Vsm group examination of strategic position

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Vsm group examination of strategic position

Economic factor a Firstly, the demand for sewing machines in the western hemisphere had been declining for more than two decades. Industry profitability had deteriorated, particularly hard on manufacturers of industrial machines and low-price mechanical machines for domestic use.

Second, the sharp drop in demand for industrial sewing machines has result much more fierce competition on the professional side in Europe and in the US. Technological factor a As the development of specialized software, the computer-controlled machines have become popular in the world market.

Some world top manufacturers can make the Sorry, but full essay samples are available only for registered users Choose a Membership Plan entire range of computer-controlled machines. It makes the rivalry between VSM Group and other powerful manufacturers much more fierce and intensive. It has brought sewing machine manufacturers great opportunities to create new powerful distribution system through using the web-shops.

After scan the external environment of VSM Group, although the economic environment is not that great, a favorable circumstance can be seen in technological factor.

If VSM can develop more Vsm group examination of strategic position products than its rivals and retain its customer, I believe it could gain survival and to success in this environment.

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Some of the external factors of importance as identified by Hitt et al Economic factor The economy in which an organisation operates is vital to the operation of organisation. The unawareness of how well the German — speaking economies in Europe were doing at the time of the integration Pfaff into the VSM group almost cost the group the loss of the entire market in these region.

As a result of the decline in the demand of sewing machines in the west at the time of Pfaff acquisition, sales in these regions were at the lowest any where in Europe. This was a threat to the VSM group. This was an opportunity well exploited by the VSM group.

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Socio-cultural factor- This is concerned mostly with the societal attitudes and cultural values of the society in which any organisation operates. The diverse cultures of the countries e. Although a threat, it would depend on how well the group is able to use its knowledge of this factor to transform it to an opportunity for competitive advantage.

Technological factor — As a leader in the innovation of hi-tech sewing machine with free online access to its operating systems; the VSM group should be able to sustain this leadership quality by updating the technological input of this machine as demanded by change in technology.

This could be a threat to its business if not harnessed or an opportunity if well harnessed.

Vsm group examination of strategic position

Porter explains that there are five forces that determine industry attractiveness and long-run industry profitability: These include factors that need to be overcome by new entrant in the sewing machine industry, if the company intends to compete effectively with VSM.

Some of these factors include: Capital requirement — The VSM group has not only positioned itself well technologically, but also financially. With an operating cash flow of million SEK during the case period.

It would take a potential competitor in the same industry to invest more than the operating cash flow of VSM in their value system in order to effectively compete with VSM. This not only positions VSM as a clear leader in the industry, but also constitutes a threat to entry to potential competitors.

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Access to supply or distribution channel — With the acquisition of major competitors in the sewing machine industry e. Pfaff and the Zetina plant and the co-operation with one of the largest retailers of fabric in the US by the establishment of in-store outlets. This is another factor a potential competitor must overcome in order to effectively compete with VSM.

This is another factor a potential competitor has to overcome in order to be able to compete with VSM. With 2 major brands i. Husqvarna Vikings and Pfaff in the sewing machine market, VSM was able to establish a product-for-product substitution, thereby providing customers with choice of buying any of these ranges of products.

Brother, Janome, and Juki- Three major competitors of VSM Group in the industry who supported their own research and development facilities which were highly innovative and competitive, high-volume manufacturers, low-cost productions, technological advancements.

The power of buyers and suppliers — VSM group was able to increase its supply power with the acquisition of major players in the industry, while the buying power of consumers was also increased with 2 major brand names in the market.

New entrant or existing competitor would have to satisfy these criteria to effectively compete with VSM group. The above summaries the analysis of the business environment in which VSM operates and how it has used these aspects of strategy to gain a competitive advantage over rival firms.

Changed the suppliers to local ones and far east ones for both Pfaff and Husqavarna.

Vsm group examination of strategic position

It is assumed to be the style of strategy adopted by the Global Pharmaceutical Industry as outlined by Holland and Batiz-Lazo ; to gain a competitive edge in the business environment; where the combination of external factors such as socio-cultural i. SWOT Analysis The variables that operate within an organizations environment can be divided into two parts- external forces and internal forces.

Strengths a VSM Group enjoyed its historical and specialized reputation in the world market. Powerful brand awareness, specialized technologies of producing and developing household sewing machines, as well as abundant business experiences could make VSM stand at an enjoyable place in this industry.

Weaknesses VSM only manufactured household sewing machines that it can only seek profits in the domestic segment, and its development space cannot expand into professional segment.Case Study Analysis: The VSM Group History of VSM Group Strategic Capabilities Then and Now PESTLE Analysis PEST Analysis PEST analysis, a useful approach of examining the Political-legal, Economic, Social-cultural, Technological factors of the environment of an organization, can be used to examine the various aspects and trend .

VSM Group manufactures markets and sells consumer sewing machines, holds a leading position in the medium to high-end segments of household sewing machines on the world market. After redirection, VSM had carried out a set of strategies to pull itself from inferior position into an enjoyable place.

After redirection, VSM had carried out a set of strategies to pull itself from inferior position into an enjoyable place. In this report, the strategic position of VSM in will be analyzed first, along with three divisions, the environment, strategic capability, expectations and purposes.

A discourse of VSM's strategy and its development builds on the interplay between strategic stretch and fit - stretch out in terms of things to consider for existing resource positions and easily fit into terms of building new resources to fully capture a position on the chosen product market.

The strategic position of the VSM Group AB was analysed by applying the analytical models of strategic management to the current situation in the company. The following models were utilised to analyse both the internal and external environment of the company, namely, PESTEL, Five Forces Model, and the SWOT analysis.

Vsm Group: Examination of Strategic Position and Development of a Competitive Strategy; Vsm Group: Examination of Strategic Position and Development of a Competitive Strategy. Words May 15th, 19 Pages. 1. INTRODUCTION Johnson, Scholes and Whittington (, p.

9) define strategy as the direction and .

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