Lock & Lock IME 20051164 Junghee Pyeon IME 20051206 Wootaek Hwang IME 20051214 Joonhyung Ahn.
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Transcript of Lock & Lock IME 20051164 Junghee Pyeon IME 20051206 Wootaek Hwang IME 20051214 Joonhyung Ahn.
Lock & Lock
IME 20051164 Junghee PyeonIME 20051206 Wootaek HwangIME 20051214 Joonhyung Ahn
CONTENTS1.Company & Product Overview
(1) Company Overview(2) Product Overview
2.Business Analysis(1) SWOT Analysis(2) TOWS Analysis(3) Five Force Analysis(4) BCG Matrix
3.Strategic Management of Innovation(1) Collaboration Strategies(2) Sources of Innovation(3) Patterns of Innovation(4) Types of Innovation(5) Dominant Design(6) Timing of Entry(7) Choosing Innovation Projects(8) Protecting Innovation
CONTENTS1.Company & Product Overview
(1) Company Overview(2) Product Overview
2.Business Analysis(1) SWOT Analysis(2) TOWS Analysis(3) Five Force Analysis(4) BCG Matrix
3.Strategic Management of Innovation(1) Collaboration Strategies(2) Sources of Innovation(3) Patterns of Innovation(4) Types of Innovation(5) Dominant Design(6) Timing of Entry(7) Choosing Innovation Projects(8) Protecting Innovation
(1) Company Overview
1. Company & Product Overview
Since its establishment in 1978, Lock&Lock Co. Ltd has been grown as a global company that exports its products (Lock&Lock containers with new-concept four side interlocking system) to more than 100 countries worldwide.
(1) Company Overview
1. Company & Product Overview
Export Destinations
(1) Company Overview
1. Company & Product Overview
Financial Status
Sales
Operating profit
2007 2008 2009 2010(half) 2007 2008 2009 2010(half)
Million Won Million Won
Lock&Lock has been grown very fast since its estab-lishment, and aim to achieve 10 trillion Won sales in 2020.
(2) Product Overview (1/3)
1. Company & Product Overview
Plastic Container Glass Container
Product Type
(2) Product Overview (2/3)
1. Company & Product Overview
Bis-free ContainerMany customers have con-
cerns that plastic containers make environmental hor-mones. Glass containers also have some disadvantages such as heavy weight, frag-ileness, and so on.
Lock&Lock developed a new technology container called Bis-free, which is lighter than glass and doesn’t make any environ-mental hormones.
(2) Product Overview (3/3)
1. Company & Product Overview
Product Characteristics
(1) 4-side interlocking sys-tem
(2) Hollow silicon packing
The patented technology of interlocking all four sides and the hollow silicon packing are utilized for the products.
CONTENTS1.Company & Product Overview
(1) Company Overview(2) Product Overview
2.Business Analysis(1) SWOT Analysis(2) TOWS Analysis(3) Five Force Analysis(4) BCG Matrix
3.Strategic Management of Innovation(1) Collaboration Strategies(2) Sources of Innovation(3) Patterns of Innovation(4) Types of Innovation(5) Dominant Design(6) Timing of Entry(7) Choosing Innovation Projects(8) Protecting Innovation
(1) SWOT Analysis
2. Business Analysis
SWOT
Strength Weakness
ThreatsOpportunities
• Powerful brand image
• High market share
• Patents
• Know-how
• R&D
• No other business models
• Big market(ex. China, U.S.)
• Global brand awareness
• Various airtight products
• Modern life style
• Many copies & Fake products
(2) TOWS Analysis
2. Business Analysis
TOWS
S-O S-T
W-TW-O
• By using know-how, diversify products• By using global image, target global market• By using brand image, grow the market share
• Concentrating on “high quality and good brand image” through various promotions & campaign
• Prepare for new business models, although it is not profitable right now.
• Protecting innovation restrain fake product, allowing Lock&Lock diversify the business model.
(3) Five Forces Analysis
2. Business Analysis
Existing Rivalry
• Copies• KOMAX, GLASSLOCK, etc
Potential Entrance
• Existing Korean companies• Foreign low quality & low price container companies
Threats of substitutes
Bargaining power of suppliers
Bargaining power of buyers
• Raw materials are easy to buy
• Tradition containers
• Many copies with low price. But, because of brand image, Rock&Rock can sell high price.
