The objective of this report is to evaluate the strategy and performance of Wilkhahn Asia
Pacific (WiAP). The focus will be on the business-level strategy. An analysis will be
conducted to identify if a match between the strategy pursued by WiAP and the internal and
external environment exists. Subsequently, we will synthesize the information gained from
the analysis in order to identify possible proble ms and generate alternative strategic solutions.
Finally, we will offer recommendations to WiAP on future strategies based on an evaluation
of the strategic solutions.
WiAP is a subsidiary of the German multinational commercial furniture manufacturer
Wilkhahn GmbH. WiAP started its operation in Australia in 1999 with its regional
headquarters in Sydney and sales offices in Melbourne and Brisbane. The company has
grown rapidly and has recently established a presence in Asia through sales offices in
Singapore, Hong Kong and Kuala Lumpur. After the first two very successful years,
Wilkhahn Asia Pacific has recently experienced a decreased sales performance.
We have considered Wilkhahn as an interesting firm for our report, given that it is a
multinational company with presence in Australia. Given our own nationalities, German and
Swedish, we found it interesting to evaluate the performance of a northern European firm
operating in Australia. The reason we choose the office furniture industry is that one of us has
previously worked in the industry in Europe.
With the help of WiAP’s Managing Director, Michael Prenzlau, and his staff, we were able to
collect valuable information about the office furniture industry (external environment) and the
company itself (internal environment).
Table of Contents
1. INTRODUCTION
2. COMPANY OVERVIEW
3. STRATEGIC INTENT AND STRATEGIC MISSION
4. IDENTIFICATIONS OF SYMPTOMS
5. CURRENT STRATEGY
6. EXTERNAL ANALYSIS
6.1 GENERAL ENVIRONMENT IN THE GENERAL ENVIRONMENT WE HAVE IDENTIFIED THE INCREASED GLOBALIZATION OF BOTH PRODUCTS AND PRODUCTION AS WELL AS THE ROLE OF TECHNOLOGICAL CHANGE. ALSO WORTH MENTIONING IS THE RAPID GROWTH OF TELECOMMUNICATION AND INFORMATION TECHNOLOGY (IT).
6.2 INDUSTRY ENVIRONMENT
6.3 INDUSTRY ANALYSIS – PORTER’S FIVE FORCES MODEL
6.4 COMPETITOR ENVIRONMENT
6.5 KEY SUCCESS FACTORS (KSF)
7. INTERNAL ANALYSIS
7.1 RESOURCES TANGIBLE
7.2 ORGANISATIONAL CAPABILITIES
7.3 CORE COMPETENCIES
7.4 SWOT ANALYSIS
8. STRATEGIC-FIT EVALUATION OF WIAP’S BUSINESS LEVEL STRATEGY
9. SYNTHESIS - EVALUATION OF STRATEGIC SOLUTIONS
9.1 STRATEGIC SOLUTION 1: INTEGRATING TECHNOLOGY AND FURNITURE
9.2 STRATEGIC SOLUTION 2: LAUNCHING ‘OFFICE BY WILKHAHN’ LINE
10. RECOMMENDATION
10.1 IMPLEMENTATION PLAN
11 CONCLUSION
12 BIBLIOGRAPHY
Research Objectives and Key Topics
The objective of this report is to evaluate the strategy and performance of Wilkhahn Asia Pacific (WiAP), specifically focusing on whether its current business-level strategy aligns with the internal and external environment to address recent sales performance declines.
- Analysis of the commercial furniture industry environment and market trends.
- Evaluation of internal resources, core competencies, and organizational capabilities.
- Identification of strategic misalignments and potential growth challenges.
- Development of alternative strategic solutions to regain market competitiveness.
- Implementation planning for a sustainable integrated business strategy.
Excerpt from the Book
Evaluation of Strategic Solution 1:
Through the strategic alliance WiAP is able to share the risks and costs and gain competitive advantage through the combined technology. The first mover advantage allows WiAP to gain a large share of the market, charge a premium price and possibly set a standard for the new product.
