Komatsu
Komatsu Limited, a Japanese organization, was founded in 1921 as a specialized producer of mining equipment. The founder of the organization, Mr. Takcuchi, had two important requirements for management; overseas orientation, and user orientation. He also recognized that exporting was an important factor in becoming a prosperous organization. In 1931, the organization successfully produced a two-ton crawler type of agricultural tractor, which was the first ever in Japan. During the Second World War, Komatsu became a key provider of bulldozers, tanks, howitzers, etc. etc. In 1963, the Japanese Ministry of International Trade and Investment (MITI) decided to open the earth-moving equipment (EME) industry to foreign capital investment. The MITI thought is was essential to continue to protect the emerging Japanese auto and electronics industries. As an exchange, the EME industry was to be opened up since the MITI believed that Japan did not hold a long-run competitive advantage in the earth-moving equipment industry (Bartlett, Rangan 1985). This was the gateway Komatsu's competitor, Caterpillar, was looking for to obtain access into the Asian market. In the early 1960's Komatsu entered into licensing agreements with t
What is it that their customers are actually looking for based on their geographical location, as well as the type of usage they are looking for in a product? Defining the consumer's needs and providing for those needs is beneficial toward the overall success of the organization. Centralized ProductionAs previously discussed, Komatsu's centralized production concept was used to gain high degrees of quality in their products, and reduce component costs. The disastrous affects can be seen by PepsiCo's operations in Mexico with fluctuations in the peso. Also, with most of the growth opportunities occurring in the developing nations, Komatsu could not afford being turned away from exporting into one of these countries because of their centralized manufacturing policy. Resolutions/OptionsDistribution, Sales, and Service NetworkThe lack of these elements as part of Komatsu's operations has long been a detriment in their ability to compete with Caterpillar. Currently, the quality and reliability of Komatsu products has exceeded that of most of their competitors. Therefore, the option of doing nothing is a valid one, even if it imposes inherent risks. In 1981, Komatsu launched a new product call EPOCHS, which was short for Efficient Production-Oriented Choice Specifications. Ryoichi spent a great deal of his time monitoring the success of Caterpillar, and demanded that all Komatsu executives keep up-to-speed on Caterpillar through Caterpillar's monthly news-letter, which was expressed mailed directly to their Tokyo corporate headquarters. From an economical standpoint, Komatsu's dealer network had been crippled by the recession, forcing a major part of the dealer base into bankruptcy. Although doing nothing is also an option, it would only succeed in furthering the erosion of Komatsu's market share by Caterpillar. The environment can be composed of economic, political, legal, and social factors. These research facilities were located in four of their major plants. However, not only will their overall objective with this project to develop a worldwide market, but to also bring a broader product line to the overseas consumers with their improved quality and reliability. Imports"h Lighter Duty Equipment ProductsThreats "h Competition (CAT)"h Fluctuation of Yen"h Government policies toward Komatsu External Environment The external environment is the set of entities or objects surrounding an organization, which can have a direct affect on their company.
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