Presented by:
Nitin Kumar Shukla 2013180
Prakhar Swami 2013204
Rajat Garg 2013226
Rohit Jain 2013242
Sidhartha Dipankar 2013281
Umang Warudkar 2013309
Erika Elisabeth 2013344
Zwick Electrical:Developing A Global Logistics Strategy
Presented to:
Prof. Arijit Mitra
Zwick Electrical: The journey so far……
1952 yearZEI began operations produced
electric motors and parts
1968 yearPurchased ELTP and retained
distribution center and engineering department
1984 yearNew plant and distribution
center in Greenville
1960 yearZEI added production facilities
in Cincinnati, Ohio, and Louisville, Kentucky.
1970 yearCincinnati and Chattanooga
plants were expanded
1990 yearRenovate Shreveport and
close Cleveland, Louisville
199019841970196819601952
Problems
Overseas Venture Management
Go Global
Yes
How?
How much?
No
Alternatives
Q1. At what stage of global operations are ZEI, ABB and Siemens?
ABB
Level: Internal operation
Merger of Asea AB and BBC Brown Boveri
4 Business Segment in 3 region
Subdivided into BAs
Abacus(ABB’s MIS)
3 managerial levelBA manager
Country manager
Company manager
Siemens
Level: Denationalised
Presence in Europe, America, Asia
Corporate structure is divided into 3 primary divisionsGroups
Regional units
Corporate division and centralised services
Zwick
Level: Arm’s length
5 production plant
2 distribution center
OVM acts as a representative for ZEI in Europe.
Q2. Beyond a simple sales perspective, why might ZEI want to consider greater international activity?
Risk“Do not put all your eggs in one
basket”
Brand recognition Cross-pollinationGlobal + Local
Prestige CP
Risk
Q3. From a ZEI perspective, what advantage and disadvantage do ABB and Siemens offer?
Long term survival
Advanced R&D
Use of well developed
marketing and distribution
Autonomy
Downsizing
Employer employee loyalty
+
+
-
+
-
+
Q4. Alliances with ABB and Siemens are only one alternative contained in the consultants’ report. What may be the other alternatives?
Establish Alliances with Firms other than ABB or Siemens
Make Acquisition of its own . It might help achieve these primary objectives
Maintenance of zwick’s Market Access in regional Trading Blocks
Increased international sales as a percentage of total sales.
Complementary products from overseas suppliers
Look to new products and emerging markets
Address the changing economic-political environment in north America (NAFTA)
Q5. What course of action do you think ZEI should pursue?Why?
1) Increase The Product Line
a) They can come in agreement with overseas suppliers for complimentary Products.
b) Invest in R&D of complimentary and current products by benchmark Practices
2) Choose an alternate option for OVM
-Look for more efficient and profitable distributor across various markets.
3) Can go in merger with ABB
4) Look for growth potential markets in which govt. regulations are
friendly.
Why ABB?
Why ABB?
More Focused in Power Sectors
1300 Subsidiaries and 5000+ Profit Centers
Highly Integrated Information System.
Worldwide Presence-Europe,Asia America,Australia, Newzealand
Has its own Financial services
Good Distribution Network
Many Subsidiaries engaged in R&D
Why Not Siemens?
Not Much Focused in Power Sector.
Denationalized Operation
75 percent presence in Europe only
Our take on the case
• Go with option no.2 and try to make use of option 1 as a backup plan.
ABB