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Assignment 1
Great Lakes
Professor Mary May
Bus 499

When analyzing the article “Great Lakes, Great Decisions” the six factors that are used are technological, demographical, socio-cultural, economic, political, and global. The technologically that is available is starting to leave the company behind. The article stated that some countries had not yet switched from leaded to unleaded gasoline for their cars and machinery. When the new technology is used this could leave behind some of the current customers and cause the company to lose money in the short term. The company will have to consider this when they are deciding what technology they will use and which they will skip.
The largest factor’s that has impacted the Great Lakes project is the demographics and socio-cultural issues. Octel’s customers are located around the planet and from all different kind of backgrounds and economic groups. The countries that these people call home could be third world or they could be highly developed. The income distribution is wide. They do not have a stable middle class. The socio-cultural concerns are the driving force for the other five factors. When governments begin taking on the mentality and values of its people they will begin leaning toward “greener” processes which could cause the company to lose more customers. Without changing the processes and the products being offered the company could be left behind. The company will lose its market and will not sell as much leaded gas because its customers will prefer the safer alternative.
The “Great Lakes had no competitors” (Mead, Wicks, Werhane p.157) They were the company that dominated the market, setting the rules and trends. The customers they targeted still used leaded gasoline and did not have the infrastructure to change. They faced a huge decision because their biggest profit came from the most harmful product. Reducing the amount of leaded gasoline being sold would great effect the profit margin the company was able to produce.
On the political side, the environmental groups were the loudest against the company. The lead additive was greatly criticized. They were urged to change their policies even though they were not breaking any laws. Leaded gasoline was permitted outside the USA. Making a decision that would result in huge reduction in profits and most likely prevent the company from being top in the industry but would keep to the company’s vision was extremely difficult.
Speaking globally, Great Lakes was tops in the market for the lead additive. This is changing due to the combination of pressure from the environment groups as well as less need for leaded gasoline in developing countries. Everything has a shelf life and as cars that use leaded gas get older they will eventually get to a point where repair is not possible. The more this happens the less leaded gasoline that is going to be needed because the replacement does not use leaded gas. This is also changing because the company is selling 8% less of tetraethyl lead. The only threat to the market position of the company was itself. The company had to deal with the bad publicity from environment groups for selling leaded gasoline or reduce the sell of the lead additive and cost the company profit margin. Such huge success from selling leaded additive was making the company vulnerable to attacks by other companies as well as the environment groups.
Four of the five forces greatly impact the additive industry in the USA. The threat of new entrants is the only force not to impact the industry simply because any new entrant would not lean toward the lead additive market. This market is no longer a growing market in the USA due to the environment groups and laws that do not allow as much lead additive to gasoline as before. The bad publicity from environmental groups would pose a huge problem for a new entrant into the industry. The media plays a huge role in keeping the industries issues in the forefront of everyone’s mind. Corporate unethical behavior and the health issues from the additive is leading people to finding new ways of doing things. The amount of capital needed to overcome the media as well as the groups would be so large that any new firm would chose to go a different direction. The bargaining power of suppliers is a low risk because there is only main supplier. Octel has dominated the industry for years and years because of their financial stability and capital. The other major marketers of this product were phased out in 1986 when the USA stopped allowing the product to be sold. The other major producers went on to other products while Octel continued to make leaded gasoline. With the competition down, Octel grew and took over the industry. The bargaining power of buyers a low risk as well due to a lack of competing products on the market. With no other products that were similar to the product of Octel there was no chance of buyers making companies compete for the business. The threat of a substitute product is a risk to the industry. As technology becomes a larger force in our world there are better ways for things to operate. The one thing that has been a constant for years and years is the internal combustion engine. This machine has had very little technological advances to its main way of functioning. With this in mind, Octel grew and owns 90% of the industry and because of the environment groups and the new laws a new company will not begin operations in America. As more and more companies use more unleaded gasoline or find different hybrid ways of operating cars and machines, Octel’s strangle hold on the industry will begin to loosen. Perhaps, as reforms begin to take place in developing countries the lead additive business will face increased competition from unleaded gas. The last threat of intensity of rivalry among competitors. This industry has no visible threat to this company. They are the main supplier, they make billions of dollars each year and there no chance of new companies starting up to force a price reduction. The company is currently number one, and future developments will determine whether the company will choose to pursue more environmentally friendly products.
This company, as stated before, has no immediate competition and more than likely no future competition in the leaded gasoline industry. They control 90% of market and flourish financially. All companies operating in the industry in the USA have opted out of competition in this field with this company. This is due to the high level of environmental repercussions making the threat of new entrants low. Any new competitor that appears would need to be in a foreign land and be large enough, with enough capital to weather the storm of bad publicity due to the product.
Great Lakes uses TEL in a lot of its products. It is used in a variety of other specific products such as water treatment, specialty household cleaners, flame retardants and chemicals used for agriculture. Also, Great Lakes have non-bromine businesses the main one being - recycling of agricultural waste into a metal producing chemical.

References
Hitt, Michael, Ireland, Duane, & Hoskisson, Robert. (2009).Strategic Management:
Competitiveness and Globalization, Concepts and Cases. Mason: Cengage Learning.