Case Study Analysis For Diamond Industry, Intel, Global Forces, Advertising Industry, And IKEA Essay.

De Beers: Monopoly and Strategies

Describe about the Case Study Analysis for Diamond Industry.

De Beers is synonymous with the diamond industry. The company has monopoly over at least two-third of the diamond present in the globe. The company has a war-torn competition with the countries like Sierra Leone, Angola and Democratic Republic of Congo which have the reputation of having the entire diamond of the industry. With the continuous increasing monopoly of the company over the diamond business, it has become an important aspect for keeping the rights of the consumers. The nongovernmental organizations are taking actions against the oppressive nature of the diamond company. In fact the increasing impact on the oppressive nature of the industry and utilizing the child labor has created greater awareness among the society.

There has been an increase in the demand of the natural diamond because there has been increasing synthetic and industrial diamond in the market. Therefore, exploring and mining of diamond along with it distribution and trading became an integral part of the business of the diamond industry. De Beers dug out diamond from the alluvial soil where diamonds are deposited by the means of erosion of the kimberlitic pipes. The alluvial diamonds are easily exportable and they are used widely for the jewelry making and other garnet purposes. 

Total revenue of the company was increased to about $4.9 billion in 2000. Other competitors in the field of diamond extraction namely Rio Tinto, BHP Billiton of Australia or the Alrosa of Russia became the reminder for De Beers to think of their business strategies and their means of operation that had a clinch of legal and regulatory obligation that are followed at the time of conducting the mining of diamond (Laud, Betts and Basu 2015). The final price set by the company for selling the diamond include not only the extraction cost but other charges including sorting of diamonds, distribution, processing, grading for the retail consumption and after the making of the jewelry.

The company has adopted a number of strategies to fight the competitors in the existing market. There had been introduction of a number of legal and regulatory monitoring services that did not allow the access of diamond marketing. To fight the competition in the business, De Beers invested heavily on the advertising and marketing. De Beers’ marketing campaign positioned the products of the company as heirlooms and gifts for special people on the occasion of love. Focus has been made on encouraging consumers to buy things for special occasions like engagement or marriage. Further, the company focuses greatly on the increasing competition and therefore appointed a new management team with Nicky Oppenheimer as the chairman of the company who look after the marketing of the products.

Intel: Pushing the Development of Design

There has been a transition in the diamond industry by the beginning of the 21^st century. There has been a considerable growth rate in the diamond sale in US especially in the east. It is for the same reason marketing focus has been made keeping these regions in mind. There has been a transition in the management of the company in late 1990s (Kawabata and Nisio 2012). This transition had created negative impact on the company. It was then the new management was introduced to improve the situation of the company. De Beers also made approaches for acquisition of other companies to increase their domination in the market. There were a number of social challenges as well that the company was facing and it was thus suggested that diamond was more favorable than other things used as a luxury product such as the perfume or the watches. It was ultimately derived that apart from the other luxury items, it was important to focus on the selling of the diamonds that shall bring better profit to the organization.

Apart from the external approaches made to improve the condition of the company, several approaches were made internally to fight the competition in the market. There had been implementation of new training program in the organization to improve the performance of the employees and make them eligible to fight against the odds of the market. The company in fact took the initiative of partnering with other brands to increase their business implication in the market. The company partnered with Hindustan Diamond Company Limited with 50% interest and became an equal partner in sharing. It was with their help of the mergers, the company was able to contribute more on the marketing and advertising and helped being competitive in the market.

The microprocessor company Intel had attained market valuation of $113 billion. From beginning, the strategy used by the micro processor company was to push the development of the design of the product. However, the manufacturing process was complex and at many instances the company has to suffer. Intel moved on producing more complex products and devices. Focus had been made on the manufacturing of semiconductors at a dramatically lower rate. With the scope of exploiting the new generation opportunities for further process improvement and optimization, the company kept on growing. Introducing the devices and process at a premium price was one of the tools of product development and better product cycle of the company.

