Electrolux AB: Managing innovation Case Solution
|Ø The technology of the internet of things (IoT)
Ø Electrolux has grown through mergers and acquisition
Ø Large number of distributors
Ø Variety of products
Ø Manufacturing was localized
Ø Electrolux had a diversified geographic presence
Ø Product durability (ruled the mid market in Europe)
Ø Electrolux started relocating production to low-cost countries
Ø Innovation Triangle
|Ø Imminent take-off would be (ongoing revival of the global economy)
Ø Trend that influence the ongoing strategies of the company
Ø Ensuring transparency
Ø Collaboration between different functional departments
Ø Lack of openness and free sharing of ideas (effect on organizations’ culture)
The technology of the internet of things (IoT)
The power of the team was Technology of Internet (IoT), the key variable which was use to interface home apparatus with advanced cells, keeping in mind the end goal to give the favorable environment to workers and additionally to support deals or to boost up the sales.
Mergers and Acquisition
Electrolux was the merger of two Stockholm-based organizations Elektromekaniska and AB Lux. This was likewise the strength of the team with a specific end goal to share chance and also rivalry from outsiders. Acquisitions were the key portion of its development as the acquirer of Compañia Tecno Industrial S.A (CTI) of Chile in August 2011 and Olympic Group of Egypt in September 2011 gave Electrolux the primary position in the development of Latin America and the Middle East. In 2012 because of securing Electrolux was preparing 70 per cent of its incomes from outside Europe.
Number of Distributions:
The organization's gathering operations included of the various fragments made by its dealers. Its esteem included procedures incorporate metalworking; embellishment of plastic, print and enameling and for all these vast assortments of work Electrolux required a massive number of wholesalers and because of this reasons Electrolux retained its things through an overall arrangement of independent distributors.
Variety of Products and Localized Manufacturing
Organization had the full range of items, and every segment of the business had an obligation regarding creating benefit. Organization had localized manufacturing that would help the Company to meet the needs of the Company as many as possible.
Diversified Geographic Location
Electrolux had a broadened geographic nearness and having producing offices crosswise over 19countries; it implies organization had the vast assortment of clients in various nations that help an organization for expanding benefits. Item strength was another element for expanding the income and accommodating in picking up the trust of customers.
Production to Low-Cost Strategies and Innovation Triangle
Electrolux started relocating production to low-cost countries (strength), which make it easier for a company to expand globally. Innovation Triangle was another quality that would help an organization for enhancing the outline of the item by developing innovative work (R&D), increment product offering broadly and all around.
Electrolux's products were accessible around various nations, and have the broad range of items. However, the shortcoming of the organization was the absence of original things, because of these reason competitors like (Keith McLoughlin) control over its new part in January 2011.
Organization was working in various nations; each nation has a distinctive pattern, culture, standards and esteem, so it's troublesome for an organization to full fill diverse needs and requests of clients. The absence of comprehending distinct patterns and culture of nations is the significant shortcoming of the team.
Another weakness of the Company was to need in guaranteeing the transparency. Company's agenda was to provide qualitative product and services across the world. But the company was the lack in giving those subjective (qualitative) items. Guaranteeing transparency was troublesome for the organization as a result of various practical and geographic territories over the world.
Collaboration between different functional departments
Shortcoming between the functional areas was another weakness of the Company. Favorable items were not created according to the prerequisite or requirements of the buyers: As illustration is given for the situation: The dryer worked in a fascinating innovation that lessened or even wiped out the need to iron. Regardless of its market potential, the tumble dryer did not work out quite as well as it could have because useful divisions couldn't team up to come up with a standout design and a robust campaign for conveying its real advantages. Due to this reasons, customers were unwilling to buy the products because of lack of trust over the company.
Openness and Free Sharing of Thoughts
The absence of openness and free sharing of thoughts was another shortcoming that influences the way of life and environment of the organization. Workers and clients were losing confidence towards the team due to an absence of comprehension the way of life. It's vital for the development of the team to guarantee the elements of all the department and increase collaboration between the customers, all things considered, business will profit by the learning's of each other (workers)....................................