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Able Corporation

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As members of the senior management team of Able Corporation, your group has been asked to prepare a neat and organized report for the Strategic Officers Steering Committee (SOS-C) of Walden International, the parent company of Able Corporation. The purpose of this paper is to obtain permission from them to go forward with the next step (developing a full blown business plan) for Able's strategic initiative to break into the global marketplace.

A complete SWOT analysis (strengths, weaknesses, opportunities and threats, including at least five factors from each category and full explanations of why each factor is important and why it was placed in the category) of the environment that exists within Able and the environment Able is proposing.

A preliminary outline of the business plan to be developed for Able's strategic initiative

A rudimentary mission statement

Key operating principles

A preliminary market analysis

The one-year, five-year, and ten-year strategic objectives of the strategic initiatives presented as one strategic proposal for each timeframe (three strategic proposals in all) complete with implementation plans, potential ramifications, and feedback mechanisms


Identify examples of good and bad business practices in the use of strategy design components.

Research and discuss some of the changes occurring in the way that organizations structure themselves and their work.

Develop plans to improve business operations.

Use effective communication techniques.

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SWOT Analysis

In the strengths and weaknesses are placed the internal factors. Thos factors that are internal to Able Corporation and are directly controllable by Able Corporation

Women own enterprise. This is an important factor and has been placed because women owned firms have a high credibility and are believed to be more reliable.

Brand name of Able Corporation: This gives high recognition to Able Corporation services/products and acceptance by customers.

Strong history: Able Corporation has the experience from its history of providing excellent service to its customers.
Large market share: The Company has a large market share in circular saws and this will enable it to earn more profits.
Good website: The website of Able Corporation is excellent and easily enables a customer to make purchases.


Marketing Communications: Able Corporation is weak in marketing communications and this leads to weak sales. This is an internal factor.

Innovation: The present innovations of Able Corporation are weak and have not got a good reception from the customers. This is an internal factor and so a weakness.

Low quality of tools: The present tools of Able Corporation have not been perceived by customers to be of a good quality. This is an internal factor.

Poor training of employees; it has been perceived that Able Corporation employees are not well trained. This is an internal factor.

Obsolete plants: The plants of Able Corporation do not incorporate the latest technology. This is an internal factor

The opportunities and threats are external factors:


Cordless Tools have good ...

Solution Summary

This answer provides you an excellent discussion on Able Corporation

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Able Competitors

Let's look at two of Able Corporation's two major competitors: Smith & White Corporation (S&W), a very large and aggressive domestic manufacturer, and Makatume, a Japanese powerhouse.

Smith & White markets a full line of moderate quality professional and consumer tools. It also markets such products as lawn and garden, hobby tools, and kitchen appliances, all under the same brand name as its power tools. It is a multi-national conglomerate that has dominant shares in all the markets in which it operates. Its strength lies in a unified strategy across all its product lines, power tool and non-power tool, of building and maintaining brand equity through massive amounts of national media advertising. The leverage gained through strong brand equity compels retailers, particularly the Big Boxes, to stock many of the S&W's products because of high end-user demand.

This demand-pull marketing strategy also has the synergistic effects of obtaining relatively higher prices, advanced placement, co-op advertising, high profile self space, and cross promotion.

S&W does have some significant weaknesses. These include high costs due to old manufacturing plants located in high labor cost urban areas, market confusion between its professional and consumer tools, and negative feelings on the part of its distributors stemming from a perceived abuse of their dominant market position. It also doesn't have much of a presence in the fast growing cordless segment.

In addition, a major hidden weakness is S&W's huge size, which makes it unwieldy in reacting to market phenomena during periods of rapid change.

Makatume markets only professional tools, which are highly regarded by tradesmen for their quality, robustness, and durability. It controls over 50% of the Japanese market and has leveraged that position to become the second biggest player in the U.S. market. For the past several years their sales in the U.S. have been aided by favorable exchange rates, although many economists now forecast a reversal of this advantage over the next two years. Makatume has an extremely strong cost position due to its relatively new manufacturing plants in Japan.

Makatume's greatest product strength is in the fast growing cordless segment. It controls a dominant 70% market share of the professional cordless market. Makatume's early entry into this segment, is both a blessing and a curse. By entering the market early, Makatume has been able to obtain its dominant market share, but it is now locked in to lower voltages due to wide acceptance of its interchangeable battery system. As the technology of battery efficiency progresses, Makatume is faced with a dilemma: Does it introduce its own higher voltages, thus legitimizing that market for others to enter, or does it wait until it has to respond to being outflanked by its competitors when and if they introduce their higher voltages?

The rest of the market is made up of several domestic and foreign niche competitors, none of which has greater than a 5% share of the total market. A phenomenon to watch, however, is the growing strength of Far East imports from China, which are beginning to make their impact on consumer tools because of their low price and good value. The yuan is the relevant currency affecting Chinese imports.

We can often better see ourselves when reflected through the perspectives of others. In this exercise you are to take the vantage point of the industry leaders, S&W and Makatume. This has the advantage of helping to anticipate competitive positioning that may effect the successful execution of Able's strategy. Based on the narrative above, please answer the following questions from the perspective of being their Director of Strategic Planning and Analysis. (For real world situations always keep in mind that the status and plans of competitors can almost never be known except through an analysis of their actions, and even then almost never with certainty. Dealing with imperfect information is one of the essential aspects of the economic problem.)

? How would you address each company's weakness?
? If you were Makatume, what would you do about higher voltages?

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