...ECCO A/S GLOBAL VALUE CHAIN MANAGEMENT Executive Summary: ECCO A/S is one of the most prominent player in the global shoe industry and is also one of the leading footwear manufacturer in the world. Since its inception in 1963 it aspires to produce top quality, casual comfort shoes with a perfect fit which are pleasant to wear in all weather conditions. The company s USP is top quality of its product with a coupled production of, manual and machine. The production of their leather was in-house and they had a unique direct injection technology. ECCO is a financially strong family owned enterprise and as corporation they focus on constant innovation and high quality products. They started it operations from Denmark, and in a continuous pursuit to gain a global foothold and to optimize its value chain, they have expanded their operations in Portugal, Slovakia, Indonesia and Thailand. They soon plan to invest heavily in China, to setup up a world class manufacturing unit which will cater to at least 25% of its forecasted global demand. ECCO, being a successful and closely knit family owned enterprise had a strong culture of bonding and attachment and it percolated down in the management strategies as well. They strongly encouraged that at least 80% of company s leader should come from inside the company. They were conscious of the fact that in their journey to be global leader, employees were their biggest asset and thus they invested heavily on employee trainings and career development...
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...ECCO A/S – Global Value Chain Management Reading assignment questions 1. Describe the competitive environment of ECCO and determine how well ECCO is positioned (compared to competitor) to take advantage of changes in the industry. Answer The competitive environment of ECCO is quite high due to the other of producing shoes such as NIKE, Adidas and Puma etc are the big brand as well. However, the way they positioned themselves is interesting. ECCO positioned itself to be concerned in the quality rather than fashion 2. Analyze ECCO global value chain. How well does this configuration match the drivers in the industry? Answer The ECCO value chain 3. ECCO has a fully integrated vertical value chain. What are the pros and cons of this strategy? What economic and strategic factors should be analyzed to answer this question? 4. How is family ownership affecting ECCO? Comment on the corporate ownership structure and its implications for strategy-making and implementation. What alternatives exist? 1) Describe the competitive environment of ECCO and determine how well ECCO is positioned (vis-à-vis competitors) to take advantage of changes in the industry. Use Porter’s five-forces model, the PEST model, and a SWOT analysis to explain your answer. (400 words) ECCO produces mainly casual footwear with an intense focus on high-quality production. In order to deliver the highest quality product, ECCO maintained a fully vertically integrated value chain...
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...S ECCO A/S — GLOBAL VALUE CHAIN MANAGEMENT w Professor Bo Bernhard Nielsen, Professor Torben Pedersen and Management consultant Jacob Pyndt wrote this case solely to provide material for class discussion. The authors do not intend to illustrate either effective or ineffective handling of a managerial situation. The authors may have disguised certain names and other identifying information to protect confidentiality. Ivey Management Services prohibits any form of reproduction, storage or transmittal without its written permission. Reproduction of this material is not covered under authorization by any reproduction rights organization. To order copies or request permission to reproduce materials, contact Ivey Publishing, Ivey Management Services, c/o Richard Ivey School of Business, The University of Western Ontario, London, Ontario, Canada, N6A 3K7; phone (519) 661-3208; fax (519) 661-3882; e-mail cases@ivey.uwo.ca. Copyright © 2008, Ivey Management Services Version: 2008-03-10 Despite the summer, the weather was hazy on that day in May 2004 as the airplane took off from Hongqiao International Airport, Shanghai. The plane was likely to encounter some turbulence on its way to Copenhagen Airport in Denmark. The COO of the Danish shoe manufacturer ECCOA/S (ECCO), Mikael Thinghuus, did not particularly enjoy bumpy flights, but the rough flight could not overshadow the confidence and optimism he felt after his visit to Xiamen in southeast China. This was his third visit in...
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...MGSC01 - MIDTERM CASE: ECCO A/S - Global Value Chain Management Analyze the problem Alternatives Decision Criteria Recommendation Good to have a contingency plan (backup plan) Key questions: - If I’m right so far, then what? What are the implications - What is the larger context? - What else do I know? Personal? - What alternatives do I have? - What am I missing? Goals: The plan was to build five closely connected factories over the next four years with a total capacity of five million pairs of shoes per year, serving both export needs and the Chinese market, which was expected to grow in the future. Produce the world’s most comfortable and modern footwear for work and leisure. Increase revenue to 8 billion and to 9 billion by 2013, selling 24 million pairs of shoes a year. Increase production capacity by 15% per year Product Market Focus: aim at becoming better at telling what we stand for. Value Proposition: Core Activities: produced 80% of its shoes in-house Vision – integrating the global value chain - To be the most wanted brand within innovation and comfort footwear. - Position can only be attained by constantly and courageously researching new paths, investing in employees, in core competencies of product development and production technology. 80% of the company’s leaders should come from inside ECCO. 2004 Sales Children 11% Ladies 47 Men 30 Sports 12 (outdoor, walking, running and...
