BS II 2014-Case at NEC and GTE-Prof Bidwai

8/13/2019 BS II 2014-Case at NEC and GTE-Prof Bidwai

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Core Competenceat

and
http://en.wikipedia.org/wiki/GTEhttp://www.nec.com/


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NEC (Nippon Electric Company)

Formerly known as Nippon Electric CompanyEstablished: Tokyo, Japan (17thJuly,1899)

Headquarters: Tokyo, Japan

Key people: Hajime Sasaki (Chairman of the Board), Kaoru

Yano (President)

Industry: Electronics

Employees: 154786 (consolidated as of March 31, 2007)

Slogan: Empowered by Innovation

Former NEC logo 1899-1992)


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NEC (Nippon Electric Company)

Major operations: IT/ Network solutions/ Mobile/ Personal

solutions business, Electron devices business

Capital: 337.8 billion yen (as of March 31, 2007)

Net Sales: 4652.6 billion yen (fiscal year ended March 31, 2007)

Consolidated Subsidiaries: 342 (as of March 31, 2007)

Present Logo


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NECs Headquarters

NEC Super Tower, headquarters of NEC Corporation, in Minato-ku, Tokyo


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Change Agents of NEC


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Vision of NEC


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Corporate Philosophy

NEC strives through C&C

to help advance societies worldwide

toward deepened mutual understanding

and the fulfillment of human potential
http://www.nec-redefines.com/xhtml/index.aspx?lang=en&autoplay=research


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NECs Commitment

Attaining customer satisfactionDeveloping new technologies

Conducting fair corporate activities

Disclosing information

Preserving the global environment

Maintaining good relations with the community

Conducting thoughtful corporate citizenship activities

Protecting human rights

Valuing employees

Protecting intellectual property and personal information
http://www.nec-lcd.com/english


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NECs Group Structure


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Organization Chart of NEC

Board of Directors

President

Corporate Auditors

Corporate Auditing Bureau

International Business

Promotion Unit

Software Business

Promotion Unit

Marketing Unit

Intellectual Asset

R&D Unit

Innovation Unit

Corporate Staff

Domestic Sales Business Unit

Govt, Community, FinancialSolutions business unit

Enterprise solution

business unit

Social Infrastructure

Solutions business unit

Carrier Network Business Unit

IT Platform Business Unit

Systems IntegrationBusiness Unit

Mobile Terminals

Business Unit

Personal Solutions

Business Unit


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NECs R&D Center- Organization


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NECs R&D- Domestic Network


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NECs R&D- Global Network


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Historical MilestonesDiscovery of single walled carbon nano-tubes by Sumio Iijima

Creation of the Earth Simulator, the fastest supercomputer in the world at the tim

World's first demonstration of the one-qubit rotation gate in solid state devices

Invention of the widely used MUX-scan design-for-test methodology

The John M. Cowley Medal 2006 (The International Federation of Societies foricroscopy)- 03/09/2006

National commendation for Invention of a Synchronized Clock Generator for

ptical Disc- 19/06/2006

The 2005 The Young Scientists' Prize, The Commendation for Science andechnology by the Minister of Education, Culture, Sports, Science and Technology

0/04/2005

19th Advanced Technology Award Fujisanke Business.i Prize- 04/07/2005


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Strategic Intent of NEC


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Principal Business Segments of NEC


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Products/Brands of NEC


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NEC-Early Development

The partnership was established on August 31, 1898 by KunihikoIwadare and Takeshiro Maeda using facilities from Miyoshi Electrical

Manufacturing Company

Joint venture with US based Western Electric Company who had interest

in Japanese phone market headed by Walter Tenney Carleton

Revised treaty on 17thJuly, 1899 resulted in the birth of NEC

Operations started with the production, sales and maintenance of

telephones and switches

Manufacturing plant was established at Mita Shikokumachi in 1901

Adoption of new technology (common battery switchboard) by the

Ministry of Communications in 1903

Exported telephone sets to China in 1904


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Changes in Plant Management PolicyIn 1905, Iwadare visited Western Electric plant to see theirmanagement and production control

