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Corning Inc. Case Study

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Corning Inc.
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Subject: Recommendations for the three proposals
Corning Inc.’s strategy – to compete in four worldwide business sectors (communications, laboratory sciences, consumer housewares, and specialty materials) and to deliver long-range superior economic benefits to its employees, consumers, communities, and shareholders – has served the organization well for over three decades as evidenced by a transformed business portfolio, record earnings, and the emergence of a new spirit within the organization.
However, due to diverse changes in trends that characterize the industry’s landscape, there is the need to come up with innovative proposals that originate from diverse business sectors. The CEO of Corning Inc. hopes that these proposals would aid in the company’s continual growth. These proposals deal with (a) the laboratory sciences, (b) communication (fiber optics), and (c), the television glass division. The opinions given are a result of a comprehensive deduction of the Porter’s Five Forces model so as to identify the best paths of actions to achieve a proper competitive advantage in the industry.
For the first proposal, I think it is vital that Corning maintains its relationship with Ciba Geigy. Ciba Geigy has portrayed a strong commitment to the partnership’s success as evidenced by its willingness to preserve with significantly low returns over the next few years as the venture continues to grow. Furthermore, it has a good strategic fit with Corning Inc.’s goals in the medical diagnostics field. However, company acquisitions in the laboratories is not expected to attain a considerable market presence coupled with a relatively significant growth capability. I support this relationship with Ciba Geigy owing to the attractiveness of the medical diagnostics industry. However, there are several key questions to be pondered. Is Corning playing a significant role in the partnership? Does it form a part of the underlying core business? Considerations also have to be placed on the relative investment in research and development. It is my opinion that Corning Inc. will have to immensely invest in the venture if it is to be considered as the dominant player as long as Ciba Geigy also values the business.
For the second proposal, I feel that IBM, being a strategic partner, will facilitate rapid technology development and aid in improving of its positions in the given peripherals. Nevertheless, it is essential to consider the fact that Corning Inc. might find itself falling out of its IBM partnership in the future after the IBM takeover. It is clear that the fiber optic business has a high growth potential and Corning should expand its involvement in this field. It is my opinion that Corning should leverage marketing and sales capabilities of the peripherals market of IBM and create a strong synergy between the given peripheral businesses.
For the final proposal, I feel that Corning should sell a significant amount of its television business and invest the returns in the development of LED screens. Such screens are in high demand due to their low weight and great energy consumption levels. The challenge is that there is a high competition in this market owing to reduced prices and common usage of the commodities. Considering the glass TV market, Corning is a secondary player, while Asahi is primary one, which implies that there is no market advantage for the former. Hence it should out its focus on the development of new technology. However, the relationship with Asahi should be maintained so as to aid Corning in having a quick entry into the market after the development of the new technology.
Further discussions will be held at the board meeting.
Reference

Corning, Inc.: A Network of Alliances. (n.d.). Retrieved March 21, 2016, from https://hbr.org/product/corning-inc-a-network-of-alliances/an/391102-PDF-ENG

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