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From Free Lunch To Black Hole Credit Default Swaps At Aig Harvard Case Study Solution

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From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Solution and Analysis


Introduction

Historically, the company's core consumers include the Original Devices Manufacturers (OEMs), which utilized to offer From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Help items withtheir own brand name. Its customer circle consists of Original Devices Manufacturers (OEMs), who utilized to offer Company items with their own brand name. He repositioned Business as a global brand name and informed his divisional managers to comprehend marketing and its importance.

Problem Declaration

Enterprise's shift from an item based to a marketing business is not going as smoothly as planned.Overcoming the hesitation of divisional supervisors to incorporate marketing effectively is still a significant obstacle. Producing a constant brand identity throughout the whole world and employing marketing methods that finest fits the regional culture is no simple task.
Executive Summary
Situational Analysis

Yun had a rather clear picture in his mind about how From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Help can transform from a low end to a high end product company. He knew that improvement can only be done through positioning Venture as a company offering high-end items and this could just be done through high level of marketing.

In spite of having a clear vision about how to build Enterprise brand, with a potential assistance of its executives, Yun faced a number of marketing obstacles in early years of its efforts.

Among the marketing difficulties for Yun was the perceptions of executives about the value of marketing. They thought about marketing and selling as exact same tools and thought that quality products do not required marketing for increasing sales. As their focus towards marketing was rather low in their previous business practices, and the existing marketing requirement was too much high, the gap was too broader and to fill this space with incorrect perceptions about marketing was rather challenging for Yun.

Along with it the product range of the business was increasing with the ripening of new item ideas by the R&D sector of Enterprise. Yun had a difficulty to carry out marketing planning and to produce marketing spending plans for existing as well as for brand-new items from the very start, and this would take a big time.

A big shift would be required in existing marketing expenses to develop the Venture brand. This would result in increased marketing expenses for Business and might interrupt the administration relating to increased costs, as they were hesitant to marketing expenses previously and a sudden big shiftwould make them interrupt.

Internal Analysis
SWOT Analysis
Strengths


Organization strengths lie in its substantial product portfolio. Venture has biggest variety of patents in the market with total variety of 15499 patents approved in United States( USP). Big amount of R&D spending has actually made it possible for the business to grow its product portfolio at a greater rate than its competitors. From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Analysis spent about $13.079 billion on its R&D sector in 2016, which is 7.3% of its total incomes.

Another strength of From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Help is its ability to establish innovative items at a continuous rate. It significant proves for the innovation and item developing of Org is that the company has actually received many awards for its innovation and product style.

Unlike Apple and other rivals, Company is concentrated on producing devices which can be easily incorporated with any kind of open source Operating System (OS) and software application. This offers Corp an edge over Apple devices.
Porter's 5 Forces Analysis
Org's ability to produce high end products at low expense of production is likewise among the major strength of Organization as it makes it possible for the business to catch more market by providing quality items with cost control.

Weaknesses

From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Solution weaknesses are hidden in the company's dependence on outsourcing software application for its gadgets due to company's failure in developing software, unlike Sony. Venture likewise has low earnings margins as compare to Apple due to huge distinction in the rates of Apple and Corporation with a much lesser distinction in quality. The varied focus of the business due to a great deal of items in its portfolio, result in the less efficient production and make the company unable to charge higher costs like Apple. The company is likewise ineffective in managing its patents and often deals with the problem of patent infraction.

Opportunities

Opportunities for From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Help lie in the growing Smart device market and the company's efficiency in the market. Corporation presently runs in about 80 nations and the company has a chance to increase its geographical expansion by moving towards more emerging markets outside Asia.

Hazards

The dynamic industry environment of technology industry present a serious risk on Company's survival and force the company to spend much of its profits share on R&D in order to endure in the long run. The marketplace saturation in industrialized countries i.e. saturation of mobile company is likewise a big risk for the company's development in the existence of strong rivals like Apple.

4 P's of Marketing
Swot Analysis
Item

From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Analysis provides quality products and has a rather rich portfolio which deals with different sections. Most of the items are in the top 3 of their respective markets. LCD and cellphones are the most significant products of Organization, whereas DRAM is likewise not far behind in comparison of them. Following is the product line of Venture:

• LCD/ TV
• Laptops.
• Smart phone.
• A/c unit.
• Computer.
• Hard drives.
• Washing machines.
• Fridges.
• Cams.
• Microwaves.
• Flash memory.
• DRAM.

Price.

From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Solution uses both market competitive and market skimming pricing strategies for its wide range of items. In competitive pricing it adjusts the cost according to the competition in order to acquire advantage, whereas, it utilizes market skimming method where the product has an added worth and by selling a few items it can reach break-even.

Place.

It has one of the best supply chain networks, with retail suppliers, their own sole suppliers, E commerce channels like Amazon and so on. All its products are timely provided to the selling place/ provided to the clients directly in case of online order.