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...International Management Dr. Paweł Krzyworzeka 2015/2016 Grades There are two components: Group presentations (10 points) • We are going to discuss six cases (sessions no. 2, 3, 5, 6, 7, 9) • All groups have to read carefully all six cases and be prepared to give an oral presentation (ad-hoc, at least two times during our course) based on assigned questions (see the table below). • Group can earn up to 5 points for a presentation • Groups are fixed and preassigned (see the list) • Do not prepare any PowerPoint presentation, however, you may want to write up your answers in a form of short paper (1-2 pages) Take-home exam (10 points) Session Date Topics Readings 1 17.03.2016 Thursday Introduction • Globalisation • Competitive advantage of nations Additional readings: Davies, H. & Ellis, P., 2000. Porter’s competitive advantage of nations: time for the final judgement? Journal of management studies, 37(8), pp.1189–1214. Dunning, J.H., 1993. Internationalizing Porter’s diamond. MIR: Management International Review, pp.7–15. Porter, M., 1990. The competitive advantage of nations. Harvard Business Review, 68(2), pp.73–93. 2 31.03.2016 Thursday Global value chain • Outsourcing vs offshoring • Global value chain • offshoring • outsourcing • Resource-based view • Transaction costs • Intellectual property infringement Case: Ecco – Global value chain management 1. Describe the competitive environment of ECCO and determine how well ECCO is positioned...
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...Battle Continues 1. How did Philips become the leading consumer electronics company in the world in the postwar era? What distinctive competence did they build? What distinctive incompetency 2. How did Matsushita succeed in displacing Philips as No. 1? What were its distinctive competencies and incompetence? 3. What do you think of the change each company has made to date—the objectives, the implementation, the impact? Why is the change so hard for both of them? Case 2 ECCO A/S Global Value Chain Management 1. Describe the competitive environment of ECCO and determine how well ECCO is positioned (vis-a-vis the competitors) to take advantage of changes in the industry. 2. ECCO has a fully integrated vertical value chain. What are the pros and cons of this strategy? What economic and strategic factors should be analyzed to answer this question? 3. Is ECCO following the inside-out or outside-in strategic perspective? What are the implications of this choice and how can ECCO increase their sales/marketing...
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...ECCO A/S – GLOBAL VALUE CHAIN MANAGEMENT | | Report submitted by:Abhas Mangal (GAPR11IT038) | | Contents Executive Summary 3 Company’s Profile 4 PORTER’S FIVE FORCES STRATEGIC ANALYSIS 5 Outcomes of Porter’s Five Forces 5 SWOT ANALYSIS 6 Evaluation of Alternatives 6 Recommended Strategy 7 Executive Summary ECCO, a global manufacturer and a supplier of shoe products, wants to expand into the Chinese market to increase its export to major markets and also increase product sales among Chinese consumers. But many Chinese manufacturers imitated the product design and features of ECCO increasing the intense competition for the company in the Chinese market. Also, ECCO for years has a sole focus on increasing the quality of the shoes manufactured by using its sophisticated in-house “direct injection” technology. But the company cannot only thrive on its quality unless the company’s efforts to ensure quality are not communicated to the consumers. Thus, the company focused less on marketing operations that is evident from its low marketing budgets as compared to its competitors. Also, the most of the products manufactured in four production facilities outside Denmark were distributed through its distribution centre in Tonder, Denmark where only six to nine percent of total production was actually sold. Thus, ECCO became inefficient to fulfil the replenishment orders that had to be delivered within a few days notice. Thus, the main challenge for ECCO is to...