This strategy allows WiAP not only to outperform its rivals, but also to redefine the basis of competition by introducing furniture with integrated technology.
Being the first mover also means that WiAP does not know how big the demand for its new product would be. They are creating a demand and consumers are not aware yet that they might need this product. In case this innovation fails, it could harm the Wilkhahn brand and the R&D costs will never be recovered.
Summary of Chapters
1. INTRODUCTION: Outlines the objective of evaluating WiAP’s strategy and the research approach taken to analyze the company's performance.
2. COMPANY OVERVIEW: Provides background on Wilkhahn GmbH and the establishment and operational structure of its Asia Pacific subsidiary.
3. STRATEGIC INTENT AND STRATEGIC MISSION: Defines the company's long-term goal of being an innovation leader in the commercial furniture market.
4. IDENTIFICATIONS OF SYMPTOMS: Identifies declining sales and pricing challenges in the task chair segment as the primary symptoms of underlying issues.
5. CURRENT STRATEGY: Details the company’s focus on a "Focused Differentiation" strategy based on high-quality product design.
6. EXTERNAL ANALYSIS: Examines the globalization of the furniture industry and assesses competitive threats using Porter’s Five Forces model.
7. INTERNAL ANALYSIS: Assesses the company's tangible and intangible resources, core competencies, and organizational capabilities.
8. STRATEGIC-FIT EVALUATION OF WIAP’S BUSINESS LEVEL STRATEGY: Evaluates the alignment between the company’s current strategy and the changing market demands.
9. SYNTHESIS - EVALUATION OF STRATEGIC SOLUTIONS: Proposes and evaluates two potential strategic paths: integrating technology or launching a downmarket product line.
10. RECOMMENDATION: Recommends the implementation of an integrated cost-leadership/differentiation strategy via the "Office by Wilkhahn" line.
11 CONCLUSION: Summarizes the findings and reinforces the recommendation for a more sustainable strategic approach.
12 BIBLIOGRAPHY: Lists the sources and references used for the report analysis.
Keywords
Wilkhahn, WiAP, strategic management, business-level strategy, focused differentiation, internal analysis, external analysis, Porter's Five Forces, furniture industry, innovation, target costing, integrated strategy, market performance, strategic fit.
Frequently Asked Questions
What is the core focus of this report?
The report aims to evaluate the strategy and performance of Wilkhahn Asia Pacific (WiAP) to understand why it has experienced decreased sales performance and to propose future strategic directions.
What are the primary themes discussed?
Key themes include strategic fit, differentiation, competitive analysis of the commercial furniture industry, internal resource management, and strategic synthesis for future growth.
What is the main goal of the research?
The goal is to determine if WiAP's current business-level strategy matches its environment and to offer actionable recommendations for improving financial performance.
Which scientific methods are utilized?
The authors employ SWOT analysis, Porter’s Five Forces model, and strategic-fit evaluation to assess the company's position within the furniture market.
What does the main body of the work cover?
It covers an extensive external and internal audit of the firm, an evaluation of its current competitive strategy, and the proposal of two distinct strategic solutions.
What characterizes the firm's strategic identity?
The firm is characterized by its intent to be an innovation leader in the commercial furniture market, maintaining high-quality design despite evolving customer preferences.
Why was the 'Office by Wilkhahn' line recommended?
It was recommended because it represents a more feasible, lower-risk solution that allows the company to defend its market position while countering low-cost competitors.
How does the report address the issue of product copying?
The report acknowledges that patents are often insufficient and costly to enforce, suggesting that the firm should focus on market-based counter-strategies like launching a more accessible product line.
- Quote paper
- Silke Tischendorf (Author), Marion Enander (Author), 2002, Wilkhahn Asia Pacific - A strategy and performance evaluation of an international commercial furniture company, Munich, GRIN Verlag, https://www.grin.com/document/15052