Promotion.
Vrio Analysis
It wasn't a popular company outside of Korea up until 1993. The management effort taken by their CEO has actually pressed them to market more efficiently outside the borders and now it has actually gone into the league of leading 25 business in the world in simply 9 years. This is an impressive accomplishment regardless of the ongoing arguments among the supervisors about embracing marketing practices. It utilizes both offline & online channels of promotion to market their products. Paid product ads, social promotion and digital ads are utilizes to produce awareness about Organization items.

Worth Chain Analysis.

It's an analytical framework for determining service activities that include value or competitive advantage for the business.

Incoming Logistics.

For its incoming logistics it owns various logistics companies as it subsidiaries. It looks after its providers and develops an unified relationship with them and even lowered their payment cycles to boost this relationship even more which includes worth to their chain network.

Operations.

Corporation's core competency is its mass making it produces 90% of its products in-house. Divided into 3 different departments its operations are namely IT & Mobile Communications, Gadget Solutions and Customer Electronics. It is maintaining operation hubs worldwide to further add worth to its worth chain network.

Outbound Logistics.

Its outgoing logistics system efficiency is among the main reasons From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Analysis has the ability to compete with Apple. Company's own Electronic Logitec system plays a major role in the outbound logistics operations. It even performs the tasks of collection of payment, settling insurance claims, etc. on behalf of Corp.

Marketing and Sales.

Bring in target consumer attention towards the product is done through marketing and sales to interact with them the value and competitive advantage the product uses. From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Analysis marketing spending plan is constantly on the rise since they began their repositioning internationally and will continue to do so as they are constantly aiming to invest and expand in high prospective growth markets. The spending plan is spent on events, print and media ads, public relations and so on.

Organization put their consumers at the leading and constantly strive to deliver unmatchable client service standards. By adding a direct assistance line to call them 24 hours they have even more increased the included value of Business service.

Segmentation.

From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Analysis has actually diversified market segmentation, based upon its provision of large range of items to large number of consumers. Corporation target customer sectors can be divided into 3 categories i.e. From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Analysis IT and Mobile Communications, Company Consumer Electronic Devices and Enterprise Device services.

Geographical.

From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Help geographical segmentation is based upon two requirements i.e. area and density. Corporation serves about 80 nations worldwide with its products supplied to Urban along with Backwoods of the nation. The Organization is likewise growing its global existence and the business's flexibility in finding its plants encourages international expansion of Enterprise.

Group.

The market segmentation of From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Analysis is based upon gender, age, life-cycle phase and occupation. Corp produces products that can be utilized by both women and males. The target customers for Venture IT and mobile communication products have an age variety of 18-65 with bulk at a young or newly wed life process stage. They are mainly students, employees and specialists. Apart from it, Corp Consumer Electronics are targeted to a client sector with an age range of 25-65. They are mainly experts and workers. Enterprise Device Solutions are targeted at students, workers and experts with an age variety of 25-65.

Psychographic.

The psychographic division of From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Solution s based upon the social class and the life style of the customer. Corp target customers on the basis of social class are generally upper middle, middle and working class customers, as Corp sell products like cell phones not much more affordable i.e. Motorola as well as not much pricey i.e. Apple. It provides quality items to middle level consumers at a somewhat high rate than others targeting the same section.

Behavioural.

From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Solution majority target customers have unique behavioural qualities. It has clients with an ambitious, stylish and figured out personality with moderate level of loyalty towards the brand. Its consumers have some degree of shift towards other renowned brands i.e. Apple. Most of Organization customers desire quality as well as expense control. They are drawn in towards Corp since of its moderate prices with an extent of quality.

Quantitative analysis.

Sales of From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Solution has increased astonishingly from 16 billion $ in 1997 to 44.6 billion $ in 2002, and the net revenue of.48 billion $ to 5.9 billion $. Digital media is the largest selling classification of Enterprise with sales of 13.9 billion $, whereas, Telecommunication and Semiconductors sectors both reached 11 billion $ in sales.

Qualitative analysis.

Yes, this decision is based on the mission of Kim to target the younger audience and create an international brand name picture of the company. Whereas, the core strength of the business is presently producing however long gone are those days when excellent items were selling themselves. In the current age marketing is really crucial and companies can not be successful without it. Kim has actually already started to strengthen the marketing activities of Corp and soon it will turn into one of its core strength like producing if not much better.

VRIO.

Value.

Organization runs designs, manufactures and offer a vast portfolio of consumer electronics. It operates in a very competitive environment and has effectively positioned itself as the maker of quality items. The response is yes.

Rarity.

As, said earlier that From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Analysis operates in a highly competitive environment, which suggests all the companies have similar items. The response for rarity is no.

Imitability.