Discontinued the Oyakata system of sub-contracting

Inefficiency was removed from production process

New accounting and cost controls were put in place

Time clocks were installed

Expansion of Japanese Telephone Market

Number of telephone subscribers rose from 35000 to 95000Entered the Chinese market in 1908

Established its first foreign sales office in Seoul (Korea) in January,

1908

Between 1907-1912, sales rose from 1.6 million yen to 2 million yen


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Setback by Ministry of Communications

Delayed the third expansion plan of the phone service in March, 1913

Sales fell 60% between 1912 and 1915

During the interim, Iwadare imported appliances including electric fans,kitchen appliances, washing machines and vacuum cleaners to prop up

company sales

In 1916, the government resumed the delayed plan adding 75000

subscribers and 326000 km of new toll lines and successfully completed

the installation of its own telephone lines in Hankow and Wuchang inChina

In 1919, NEC started its first association with Sumitomo Corporation

The Great Kanto earthquake in 1923


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Stable growth

NEC was chosen to modify automatic telephone exchange equipment

from European and US manufacturers

NEC started radio communications business and established a radio research

unit in 1924

NEC started developing electron tubes in 1925

By 1930, it was manufacturing the first 500 W radio transmitter

Developed photo-telegraphic equipment in 1928

It provided the Japans Ministry of Communications with the A-type switchingsystem in 1929

In 1939, it made history by laying one of the worlds longest telephone cable

lines; 3000 km from Tokyo, through Korea and into China


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NEC-Post World War II

Destruction during World War II:

In 1938, the Mita and Tamagawa plants were placed under militarycontrol

On December 22, 1941 the enemy property control law was passed

The Munitions Company Law was passed in October, 1943

Fire bombings affected both the plants reducing its capacity by 40%Domestic Growth:

It began transistor research and development in 1950

It started exporting radio broadcast equipment to Korea in 1951Computer research and development began in 1954

Very strong demand from NTT (Nippon Telegraph and Telephone)

It began integrated circuit research and development in 1960


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NEC-In an expansionary mood

International Operations:

In the late 1950s, NEC exported large-scale communications equipment for

public telephone networks to the Middle and Near East

It established its first marketing subsidiary for communications equipment in

North America in 1963

Operations in Latin America began in the 1960s with the sale of microwave

communications systems

Entered the European market by shipping satellite communications earth

stations and microwave communication systems

Began operations in Africa in the 1970s to promote economic developmentIt introduced its first digital switching system in 1977 for overseas market

In 1977, Japans National Space Development Agency launched the NECs

geostationary meteorological satellite, named Himawari


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NEC- C C EraInternational Operations:

The concept of Computers and Communications (C&C) was adopted

NEC America Inc opened a plant in Dallas (Texas) to manufacture PABX andtelephone systems in 1978

Acquired Electronic Arrays Inc to start semiconductor chip production in US

In 1980, created the first digital signal processor, the NEC PD7710

NEC Semiconductors (UK) Ltd was established in 1981

In 1983, NEC stock was listed on the Basel, Geneva, Switzerland exchanges

NEC Information systems Inc started manufacturing computers and related products

in US in 1984

In 1986, it delivered its SX-2 supercomputer to the Houstan Advanced Research

Center

In 1987, NEC Technologies (UK) Ltd was established to manufacture VCRs, printers

and color TVs for Europe


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GTE (General Telephone and Electronics Corporation)

Founded: 1918

Headquarters: Irving, Texas, USA

Industry: Communications servicesProducts: Internet access, local wireline and wireless

telecommunications services

Website: www.verizon.com (Verizon took over GTE in2000)

GTE corporate logo, 1971-2000


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Products/Brands of GTE

(Now, Verizon)


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GTE- Early Development

Was conceived as a corporate entity when John.F. OConnell, Sigurd L.