Global forces and the advertising industry: PESTLE analysis and Five force analysis

In the later stage of the Company’s development, the company contracted with the Japanese firm namely Busicom. It was then thought that an innovative design of the product might be of great help to operate in the competitive market. The next approach made by the company was the introduction of PC or the Personal Computers in the market. A computer with a keyboard, monitor and a processor has to be a successful project in the market. In this respect, it has to be mentioned that the potential and the future success of the micro processor was failed to recognize the importance of the processors (Michalski, Carbonell and Mitchell 2013). Steve Jobs, the CEO of Apple understood the impact of the micro processors and took the advantage of the micro processor chip to gain a large market share as much as possible. There was a continuous competition in the PC market by the giant companies like IBM. The initial campaign that the IBM initiated was ‘project CRUSH’. It was intended to increase the sale of computers and the revenue in fact increase by $ 5.5 billion in the next four years.

Another important aspect of Intel was to take initiative to design the DRAM. Manufacturing 1M DRAM was both challenging and had risk in getting proper return from the market. Intel has regarded that there is a significant chance of return from the product sold. It was expected that the senior managers of the company shall remain committed to the development of the business and the new process technology that has unanimously favored to adopt the new technologies. Strategy adopted by the manufacturing company to offer the customers a complete set of the computer rather than assembling different parts of the computers. The commitment of the company to supply all the necessary needs of the industry rather than only the supply of chips and micro processor was another achievement of the company. The increasing number of computer manufacturing companies like Compaq, Microsoft proved to be a real challenge for the Company (Teodoro et al. 2014). The risk of the reduced instruction set computing that had a dominating workstation market created a threat for the company. Companies like Motorola were joining the league in the manufacturing of the desktop computers. However, Intel had a powerful approach in manufacturing its own processors and micro processor chips. The company faced threats due to the advancement of other clone computers as well. The customer rate was also increasing from time to time. Therefore, there has been an open opportunity for the company to expand and launch new products in the market. Another issue was related with the supply of the products in the market. The Intel inside campaign was a successful one to fight the major competitors in the market. However, several sustainable approaches undertaken by the company are fruitful enough to survive the intense competition in the market.

IKEA: Reducing the Price and Offering Huge Number of Products

PESTLE analysis:

Political: Impact of the digital revolution created negative impact on the industry. The advertising sector rose about 15% in the stock market.

Economic: In the past two decades there has been increase of about $165 billion

Socio-cultural: People accepted the transformation of the advertising media

Technological: The advent of the digital media reduced the efficiency of other media like TV or radio.

Legal: The industry might face legal suits against the increasing competitive situation in the market (Gupta 2013)

Environmental: Emerging industry was environmental friendly and therefore created positive implication

Five force analysis:

Threat of new entry: The increasing number of boutique industries

Supplier power: Many small specialists were taking over the new sector

Buyer power: The consumer brands like Coca-cola, Nike and brands that target both consumers and business like Microsoft had domination in the advertising market.

Competitive rivalry: Search engines like Google and Yahoo (Hasan 2015)

Threat of substitution: Digital media where advertisement can be given at a much lower rate.

1. Cost leadership:

The price of the furnishing products was reduced and more stores were opened locally to fight the local competitors. Growing the sales in the existing stores was another approach.

2. Differentiation:

Huge number of products was offered to the consumers. The company adapted better ranges of product with huge range and style (Hultman et al. 2012).

3. Sustainability in strategy:

Shopping experience was focused on the factor of manufacturing better furniture from the raw materials and distributes it locally. Therefore, reducing the cost of chain supply of the products was one of the strategic approaches (Tiwari 2015).  

4. Lesson from China:

Change in the organization also leads to the success in the business. Change processes are necessary for innovative approaches. Idea of home delivery was also learnt from China lesson.

Rationale of the issue of:

a) Founder of RED: To support the victims of HIV in the major underdeveloped countries commencing from Rwanda.

b) Den Henkle and Gap: To increase awareness among people about the continuous degrading condition of the poor people and providing a helping hand to them (Caniato et al. 2012).

c) Author of the article: It was merely an advertising campaign where the Hollywood actors also participated. It shall look like the consumers of RED products are also helping the victims like the mega stars.

View of shareholders:

They believed that people can directly donate the amount for the charity and there is no necessity of spending huge amount on advertisement.

RED an appropriate corporate activity:

The activity has definitely grabbed the attention of people worldwide and helped to increase the sale of products (van Ittersum et al. 2013).