High
Low
(4) BCG Matrix
2. Business Analysis
Star Question Mark
Cash Cow Dog
High
Low
Mark
et G
row
th
High Middle Low
Market Share
Plasticairtight
container
Ceramic or glassairtight
containerWater bottle
andThermos
Kitchen utensils
Living box
Cookingequipment
CONTENTS1.Company & Product Overview
(1) Company Overview(2) Product Overview
2.Business Analysis(1) SWOT Analysis(2) TOWS Analysis(3) Five Force Analysis(4) BCG Matrix
3.Strategic Management of Innovation(1) Collaboration Strategies(2) Sources of Innovation(3) Patterns of Innovation(4) Types of Innovation(5) Dominant Design(6) Timing of Entry(7) Choosing Innovation Projects(8) Protecting Innovation
(1) Collaboration Strategies (1/10)
3. Strategic Management of Innovation
Strategic Alliance (1/3)
Lock&Lock made a strategic alliance with partners which needs high quality air-tight containers such as tea, ice cream and so on. The company provide customized air-tight containers to the partners
Ex1) Tea containerIn 2004, Damtuh, a tea
maker, launched lemon tea and peach tea with Lock&Lock container. More than 10,000 products were sold just within one week af-ter launching it.
(1) Collaboration Strategies (2/10)
3. Strategic Management of Innovation
Strategic Alliance (2/3)
Ex2) Tea containerIn 2011, Baskin Robbins
31, an ice cream maker, started a promotion event that if a customer buy an ice cream which is bigger than quarter-size, the company provide Lock&Lock container with just 1,000 KRW.
(1) Collaboration Strategies (3/10)
3. Strategic Management of Innovation
Strategic Alliance (3/3)
Ex3) Doosan Bears Tum-bler
In 2011, Doosan Bears, a baseball team, made tum-blers with Lock&Lock’s tech-nology.
(1) Collaboration Strategies (4/10)
3. Strategic Management of Innovation
Joint Venture
Since air-tight container market is red ocean, Lock&Lock needed to enter a new market but it had no speciality in other fields. So they made a joint venture with companies in other fields.
Ex) Zen&LockIn 2006, Lock&Lock made a
joint venture with Zen Korea, a ceramic container maker, to produce ceramic air-tight con-tainer. The joint venture got 400,000 pieces order right af-ter it launched ceramic air-tight Kimchi container.
(1) Collaboration Strategies (5/10)
3. Strategic Management of Innovation
Outsourcing
Ex) Design Outsourcing of Speed Cook
In 2011, Lock&Lock launched Speed Cook, a lamen cooker. Since Lock&Lock’s core compe-tency is manufacturing technologies, not designs, the company outsourced this design function to Motto Design, a design company.
(1) Collaboration Strategies (6/10)
3. Strategic Management of Innovation
Design Idea Collaboration for Localiza-tion
Ex) Locally Customized DesignDepending on regions, customers have different needs. For
example most Indians need flat bread containers, Westerns need cereal containers, and Koreans need Kimchi containers. These design ideas mostly came from local buyers and collabo-rators in each region.
India Western Coun-tries
Korea
(1) Collaboration Strategies (7/10)
3. Strategic Management of Innovation
Promotion Collaboration (1/2)
Ex) Promotion through famous home-shopping channelsAt the beginning of launching Lock&Lock, since the company
wanted to make a high-quality brand image, it chose QVC, the No.1 home shopping channel in the world, as a business part-ner.
(1) Collaboration Strategies (8/10)
3. Strategic Management of Innovation
Promotion Collaboration (2/2)
Ex) Partnership with promotion agenciesWhen Lock&Lock enter unfamiliar regions, the company
formed a partnership with promotion companies which have more knowledge about the region. They formed a partnership with Starcom to enter Japan and UK markets, and with Hill & Knowlton to enter China markets.
(1) Collaboration Strategies (9/10)
3. Strategic Management of Innovation
Summary (1/2)<Protecting Core Compe-tency>
Lock&Lock’s core compe-tency is technological su-periority over other com-petitors. To take advantages of this, the company relies only on in-house R&D, and does not collaborate with other companies in R&D part.
<Collaborating Strategi-cally>
Since Lock&Lock is a air-tight container production company, the company has no special knowledge about design, promotion, and so on. To overcome this short-age, the company collabo-rated with other specialist in that field. And also some-times it made strategic al-liance with other industry players to boost the sales of its products.
(1) Collaboration Strategies (10/10)
3. Strategic Management of Innovation
Summary (2/2)
Collaboration of a certain function in a firmshould be determined depending on its strategic importance!!!