Odegard and John A. Pratt purchased the small Richland Telephone CompanyName was changed to Commenwealth Telephone Company two years

hence

Later, the corporation purchased Long Beach, a California based telephone

company and a holding company called Associated Telephone Utilities(ATU)

Stock market crash of 1929 and Great Depression affected the corporation

Subsequently, the corporation was reorganized to General Telephone

Corporation

Its initial line of business was provision of local telephone services

In 1955, General Telephone acquired Theodore Gary and Company

Acquisition of Peninsular Telephone of Florida added another 300000customers


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GTE- Merger and Expansion

In 1959, it got merged with Sylvania Electric Products and the name of the parent

company was changed to General Telephone and Electronics Corporation

It resulted into diverse range of businesses including halogen automobile headlights,

cutting tools, telecommunications equipment, cameras, television sets, atomic reactor

fuel elements, anti-missile defense systems and space frame systems for buildings

During 1970s, GTE expanded by acquiring phone companies in British Columbia,

Quebec, Hawaii and several Western and Mid-western US states1970s also saw GTE consolidating and reorganizing its management; corporate

headquarters was relocated to Stamford, Connecticut from New York City

In 1981, the company sold its electronic holdings to North American Philips

GTE Mobilnet was formed to construct and operate cellular systems in 1981

In 1983, it bought infant long-distance carrier US Sprint

By the end of 1980s, it had annual revenues exceeding $17 billion employing more

than 159000 people operating throughout the US and 40 other countries


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NEC, GTE and the

Core Competence of the corporation

Consider the last 10 years of GTE and NEC. In the early 1980s, GTEwas well positioned to become a major player in the evolving

information technology industry. NEC, in contrast, was much smaller. It

had a comparable technological base and computer business, but it had

no experience as an operating telecommunications company

In 1980, GTEs sales were $9.98 billion. NEC, in contrast, was much

smaller at $3.8 billion in sales

Yet look at the positions of GTE and NEC in 1988. GTEs 1988 sales

were $16.46 billion and NECs sales were considerably higher at $21.89

billionWhy did these two companies, starting with comparable business

portfolios, perform so differently? Largely because NEC conceived of

itself in terms of Core Competencies and GTE did not.-Gary Hamel and C.K Prahlad


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What is Core Competency

Core competencies are the collective learning in the organization,

especially how to co-ordinate diverse production skills and integrate

multiple streams of technologies

- C.K Prahlad and Gary Hamel


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3 Tests to identify a Core Competency

It must have the potential to form the basis for entry intonew product markets

The competence must make a significant contribution tocustomer perceived value

It should be difficult for competitors to imitate


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Core Competency of NECNEC developed a strategic intent to exploit the convergence of computing

and communications (C&C)

NECs top management set up a C&C committee to oversee the

development of core products and core competencies

Entered into strategic alliances to build competencies at low cost

Clarity of strategic intent and strategic architecture

Believed that competitiveness depends on the ability to build corecompetencies faster than competitors and at a low cost

Ability to exploit technological capabilities

Concept of core competency acts as collective learning in the organization

Core competency involves communication, involvement and a deepcommitment to working across organizational boundaries

NEC had integrated view of its business units

To develop core competency, there is no need to spend more on R&D


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C&C Architecture


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What does Core Competency achieve..?

Enables the creation of new products and services

Makes a significant contribution to the customer value

Helps create sustainable competitive advantage


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NEC- Post 1990

In 1990, a new head office building (Super Tower) was constructed

Joint venture agreements were established to manufacture and market digital electronic

switching systems in China

NEC Europe Ltd was established as a holding company for European operations

NEC C&C research laboratories (NEC Europe Ltd) was opened in Germany (1994)

NEC (China) Ltd was established as a holding company for Chinese operations in 1996

In 1998, NEC opened the worlds most advanced semiconductor R&D facility

Marketing effort: Sponsored English football club [Everton (1985-1995)], Harlequin

RUFC and RLFC rugby teams from London

Faced some challenges too in the same decade:

Japanese economy came to a standstill

NEC lost its status as the worlds largest semiconductor maker to Intel and was

also behind Samsung and Hyundai electronics in the memory chip business

Compact computer corporation (US) stunned the Japanese PC market by waging a

price war


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NEC- In the new Millennium

In 2002, NEC electronics corporation was separated from NEC as a new

semiconductor company

NEC Laboratories America Inc was created in November 2002 as a mergerof NEC Research Institute and NECs USAs Computer and

