strategic analysis pak suzuki motors
TRANSCRIPT
ZAFAR UD DIN 2134UMER FAROOQ 0177USMAN SHEHZAD 2175AHSAN UL HAQ 2127RAO FAIZAN ELAHI 0188ABDUL NASIR 0028QAISER AYOUB 2158
Strategic AnalysisPak Suzuki Motor Company Limited
PAK SUZUKI MOTORS COMPANY LIMITED
ACKNOWLEDGEMENT
In the name of Allah, Most Gracious, Most MercifulMost Gracious, Most Merciful; Master of the Day of Judgment.
INTRODUCTION Pak Suzuki Motors Company Ltd. is a
company assembling and distributing Suzuki Japan's cars in Pakistan. Currently they are one of the most successful motor companies in Pakistan.
The firm was founded in 1983 as a joint venture between PAK and Suzuki,
formalizing the arrangement by which AWAMI Auto Ltd. had produced the Suzuki SS80 from 1982.
INTRODUCTION (CONT’) Suzuki originally owned 25% of the
stock, and has gradually increased their holding; they now own 73.09%.
The company now assembles a wide range of Suzuki vehicles and aims to produce 150,000 vehicles per year. (2008 production was 100,000
VISION
To be Excellent All Around
MISSION
To provide automobile of international quality at competitive price
STRATEGY FORMULATION FRAMEWORK
Matching stage Decision stageInput stage
INPUT STAGE
• Internal • Factor
evaluation
(IFE)
• External factor evaluation
(EFE)
• Competitive profile matrix
(CPM)
EXTERNAL FACTOR EVALUATION MATRIX
OPPORTUNITIES Weight Ratings Weighted Score
1. Increasing Demand for Cars 0.15 4 0.60
2. Efficient EFI Engines 0.10 3 0.30
3. Large Market to operate 0.10 3 0.30
4. Global spare parts market 0.05 2 0.10
5. Small size CNG Cylinders 0.12 3 0.36
THREATS
1. Tough Competitors like Toyota and Honda 0.14 2 0.28
2. Inflation Rate 0.08 3 0.24
3. Heavy Taxes 0.08 3 0.24
4. Cheaper Imported Cars 0.10 4 0.40
5. Increase in Fuel Prices 0.08 2 0.16
Total Weighted Score 1.0 2.98
INTERNAL FACTOR EVALUATION STRENGTHS Weight Ratings Weighted Score
1. Highest Market Share 0.20 4 0.80
2. Low Price Vehicles 0.10 4 0.40
3. Large Distribution Channels 0.12 4 0.48
4. Easy availability of spare parts 0.08 4 0.32
5. Highly Innovative and deep product line 0.12 4 0.48
WEAKNESSES1. Scarcity of raw material 0.08 2 0.16
2. Lack of coordination and linkage with Govt. bodies 0.05 2 0.10
3. Less focus on Looks and design 0.10 1 0.10
4. Less Technical Training Institutes 0.05 1 0.05
5. Less distribution channels in sub urban areas 0.10 1 0.10
Total Weighted Score 1.0 2.99
COMPETITIVE PROFILE MATRIXCritical Success Factors
Weight Suzuki ToyotaRating Score
Total Rating Score
Total
1 Innovation 0.30 4 1.20 3 0.90
2 Market Share 0.10 1 0.10 3 0.30
3 Competitive Pricing 0.15 2 0.30 3 0.45
4 Brand Image 0.10 4 0.40 2 0.20
5 Customer Satisfaction 0.20 3 0.60 3 0.60
6 Advertising 0.15 4 0.60 3 0.45
Total 1.00 3.20 2.90
MATCHING STAGE
SWOT
SPACE
BCG MATRI
X
IE MATRI
X
GSM
SWOT ANALYSIS
SWOT Matrix
STRENGHTS WEAKNESSES
1. Highest Market Share 1.Scarcity of Raw Materials
2. Low Price Vehicles 2. Lack of coordination with Govt. Bodies
3. Large Distribution Channel 3. Less focus on Looks and design
4. Highly Innovative & Deep product line 4. Less Technical Training Institutes
5. Easy availability of spare parts5. Less distribution channels in sub-urban areas
OPPORTUNITIES S-O Strategies W-O Strategies
1. Increasing Demand for cars 1. Maximize market share by producing more cars per year (S1,S2,O1,O4)2. Develop more efficient and innovative Engine which gives comparative advantage (S4,O2)3. Use efficient CNG systems (S4,S5,O4)
