Competitive Strategies at Whirlpool India

Case Analysis by:

Vipin Solanki 007Ghanshyam 031Varsha Vijay 032Neha Nair 033Hari Krishan 035

Whirlpool India –A Brief Insight

• Worlds largest white goods company, status reached in 2006.

• Sales -$18billion, 73000 employees.

• More then 70 manufacturing centers.

• Entered India through a JV with TVS group.

• 1995,acquired kelvinator to facilitate entry into refrigeration market.

Vision-Every Home ,Everywhere, with pride, passion and performance.

Mission- Everybody creating loyal customers for life

OBJECTIVES

• Innovation• Operational excellence• Customer centric approach• Diversified talent

BUSINESS PORTFOLIO• Air treatment• Fabric care• Food preparation• Food stream solution

PRODUCT PORTFOLIO• Air conditioners• Microwave ovens• Refrigerators• Washing machines

WHIRLPOOL STRATEGIC FRAMEWORK

Transformation from accomplished manufacturer to a consummate marketer

BUSINESS TRACK

• Brand building

• ISO and six sigma

• Export oriented unit established

• Market positioning

• Consumer sensing

• Productivity improvements and cost reduction

Strategies

• Generic Strategies• Corporate Level Strategies• Other Important Strategies

Strategies

• Generic Strategies• Corporate Level Strategies• Other Important Strategies

GENERIC BUSINESS STRATEGIES

When the two factors of positioning-the competitive advantage and competitive scope –are combined

Competitive advantage can arise due to two factors Lower cost DifferentiationCompetitive scope can be in terms of two factors Broad market Narrow market

PORTER’S GENERIC STRATEGIES

11

1. Cost Leadership

2. Differentiation

3 A. Cost Focus 3 B. Differentiation FocusNarrow

Target

Broad Target

DifferentiationLower Cost

Competitive Advantage

Competitive Scope

Ansoff Matrix

Concentration Strategy

Internationalisation & Cooperation

Digitalisation• Transformation of value chain • Integration of communication technologies

with business processes and management practices.

Market Positioning & Advertising

• Theme- Your Partner in Home Making• Customer Focused Innovations• Ad campaign- Ice Ice baby!!

Food For Thought!!!

Question 1

Analyse the case to identify the type of generic business strategy or strategies Whirlpool India is adopting

Strategy adopted by Whirlpool

Differentiation strategy• Market positioning is on the theme ‘your partner in

homemaking’

• Core competence-customer excellence

• Customer focus drives innovations

• Differentiation built on customer responsiveness.

• Focus on special features- movable trays, space for large bottles and strong body to withstand the heavy loads .

Future plan….

Cost leadership -through sustained productivity improvements and cost reduction.

• Expects to turn losses into profit by 2008 by cost reduction.

Question 2

• What aspects of digitalisation of Whirlpool India can you identify in the case? Discuss Briefly.

Digitalization

• Incorporated digital manufacturing technology into its washing machine.

• Software connecting CAD with assembly times and cost of materials

• Research Centre at Pune Online Connectivity to the rest of the world.

• Application of a customer centric marketing strategy

• Website made more interactive-2006

Question 3

• What aspects of internationalisation of Whirlpool India can you identify in the case? Discuss Briefly.

Internationalization

In 1958 Whirlpool Cor. entered into Brazil. India was identified as a growth market in the late-1980s. Joint venture with TVS Group to produce automatic washers at Pondicherry. In 1995, it acquired Kelvinator of India limited to facilitate entry into the refrigerator market in India. A majority ownership in the joint venture with TVS led to the emergence of whirlpool of India limited in 1996.

Contd.. Major brands are

produced in 13 countries and marketed to consumers in over 170 countries

Global consumer design centre for Asia based at Delhi

Export Recognized as an export house with an export-oriented unit

based at Pondicherry ( to produce kitchen Aid appliances for the export market in the U.S.)

Also exports refrigerators and washing machines to South Asia, Asia-pacific, Latin America and west Asia, Russia and East European countries

It claims to be the largest exporter of home appliances from India.

Exports constitute 13 percent of the company and reached Rs. 200 crore in 2006-2007.

Question 4

• In your opinion, what is the stage of industry devt in the consumer durables industry in India? Depending on your ans, comment on whether Whirlpool India’s generic business strategies are appropriate.

Consumer Durables is one of the fastest growing industries in IndiaA strong growth is expected acrossProjected Growth Rates

All key segmentsColour TVs 25-30%

Refrigerators 18-22%

Washing Machines 15-20%

Air Conditioners 32-35%

Others (including VCDs 35-40%

and DVDs)

CONCLUSION:The industy is in growing stage

Development stage of consumer durable industry

Consumer durable industry in the growth stage

• Key factors

Competition crop up Competitors with same core competencies Consumer is hard to convince

What Whirlpool is doing?

• Product differentiation strategy• Focussing on core competencies• Distribution and Service Network• Strengthening retail distribution: 11000 retail outlets 150 cities and towns