new products and businesses • Exports Expanded- Soviet Union and marketing efforts gathered momentum • Product diversification- Europe, Asia and Australia • Intertwined system of TQC, PDCA cycle and management policy • Good labour relations
- 7. Q2. How wasthe company able to challenge Caterpillar when so many larger and better established companies- like Internal Harvester, John Deere and J.I Case-had failed? • Alignment with the goals of the company • Acquisition of advanced technology • The second phase of project A emphasized on cost reduction. • Tried to capture the entire world market after Japan • Launching of project B. • Penetration in low development countries. • Improving the competitiveness of its products.
- 8. ● Introduced innovativeproducts: ○ Off-highway dump trucks, hydraulic excavators (earlier than Cat) ○ Radio-controlled bulldozer, amphibious bulldozer, remote- controlled underwater bulldozer (World’s first) • Price advantage. • Low cost high productivity labor force.
- 9. Q.3. : Howare environmental forces and industry changes likely to affect Komatsu’s competitive position vis-à-vis Cat? What recommendations you may have for Ryoichi Kawai? For Lee Morgan? • EFFECTS OF ENVIRONMENTAL FORCES AND INDUSTRY CHANGES: I. Cross-country differences in demographic cultural and market conditions. II. The impact of government policies and economic conditions in host countries. III. The risks of adverse exchange rate shift. IV. Variations in factory costs between different countries.
- 10. RECOMMENDATIONS • Encourage environmentalawareness among the company to identify new challenges • Diversify the product line focus on creating green, innovative products • Try to build worldwide dealer networks • Huge efforts and expense on integrating its value chain.
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