Communications Research Laboratories

NEC built the Earth Simulator Computer, the fastest supercomputer in

the world from 2002 to 2004


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NEC- Financial Results for 2006-07

(fiscal year ended March 2007)


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Profitability

FY 06 S l /O i I


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FY-06 Sales/Operating Income

by Segment

FY 06 IT/NW


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FY-06 IT/NW

Solutions Business

FY 06 M bil /P l


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FY-06 Mobile/Personal

Solutions Business


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FY-07 Financial Forecasts


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FY-07 IT/ NW Solutions Business

FY 07 Mobile/ Personal


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FY-07 Mobile/ Personal

Solutions Business


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FY-07 Electron Devices Business


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Challenges in FY-2007Reinforcement of growth strategy

Steady execution of NGN business strategy

Growth in global market

Further improvement of non-profitable businesses

Solidifying mobile terminal business profitability

Support of NEC electronics turnaround as the largest

shareholder

Thorough enhancement of profitability

Further pursuit of production/ development efficiency as NEC

group

NEC- Stock Price


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NEC- Stock Price

Information

NEC Corporation TSE)19thFebruary, 2008

Last 438

Previous Close 428

Open 435

High 441Low 427

Change +10

Percent Change +2.34%

Currency YEN

Volume 8,474,000

NEC C iti f


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NEC-Composition of

Shareholders


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NEC in INDIA

NEC strengthens its business capability in India through establishment of newcompany (NEC India Pvt Ltd) for IT/Network business

NEC signs India-Sri Lanka contract

NEC Solutions (US) joins hands with Niteo Partners Inc in Chennai to integrate

offshore software delivery and BPO capabilities into its solutions business in the USNEC enters the Indian PC market in 2005

NEC and Sify form strategic partnership to promote thin client computing in India

NEC enters into a joint venture with HCL (India)

GTE P t 1990


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GTE- Post 1990US economy was doing well- saw dramatic expansion of mostcommunications services with data applications and growing demand

from the internet spaceAnnounced merger with Contel Corporation, a major local telephone andcellular service provider

Entered into an agreement to merge with Bell Atlantic (1998)

Also, announced an alliance with Vodaphone Airtouch (1999) to form the

largest wireless communications company in the USDuring the decade, it introduced new advanced switching modes,interactive video services, wireless data and personal communicationservices, international roaming services, internet access services, onlineservices

Reached agreements with Lycos (online services), Qwest (fibre opticnetworks) and Cisco (internetworking capabilities)

Announced a joint venture with SOVINTEL to provide instantaneous,high quality telephone service from the Soviet Union to the West andAsia

Began operations in Argentina, Belgium, Mexico, China, Japan, Taiwan


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Verizon Communications Inc

Founded: 1983Headquarters: New York, USA

Industry: Communications services

Products: Broadband internet services, television service, local wireline and

wireless telecommunications services

Chairman of the Board and CEO: Ivan Seidenberg

Revenue: $90 billion (2007)

Net income: $6.12 billion (2007)

Employees: 239000 (2007)

Slogan: We never stop working for you, Americas most reliable network, Its the

network

Website: www.verizon.com

Verizon- Statistics
http://www22.verizon.com/


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Verizon- Statistics

(As of year end 2007)

Verizon Wireless:Retail Customers: 63.7 million

Total Customers: 65.7 million

US markets served: 49 of top 50

Employees: 69000

Verizon Wireline:

Wireline broadband connections: 8.2 million

US Wireline Access Lines : 41.4 million

International presence: 140 + countries

Employees: 161000
http://www22.verizon.com/


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Verizon- Wireline Presence

i i l


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Verizon- Wireless Presence

Verizon- Financial Performance


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Verizon Financial Performance

(year ended 2007)

Consolidated Revenue and Operating margin


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Wireless Customer Growth


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Wireless Revenue Growth


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Wireline Customer Growth


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Wireline Revenue Growth


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BS II 2014-Case at NEC and GTE-Prof Bidwai

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