Due to the nature of the market, it is extremely simple for competitors to understand the performance of the items and quickly make their own designs. Yes, Enterprise is only behind IBM in signing up new patents every year, but the benefit is very short-term in this market.

Organization.

Chairman Lee has totally turn-around Business, from going practically insolvent during the Asian monetary crisis of 1997 to the top 25 business on the planet. Absolutely yes there appertains organization in the company and the outcomes promote themselves.

External Ecological Analysis

PESTLE Analysis

Political

Being an international brand name spread nearly in every nation worldwide, majority of the environments like USA, Europe, China etc., are extremely conductive for its operations. Nevertheless, it deals with some political pressures in less industrialized countries where order circumstance is bad. Latin American, African and some Asian countries fall in this classification, where political instability do have an effect on From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Solution operations.

Economic

Buying power of customers is crucial for companies like Venture to grow and succeed. Emerging markets like India, middle-eastern countries and so on offer growth opportunities, whereas, due to recession even the clients of developed nations suffer terribly. It is really crucial for the business to keep an eye on the ongoing financial circumstance of the country before entering the market.

Socio-Cultural

Multinational business need to face various social and cultural issues throughout its operations in a foreign nation. Organization has also faced numerous concerns however have actually adopted to the regional environments of the majority of the countries incredibly well. It has customized its items, practices, policies etc. accordingly in order to be successful.

Technological

With a yearly expense of 2.4 billion dollars in Research & Advancement, and with constant ingenious product launches, From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Solution is one of the top innovative companies of the world. With a clear objective to be ahead of the rest when it comes to technological improvements, Enterprise has increased to the no 25 of the top effective business of the world.

Legal

Each country has their own laws and policies, being a multinational company Venture need to strictly follow those laws in their jurisdictions. Failure to do so, will result in severe legal effects. It has to study or employ a regional law professional prior to beginning its operations in a particular nation.

Environmental

With the increasing awareness among consumers about the ethical & environmental violations of companies, Business has to guarantee that it follows all the safety standards. Ecological damages, ethical misconducts are not acceptable and in some nations the consequences can be really serious. On the other hand it has to do some Business Social Obligation practices to reveal the locals that it cares about their environment and individuals.

Porter's Five Forces

Risk of Replacement

Threat of substitution for Enterprise's each product category is rather significant. Factors for high danger of substitution for From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Help Smart device include the presence of high number of providers and Market saturation in developed countries, which make the cost of switching for consumers practically no. Along with it, Organization printing solutions items are threatened by the increasing attraction of clients towards cloud storage.

Rivalry Among Existing Companies:

The rivaly amongst Business and its close rivals is intense. The major reason behind this is the method of market saturation in different number of item categories, requiring Organization to introduce more ingenious functions in existing items and brand-new innovative products to maintain its growth. The significant rivals for From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Analysis samrtphones consist of Apple, Motorola, LG, Nokia, Huawei, OPPO and so on.

( Org Sustainability Report, 2016) Supplier's bargaining power for Venture is low as Company runs economies of scale and its orders are of potential size and worth. Due to incapability of From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Help to build its own software application, it has to outsource its software application development to Google, which ends up being a possible supplier of software for Venture, resulting in high bargaining power of Google.

Bargaining Power of Purchasers:

Negotiating power of buyers for different number of item classifications of Business is extreme. One of the factor leading to the extreme bargaining power is the schedule of a great deal of competitors in practically each item category i.e. competitors of Company Smart device, with a really little distinction. The high availability of providers of Mobile phones with minimum distinction, make the switching expense for buyers nearly zero, for this reason increasing the bargaining power of purchasers. Market saturation in the majority of the product classifications likewise make the bargaining power of buyers more extreme in for From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Solution. In spite of igh bargaining power Corp is quite capable of selling its items at a greater rate than much of its rivals, due to high-end quality product and a reasonable brand name image.

Threat of New Entrants:

Danger of brand-new entrants for From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Analysis is rather low. Along with it, requirement of substantial proficiency and research and development expenditures for survival in the market likewise make brand-new entrants unwilling to enter in the market. Market saturation is likewise one of the barrier of entry in technology market.

Competitive Analysis

Company's high item diversification offers it distinction from its rivals. It is one of the 3 top brands by market share. Unlikely to its close rivals including Sony, Intel and Nokia, who focus bulk on a single item classification with Sony concentrating on customer electronic devices, Nokia on cellular phone and Intel on chips, Enterprise had a huge R&D spending on all of its product classifications which make it possible for the company to earn possible income from sales of practically all of its products. (See Exhibition) However, due to the wide product range the company deals with high variety of rivals.

The company ranks first in 4 product categories i.e. DRAM Chips, LCD Displays, Big Screen TVs and Microwave ovens, in regards to global market share, amongst 8 different product categories. Organization was the global leader in producing DRAM, SRAM and NAND flash chips. Org revenues from chips was less than Intel however its earnings from chips was growing faster than Intel and has grown close to the income levels of Intel, as offered in the case Exhibition 2.

