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    Electrolux Case Answers To Questions

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    blackjack00
    Electrolux operates in a highly competitive global home appliance industry. The company faces challenges such as market consolidation, shifting consumer preferences, and increasing competition from Asian producers. Electrolux responds through strategic choices around market positioning, product development, and acquisitions to expand geographically. Recently, Electrolux focused its strategy by divesting its outdoor products division to concentrate on its core home appliance business. Managing organizational change is also a key part of Electrolux's strategy as it integrates acquired companies across many countries and cultures.

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    Electrolux Case Answers To Questions

    Uploaded by

    blackjack00
    182 views2 pages
    Electrolux operates in a highly competitive global home appliance industry. The company faces challenges such as market consolidation, shifting consumer preferences, and increasing competition from Asian producers. Electrolux responds through strategic choices around market positioning, product development, and acquisitions to expand geographically. Recently, Electrolux focused its strategy by divesting its outdoor products division to concentrate on its core home appliance business. Managing organizational change is also a key part of Electrolux's strategy as it integrates acquired companies across many countries and cultures.

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    ElectroluxCaseAnswersToQuestions

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    Electrolux operates in a highly competitive global home appliance industry. The company faces challenges such as market consolidation, shifting consumer preferences, and increasing competition from Asian producers. Electrolux responds through strategic choices around market positioning, product development, and acquisitions to expand geographically. Recently, Electrolux focused its strategy by divesting its outdoor products division to concentrate on its core home appliance business. Managing organizational change is also a key part of Electrolux's strategy as it integrates acquired companies across many countries and cultures.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as DOC, PDF, TXT or read online from Scribd
    Download as doc, pdf, or txt
    182 views2 pages

    Electrolux Case Answers To Questions

    Uploaded by

    blackjack00
    Electrolux operates in a highly competitive global home appliance industry. The company faces challenges such as market consolidation, shifting consumer preferences, and increasing competition from Asian producers. Electrolux responds through strategic choices around market positioning, product development, and acquisitions to expand geographically. Recently, Electrolux focused its strategy by divesting its outdoor products division to concentrate on its core home appliance business. Managing organizational change is also a key part of Electrolux's strategy as it integrates acquired companies across many countries and cultures.

    Copyright:

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    Download as DOC, PDF, TXT or read online from Scribd
    Download as doc, pdf, or txt
    of 2

    CHAPTER 1-------Introducing strategy

    Case example------Electrolux
    This is an introductory case example to illustrate the various elements of strategy – as presented
    in Chapter 1. It shows how these apply to a particular industry and competitors within the
    industry. These are some of the issues to highlight:

    Are these issues strategic?


    Section 1.1 of the chapter lists various characteristics of strategic decisions. You can ‘apply’
    this list to the case example. For example, they do affect:
    Long-term direction
    Competitive advantage
    Scope of activities
    Exploitation of core competences
    Stakeholder expectations.

    Levels of strategy
    There are several levels of strategy at Electrolux:
    Corporate (company as a whole)
    Business Line (e.g. ‘Consumer Durables’)
    Business Units (e.g. ‘White Goods Europe’)
    Operational (departments within business units).

    The Strategic position


    Some of the main issues are as follows:
    Environment
    Globalised industry
    Competitive mature markets
    Power of major retailers
    Market entry of Asian producers (LG, Samsung) via contracts with major retailers
    Also, developing markets (Eastern Europe, China)
    Changing consumer needs (polarisation in the market)
    Consolidation of retail outlets.
    Capability
    Originally, industrial design
    Cost efficiency
    Geographical coverage
    Consumer insights
    Brands
    Talent management.
    Expectations
    The need to maintain profitability – which has not proved easy in a very competitive
    industry
    Environmental issues (e.g. CFCs and recycling).
    Strategic choices
    We can think about the various ‘strands’ that make up a strategic choice as
    outlined in section 1.3.2 (and, of course, more fully in Chapters 6–9):

    The market is polarising, so there are two possible bases to gain competitive advantage.
    Either position 1 on the strategy clock (the low price ‘commodity’ positioning) or
    differentiated (‘value-added’ product/service features) positions 4 and 5 on the clock. It is
    not easy to run these two different positioning in parallel – without clever use of brands.

    There are several choices of development direction for Electrolux. Decisions on product
    development usually concern new features built on the current ‘platform’. Otherwise costs
    are difficult to contain. Market development opportunities exist in developing countries
    alongside the ‘trading-up’ of consumer requirements as economies become more prosperous.

    The method of development is also important. Electrolux’s recent history has been dominated
    by acquisitions.

    Strategy into action


    These aspects of strategy into action are illustrated in Electrolux:

    The company has had to restructure regularly as it grew. Acquisitions also required pruning
    and disposals to prevent the company from losing focus. The most recent decision to demerge
    the ‘outdoor products’ division as a separate company (Husqvarna) reflects a feeling
    in many sectors that re-focusing on a core business and core markets is likely to be more
    successful than a wider portfolio of activities. Point out to students that this is absolutely the
    opposite as to what happened at Electrolux in the 1970s and 1980s where, amongst other
    things, they had extended into metal manufacture.

    There is not much information about detailed processes, except reference to better product
    renewal and improvements in logistics, purchasing and production

    Managing change would be a particularly important issue given the possibility of cultural
    clash in such a geographically spread organisation. Also, development by acquisitions
    increases the cultural difficulties.

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