4. Focus on Looks and Design to compete with Honda and Toyota (W3,O1,O3)5. Fund and establish technical institutes to gain more skilled workforce (W4,O3,O1)
2. Efficient EFI engines
3. Large Market to Operate
4. Small size CNG Cylinder
5. Global Spare parts marketTHREATS S-T Strategies W-T Strategies
1. Tough Competitors
6. Maintain quality in affordable price will help to compete with competitors and imported cars (S2,S4,T1,T4)7. Develop fuel efficient engines to gain edge and eliminate threat of fuel prices increase (S4,S5,T5,T2)
8. Enhance distribution to avoid threat from second hand imported cars (W5,T4)
2. Inflation Rate
3. Heavy Taxes
4. Cheaper Imported Cars
5. Increase in Fuel prices
BCG MATRIX
Dogs
Question MarkStar
Cash Cows
High
Low
LowHigh
MarketGrowth
Market Share
MEHRAN
ALTO
CULTUS
RAVI
LIANA
APV
JIMNY
BOLANSWIFT
BCG MATRIX (CONT’)
SPACE MATRIXFinancial Strength (FS)
Return on Investment +4Working Capital +3Short Term Assets +4
TOTAL: +11Industry Strength (IS)
Large Market to operate +5Increasing per Capita Income +3Consumption Oriented Culture +4
TOTAL: +12Competitive Advantages (CA)
High Quality Products -3Sleek and Stylish Designs -4Famous Brand Names -3
TOTAL: -10Environmental Stability (ES)
Tough Competition -2Change in Govt. rules and regulations -3Imported Refurbished Cars -4Law and Order Situation -2
TOTAL: -11
SPACE MATRIX FS = 11/3 = 3.67 IS = 12/3 = 4 CA = -10/3 = -3.33 ES = -11/4 = -2.75 X-axis = IS+CA = 4-3.33 = 0.67 Y-axis = FS+ES = 3.67-2.75 = 0.92
SPACE MATRIX
CONSERVATIVE
DEFENSIVE COMPETITIVE
Aggressive Strategies
IE MATRIX
EFE Matrix Scores
IE Matrix Scores
Strong Average Weak
4
3 2 1
Strong 4
i ii iii
3Average
iv v vi
2
vii viii ix
Weak
1
GRAND STRATEGY MATRIX(GSM)Rapid Market Growth
Q1Q2
Q3 Q4
Slow Market Growth
Weak Competitive Position
Strong Competitive Position
• Market Development
• Product Development
Decision stage
Quantity strategic planning matrix
QSPM MATRIXMarket Development Product Development
External Factors WeightAttractiveness
Score
Total attractiveness
score
AttractivenessScore
Total attractiveness
scoreIncreasing Demand for Cars 0.10 4 0.40 4 0.40Efficient EFI engines 0.06 3 0.18 4 0.24Large Market to operate 0.08 4 0.32 4 0.32Global Spare parts market 0.04 3 0.12 2 0.08Tough competitors 0.08 4 0.32 2 0.16Inflation 0.06 1 0.06 1 0.06Cheaper Imported cars 0.08 4 0.32 4 0.32Increase in fuel prices 0.10 4 0.40 4 0.40
Internal FactorsHighest Market share 0.08 3 0.24 4 0.32Low price vehicles 0.10 1 0.10 4 0.40Large distribution channel 0.06 2 0.12 3 0.18Easy availability of spare parts 0.02 3 0.06 3 0.06Innovative and deep product line 0.06 4 0.24 3 0.18Less focus on style and design 0.04 4 0.16 4 0.16Scarcity of human resource 0.04 3 0.12 4 0.16Totals 1.0 3.16 3.44
THE FOLLOWING ARE THE FINDINGS OF THE STUDY OF PAK SUZUKI MOTOR COMPANY LIMITED.
EXTERNAL FACTOR EVALUATION MATRIX SCORE: 2.98
INTERNAL FACTOR EVALUATION MATRIX SCORE: 2.99
BCG MATRIX:
STAR: JIMNY, BOLNAQUESTION MARK: SWIFTCASH COWS: MEHRAN, CULTUS, ALTO, RAVIDOGS: APV, LIANA
conclusion
CONCLUSION (CONT’)Internal External Matrix: Growth and Built
StrategySpace Matrix: Quadrant 1, Aggressive StrategiesGrand Matrix: Quadrant 1, Aggressive StrategiesMarket Development, Product DevelopmentQSPM Matrix:
Market Development: 3.16Product Development: 3.44
Chosen Strategy is Product Development