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...-The competitive environment of ECCO is quite high due to the other of producing shoes such as NIKE, Adidas and Puma etc are the big brand as well. However, the way they positioned themselves is interesting. ECCO positioned itself to be concerned in the quality rather than fashion 1) Describe the competitive environment of ECCO and determine how well ECCO is positioned (vis-à-vis competitors) to take advantage of changes in the industry. Use Porter’s five-forces model, the PEST model, and a SWOT analysis to explain your answer. ECCO produces mainly casual footwear with an intense focus on high-quality production.In order to deliver the highest quality product, ECCO maintained a fully vertically integrated value chain situated in various countries leveraging local expertise.Because of this unique situation, competitors found it very difficult to sustain a comparable level of quality. As noted in the case, ECCO finds itself in a highly competitive industry. The primary competitors identified in the case are: Timberland, Clarks, and Geox. For a brief analysis of the strengths of each of these competitors, please refer to Figure 3.As ECCO has recently entered the golf shoe market, they also face stiff competition from firms such as Nike, Rebok, and Adidas. ECCO stands in a unique position among the competitors in that it is the only non-branded manufacturer.The primary competitors of ECCO identified in the case outsource the majority of their manufacturing then uniquely brand...
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...12 3. PURPOSE 12 4. CONTENT 13 5. EXTENSION AND SIZE OF GROUPS 13 6. SUPERVISION 13 7. DEADLINES 13 ECCO achieved record results in 2011 (Source: http://www.ecco.com/en-XI/Media-Center/Annual-Report ) In 2011, ECCO achieved the highest surplus in the company’s history with a profit before tax of DKK 904 million. This highly satisfactory result was particularly due to successful new collections and improvements in sales in most of ECCO’s markets. The outcome could have been even better, if ECCO’s shoe factory and tannery at Ayutthaya in Thailand had not suffered catastrophic flooding in October with considerable human and commercial consequences. Many of the 3,500 employees in Ayutthaya lost both their home and all their belongings. Despite this, they all made an enormous effort both for ECCO, usually incompletely unfamiliar roles, and for the local community. For ECCO, the flooding meant the loss of more than a third of the company’s production capacity. The emphasis was therefore placed on quickly establishing increased production at ECCO’s other factories and among external partners. New production capacity has now been established in Thailand, and ECCO expects to be back in full production by the end of 2012. It was particularly positive that ECCO’s tannery in Thailand succeeded in restoring production as early as 1 February 2012. In 2011 ECCO increased its revenue from DKK 6.1 billion to DKK 7.1 billion, an increase of 16%. The profit before tax of DKK...
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...course site) Course Website: http://carmen.osu.edu Suggested Reading: The Economist (https://www.economistsubscriptions.com/searchstudent/us/) Course Overview and Objectives The world is changing in fundamental ways. First, the development of a truly global market in products, services, capital and even certain types of labor is changing the basic terms of competition for an array of different firms and industries. In Thomas Freidman’s words, “The world is flat.” Second, although firms have operated around the globe for many years, they are becoming increasingly integrated yet differentiated, with tightly coupled but different activities in various locations rather than replicating themselves from place to place. Understanding the interaction between culture, knowledge, and the way businesses coordinate around the world is critical to understanding both the possibilities for and constraints on managing a business in today’s fast-changing economy. In this class we will talk about why trade exists between nations, and why businesses decide to leave their familiar domestic surroundings to build subsidiaries overseas. We will examine actions and strategies of the “multinational enterprise” (global companies like GE, Toyota, and BP) that is the primary actor of interest in international business. We will discuss...
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...Carmen course site) http://carmen.osu.edu Course Website: Suggested Reading: The Economist (https://www.economistsubscriptions.com/searchstudent/us/) Course Overview and Objectives The world is changing in fundamental ways. First, the development of a truly global market in products, services, capital and even certain types of labor is changing the basic terms of competition for an array of different firms and industries. In Thomas Freidman's words, "The world is flat." Second, although firms have operated around the globe for many years, they are becoming increasingly integrated yet differentiated, with tightly coupled but different activities in various locations rather than replicating themselves from place to place. Understanding the interaction between culture, knowledge, and the way businesses coordinate around the world is critical to understanding both the possibilities for and constraints on managing a business in today's fast-changing economy. In this class we will talk about why trade exists between nations, and why businesses decide to leave their familiar domestic surroundings to build subsidiaries overseas. We will examine actions and strategies of the “multinational enterprise” (global companies like GE, Toyota, and BP) that is the primary actor of interest in...