Initiative taken as a shareholder:

I would have appreciated the idea and at the same time might have donated a good sum of money for the same cause to improve the image of the company.

1. Advantages and disadvantages of Rovio’s business model:

The main advantage was using cartoon characters to attract the gamers. The application was a successful one and lead to the development of physical accessories as well. The Angry bird game was the most successful one and had been successful in grabbing huge fans. The disadvantage of the business model is the timeliness of the games and applications (Santos 2014). With the introduction of a new game, the existence of the previous game shall disappear.

2. Strategy that Zynga might have pursued:

Zynga might have used the strategy to manufacture the accessories of Angry Bird and not to participate in the gaming app because the app might lose its relevance at a near time. There has been great demand of the accessories like Tshirt, Watches and other physical things. Zynga might undertake such business strategies (Correia 2014).

1. Google’s Strategy

In order to diversify to the products, the organization has developed Google+ to rival Facebook. Apart from that, Google had also made acquisition with Motorola to rival with Smartphone dominance Apple. By the year 2012, the organization had also launched driverless car (Spector Norvig and Petrov 2012).

2. Strength and weakness of Approach

The strength of its approach lies in providing diversified products to the customers. The organization has become able to compete highly with its competitors through offering unique products (Liu, Au and Choi 2014). On the other hand, the weakness of its approach can be seen in lack of emphasis on experimentation and operational efficiency.

3. Google’s Approach to strategic development

The leaders of the organization should minimize the free time allocated to the employees and lead them to be more engaging towards innovative works. In order to bring changes within the organization, Larry had taken of role of sole CEO in the year 2011. The leaded the employees to be more effective and focused towards core organizational projects.

References:

Liu, C.Z., Au, Y.A. and Choi, H.S., 2014. Effects of freemium strategy in the mobile app market: an empirical study of Google play. Journal of Management Information Systems, 31(3), pp.326-354.

Spector, A., Norvig, P. and Petrov, S., 2012. Google's hybrid approach to research. Communications of the ACM, 55(7), pp.34-37.

Michalski, R.S., Carbonell, J.G. and Mitchell, T.M. eds., 2013. Machine learning: An artificial intelligence approach. Springer Science & Business Media.

Teodoro, G., Kurc, T., Kong, J., Cooper, L. and Saltz, J., 2014, May. Comparative Performance Analysis of Intel (R) Xeon Phi (TM), GPU, and CPU: A Case Study from Microscopy Image Analysis. In Parallel and Distributed Processing Symposium, 2014 IEEE 28th International (pp. 1063-1072). IEEE.

Gupta, A., 2013. Environmental and pest analysis: An approach to external business environment. Merit Research Journal of Art, Social Science and Humanities, 1(2), pp.013-017.

Kawabata, Y. and Nisio, K., 2012. Human Resource Management in Japanese Companies Expanding into Developing Countries-A Case Study of Hunan Heiwado Employing Local Staff in order to Realize Their Business Model and Creating a Competitive Advantage. Economics & management series, (2012), pp.1-12.

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Hasan, M.M., 2015. Marketing Analysis of Unilever. Total Quality Management, 11, p.13.

Caniato, F., Caridi, M., Crippa, L. and Moretto, A., 2012. Environmental sustainability in fashion supply chains: An exploratory case based research.International journal of production economics, 135(2), pp.659-670.

van Ittersum, M.K., Cassman, K.G., Grassini, P., Wolf, J., Tittonell, P. and Hochman, Z., 2013. Yield gap analysis with local to global relevance—a review. Field Crops Research, 143, pp.4-17.

Hultman, J., Johnsen, T., Johnsen, R. and Hertz, S., 2012. An interaction approach to global sourcing: A case study of IKEA. Journal of purchasing and supply management, 18(1), pp.9-21.

Tiwari, S., 2015. Standardized marketing strategies: a solution to the global competition? A case study of IKEA in Norway, Sweden, France and China.

Santos, M.E.M.H., 2014. Business concept design of an innovative product: Partnership between Nmusic and Rovio Entertainment Ltd (Doctoral dissertation).

Correia, A.C.M., 2014. Strategy definition of a new business opportunity in mobile-casual gaming: Partnership between Nmusic and Rovio Entertainment Ltd (Doctoral dissertation, NSBE-UNL).