(2) Source of Innovation
3. Strategic Management of Innovation
Customer Needs
People want to buy a container which doesn’t spill over a content in the container. Needs for Airtight Container
(3) Pattern of Innovation
3. Strategic Management of Innovation
Added New Characteristic
Not related to traditional patterns of InnovationAdded New Characteristic: New Characteristic is added to
New Product. It can be one of patterns of Innovation.
(4) Types of Innovation
3. Strategic Management of Innovation
1. Product vs. Process
2. Radical vs. Incremental
3. Competence Enhancing vs. Competence Destroying
4. Architectural vs. Component
Added New Characteristic to existing product Product Innovation & Component Innovation
Because of Rock&Rock, almost whole container is re-placed with Rock & Rock Radical Innovation
In 1978, Lock&Lock Co. Ltd has manufactured more than 600 products including kitchen wares Competence En-hancing Innovation
(5) Dominant Design (1/2)
3. Strategic Management of Innovation
Kukjin Distribution Co. founded in 1978 launched Lock&Lock products having the technology of interlocking all four sides and the hollow silicon packing. Lock&Lock instead of rub-ber cover have become the dominant design in airtight container market.
Now, Lock&Lock is the byword for airtight container. Lock&Lock is not only a premium airtight container but also the best brand of airtight container market in China. Also, Lock&Lock’s awareness in Korea is 99%.
(5) Dominant Design (2/2)
3. Strategic Management of Innovation
Network Externality help Lock&Lock the dominant design of airtight container. Collaboration between Lock&Lock and lots of com-pany, rising Lock&Lock’s brand awareness.
Winner-Take-All Markets didn’t occur. There are two strong com-petitors. Lock&Lock can’t be a natu-ral monopoly company not only be-cause Komax makes the airtight con-tainer having superior design and high quality but also because Glass-lock makes airtight container consist of glass having attractiveness for Western culture.
Komax
Glasslock
(6) Timing of Entry (1/2)
3. Strategic Management of Innovation
Many people think Rock&Rock is the first mover. But, the first mover is KOMAX in an airtight container market. That is, Rock&Rock is the follower.
Follower
(6) Timing of Entry (2/2)
3. Strategic Management of Innovation
When KOMAX and Rock&Rock launched an airtight con-tainer, people didn’t know how the container was useful for them. So, Rock&Rock used TV home shopping to explain the usefulness of an airtight container. Because of TV home shop-ping, people started to use Rock&Rock container. So, Rock&Rock can lead the market, rather than KOMAX.
How does Lock&Lock lead the market, rather than KOMAX?
(7) Choosing Innovation Project (1/2)
3. Strategic Management of Innovation
Since its establishment in 1978, Lock&Lock Co. Ltd had manu-factured various products which are more than 600 including kitchen and bathroom ware.
But, since 1998, the company has focused its core compe-tency only on Lock&Lock products and stop investing to other products groups.
Just 6 years after launching Lock&Lock products, the com-pany extended its market share by 60% in Korea, and became the world 3rd largest company in the food storage con-tainer industry.
(7) Choosing Innovation Project (2/2)
3. Strategic Management of Innovation
Lock&Lock manufactured huge amount of various products before 1998. Jun-il Kim thought Lock&Lock had to focus on one product having brand power, so he made 20 criteria for choosing product. Easy to manage inventory Not fragile Small volume Independent to season Independent to culture
Air-tight container was the best product meeting all criteria of qualitative choosing process and these decision has been excellent.
(8) Protecting Innovation (1/2)
3. Strategic Management of Innovation
Lock&Lock takes advantages of protecting technolog-ical innovation rather than diffusing it. Since the com-pany’s core competency is technological superiority over the other companies, they need to protect their intellectual proper-ties through patent, trademark, and design registrations.
In addition, the company organized a special team which is responsible for preventing others from imitating Lock&Lock products. In 2010, they found a fake product manufacturing factory in China and confiscate many imitations.
(8) Protecting Innovation (2/2)
3. Strategic Management of Innovation
Lock&Lock promote the method to distinguish the real Lock&Lock product from the imitation product using the web site and the store. This strategy is so effective in the long run, although it isn’t effect on consumer in the short run.
Lock&Lock don’t sue the com-pany making the imitation product, but with market sharing power, Lock&Lock prevent the distributors from selling the imitation product. Because legal action ain't holding no air in China.
Q&A