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...|[pic] |BA 388T Strategic management | | |Section 02310 | | |SPRING 2014 | Professor Stephen E. Courter Class Time and Location 9:30 -11:00 am GSB 3.106 Office CBA 3.236 Office Hours Mondays 10:30-11:30 am and Thursdays 1:00-2:30 pm Also By Appointment Phone 512-232-3441 E-Mail Steve.Courter@Mccombs.utexas.edu Course Web Page via Blackboard Teaching Assistant Vanessa Gonzales Vanessa.Gonzales@mba14.mccombs.utexas.edu Course Objectives The traditional purpose of this course is to help you integrate your knowledge of the functional areas of business into a holistic view of the firm and thereby determine and execute proper business level and corporate strategies. Additionally, the field of strategic management has developed a number of concepts and models unique to a general management view, and designed to provide the tools to analyze the firm and its environment. A second purpose of the course will be to digest this body of knowledge, and explore real life situations in applying its...
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...exporter of wine. Gallo cultivates more than 3,000 acres in the Napa and Sanoma valleys in California. With over 60 brands including table, sparkling and dessert wines, malt beverages, and distilled products; production and distribution facilities throughout the world; and a strong international presence; E.&.J Gallo is third largest wine firm in the world, with a 3.8% market share (Global Wine Manufacturing, 32-36). Refer to chart below. Gallo is the largest wine supplier in the U.S., commanding 22.7% of the market. Also, in comparison with the financial metrics of other firms in the industry, Gallo’s profit over revenue stands at 17.09%, whereas the industry average is 7.6%. Gallo’s sales grew 7% in 2010 as a result of acquisitions and the ongoing success of its Millennial-targeted Barefoot Cellars (up 33.3%) and Twin Valley (10.3%) brands. Twin Valley is described as a “step above” boxed wine (Mintel, Wine-US). With its strong brand and competitive strategy, E.&J. Gallo Winery has been able to weather the economic recession fairly well, capturing over $3.2 billion in revenues last year (Global Wine Manufacturing, 36). Overall, Gallo is certainly a high performer within its industry. Strategy E.&J. Gallo Winery’s strong performance can be attributed to strategic factors which have enabled the firm to achieve a competitive advantage in the marketplace. Since its inception in 1933, Gallo has grown from a small family winery to a dominant incumbent through successful implementation...
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... Pietro Romano, and Andrea Vinelli MIT-IPC-05-005 June 2005 Breathing Shoes and Complementarities: How Geox has Rejuvenated the Footwear Industry Arnaldo Camuffo, Andrea Furlan, Pietro Romano and Andrea Vinelli MIT IPC Working Paper IPC-05-005 June 2005 We apply the related notions of complementarities and performance landscapes to study strategic positioning in the footwear industry. We use this theoretical framework to analyze Geox, an Italian footwear manufacturer that, in less than a decade, has grown to be one of the world largest brown shoe manufacturers, outperforming the industry in terms of market and financial results. We describe Geox’s choices within four stages along its value chain: product design, marketing and communication, production and supply chain, distribution and retail. We show that, though grounded on product innovation (the Geox breathes® patented system which allows ventilation in waterproof rubber sole shoes), Geox’s competitive advantage has not grown out of operational excellence in single activities in the business, but, rather, derives from a unique and consistent configuration of complementary activities. Such configuration represents an innovative strategic position and corresponds to a high performance peak in the footwear industry performance landscape. The case study provides anecdotal evidence in support of complementarity-based economic theory, showing how complementarities among activities help understand increasing returns to...
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...Introduction: The amazing thing about designer's footwear is that it follows the latest trend which the people want to see in their favorite store. The top designers like Thierry Rabotin shoes or Vibram five finger shoes always go for the buyer's choice of style and design at the same time. You can visit a department store or specialty stores for a variety of styles for every family member. If your time is limited, do a search on the internet where you can find a large selection of shoes to fit your needs. These websites make it very convenient for the consumer to order and it can be shipped as early as twenty-four hours. No matter what taste the buyer's has, from casual to formal footwear and from sports footwear to normal walking type shoes, there is an unlimited range that can be confusing for customers as to which one will suit them best. If the price is right, you can purchase more than one pair of shoes There are people who prefer shoes that are comfortable rather than being fashionable. Today's footwear market offers a large selection of styles that comfortable as well as being stylish which is good news for people who have foot problems. Shoe designers have provided all the latest variety in footwear that can be found online or your favorite local store. The latest trends in footwear are often seen on famous celebrities or athletes. Fashion magazines feature the latest styles as well. If you know the brand name, you can search the internet to find what is currently...
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