Along with the chips Business mobile market was likewise thriving at a high rate than its competitors i.e. Motorola and Nokia. Venture's cellular phone's sales development was 51% as compare to Motorola with only 4% and Nokia with absolutely no sales growth. The major reson behind Organization's high growth despite of greater costs than Nokia and Motorola was the business's high-end quality cellular phone.

Enterprise was likewise profiting from increasing market share of luxury LCDs as given up case Exhibit 3. The major factor, making the business allow to avail the opportunity is its mass production at low cost. Sony was the most significant rival for From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Solution in LCD market, however, it had likewise started joint endeavor with Company in 2003 for LCD manufacturing, decreasing the competitors for Corporation.

Porter's Competitive Technique

Low Cost Management technique of porter is completely implemented by Company the method they attain economies of scale by reinforcing their core competencies of production. They constantly bring something brand-new and innovative whether it's a product or a service.

Alternatives

Alternative Solution 1

The Chief Marketing Officer (CMO) of From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Solution would produce a new brand name image by targeting the younger generation of the specific nation. As, particularly cellphones of Company are incredibly popular amongst the younger demographic.

Pros

1. It is the best method to develop Customer Life time Worth (CLV) by creating a long-term relationship with customers. Build commitment through providing worth and reap the benefits for long-term, as research has showed it is more affordable to retain existing consumers than to attract new ones.
2. Another pro of this option is that word of mouth spread faster among more youthful individuals and which in turn will generate brand-new consumers for my products.

Cons

1. Old customers who were associated with Org before may not like this brand-new image the company is attempting to represent.
2 It will sustain further expenses to rearrange some items and it may not even bring success as the patterns alter really quickly amongst the younger demographic.

Alternative solution 2.

Corp has made making its core proficiency for the most part of their business and due to which its supervisors are not scared to fully get out of their convenience zone. It would be done by setting up training workshops during which value of marketing will be taught and numbers will be given. Failure to get the passing scores will get demoted. Marketing environment must be developed internally first as genuine marketing starts inside the corporation.

Pros

1. Its pro will be that all the marketing approach fans will come out and likewise the opposite ones.

Cons

2. Its con can develop an extremely unhealthy environment in the work environment, as people often resist modification due to the fact that they fear it.

Identify the very best option

Very first option is the best as it plainly has more pros because once a Consumer Lifetime Worth is built the business will benefit from it till that consumer is alive and has purchasing power also. Plus, our target clients are the younger generation which are bound to live longer than the existing old age people. Corporation's main objective is to produce commitment among its clients and make them redeemed it from them and even purchase their various products.

Application Strategy

• Targeting more youthful generation through social marketing, developing a link with them like Pepsi do with music. And set the expectations achievable and realistic.
• A group including finest marketing and sales specialists need to be assemble, and both views ought to be considered prior to securing the resources needed to implement the strategy.
• Thorough interaction of the plan need to be done as it is very important for everyone to be on the same page to make it work.
• Jobs and timelines must be develop and communicated appropriately to each individual responsible.
• The manager ought to utilize a dashboard which reveals the development of all the tasks which have actually been done or about to be done and by whom.
• The manager ought to keep track of and keep a continuous examine the private and total performance.
Because any new trend or policy may come in due to which all the things already prepared have to be adjusted, • Everyone must be ready to adapt midway. It's better to have contingency strategies currently prepared.
• At the end of the campaign the supervisor must interact the outcomes and if successful must celebrate with the team.

Spending plan

This change the budget allocation of different countries and many supervisors were dissatisfied and argued but the analysis done by the program was precise and revealed figures like North America and Russia development potential warranted a 35% allocation while they were receiving 45%. It actually helped to relatively distribute the resources and capture more customers by spending more on ads on the high development capacity areas of the world.
Recommendations
Conclusion

From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Analysis is a leading 25 company on the planet now and plans to get ahead of Sony who sits currently at no. 20. Its constant financial investment in R&D and innovative practices have actually moved them to new heights however for them its' only the start and they wish to be among the leading 3 brands worldwide. They totally turn-around from nearly going bankrupt throughout the Asian Financial Crisis to a world prominent brand, understood for quality and innovation. Their value chain and their core proficiency their production capability, along-with international brand image building have actually seen their sales go from 16 to 44.6 billion $ from 1997-- 2002. With more growth in China and other emerging markets those numbers will only increase further in the future. Their marketing efforts should be directed towards younger demographic in the middle of the internal arguments about marketing and should create Client Life time Value as it will not only give them advantages now however will continue to enjoy it till the consumer lifetime. As the expense of maintaining the consumer is much cheaper than bring in a new one.