Electrolux Assignment over Strategy
Question 3: Identify the main factors about the strategic position of Electrolux. List these separately under environment, capability and expectations (see section 1. 3. 1).
In your opinion which are the most important factors? From an environmental point of view Electrolux is located in a few states around the globe, which is necessary to produce with lower costs but has also a very high coordination effort.
Seen from an economic point of view it is very important to save costs where it is possible, for example to produce in Sweden and to sell products in Brazil is usually not the best ay to manage it because of the high costs in personnel in Sweden and the transportation costs. What is a problem for Electrolux is the fact that they produce products that will be waste in the future and therefore they will have to plan what how these products can be recycled in a clever way. The capability is very good, as it seems to me after reading the text.
The human resource programs seem to be fitting and personnel is the most important thing.
You can have the best machines, but if nobody knows how to operate them you still have nothing. The stakeholder xpectations are very important. As I know from having shares of different companies for myself, I first of all want a good dividend. And if a company will have to tell me that they cannot pay me a good dividend, I want to see why and what is done to improve the situation.
In the text you can see that Electrolux is removing a plant from the US to Mexico what will help to save costs but will also be expensive at the moment of the decision because of building a new plant and moving from Greenville to Juarez.
The most important factors for me are the staff, the staff and the staff. When I have great knowledge inside my company I will have to problems to cope with different situations and this will help to be a good competitor on the market and as a result of that I will have enough money to invest and pay good wages.
Good wages will help to keep my staff and improve the knowledge. This will secure the future for my company. Question 4: Think about strategic choices for the company in relation to the issues raised in section 1.
3. 2. The strategic choice of buying other companies like Zanussi, Poulan/Weed Eater and AEG Hausger¤te is a very important fact to ensure the future ompetitiveness. The knowledge of these companies will be part of Electrolux and will help to ensure the development of new products. It also helps to diversify the price strategy.
It is possible to let the brands stay alive, reduce the costs in the background and share the knowledge. The prices for one and the same product, for example a washing machine, can be very different even if it is the same producer. So Electrolux can produce more and open up more market segments. Question 5: What are the main issues about strategy into action that might determine he success or failure of Electrolux’s strategies? (Refer to section 1. 3.
3. ) To ensure that strategies will be overtaken in the future is a very difficult point.
First of all you have to have a good process where the responsibilities are clear. After having a good process you will have to relationships and organizational structures. Bureaucracy can be a banana skin on the way to excellence. Improvements will not be possible to implement in the future when there is no chance for your staff to handle the work amount.
So check your resources before you plan to change things. Here we also ave the problem of the financial sector, you cannot plan something that is too expensive, for example the problem of too less electricity in China.
You will not solve that problem through building a new energy plant in the neighborhood. The last point is the acceptance of your people. You can plan a lot of improvements but if these points will worsen up the situation for your staff, you will face trouble.
In the text it is mentioned that in the plant in Nuremberg in Germany they had a strike, because of the plans to close it. Therefore the improvement for Electrolux is a very bad situation for the staff in Germany.