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Theory and Practice of Management

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Carl Prest

on 12 March 2014

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Transcript of Theory and Practice of Management

The differing fortunes of Faber Castell and Dixon Ticonderoga
A Brief History of Each Company
What is globalisation?
Challenges of

How each company has responded to these challenges

Contrast the management of each company

Management Lessons
1761: Faber Castell founded in Stein, Germany
1849: Opened a sales office in New York

1851: Followed with a branch in London

1855: And then a branch in Paris
1980: World’s largest eraser factory in Malaysia

2008: Produces in 10 countries and products sold in over 120

1812: Joseph Dixon makes his first pencil
1821: Joseph Dixon Crucible Company is founded

1913: The iconic Dixon Ticonderoga Pencil makes its debut

1983: Merger between Bryn Mawr and Dixon creating Dixon Ticonderoga

1994: American Government imposes heavy anti dumping duties on Chinese pencils

2004: FILA S.p.A acquires struggling Dixon

Ciara Svensen, Teodora Kavakliyska, Rachthep Khanijou, Carl Prest
The process by which businesses or other organizations develop international influence or start operating on an international scale.
Additional pressure
Flexible working
Did not expand their market-only stayed in USA for many years
Too many transport companies-streamline to less companies

Where did Dixon's management go wrong?
Dixon SWOT analysis
Faber Castell SWOT analysis
Dixon PEST analysis
Faber Castell PEST analysis
Dixon's responses to the challenges of globalisation
Reduce costs of production
Moved headquarters
Closed down inefficient plants
Dismissed unnecessary management
1994 anti-dumping duties
Benefits Dixon
Cheaper Indonesian wood
Imported erasers from Korea
Focused product lines
Individual Clients
Environmentally friendly crayon manufacture
Introduced Prang line
Too little too late
Only tried to go global in 2000
Bought in 2004 by Fila S.p.A
Chinese imports threaten domestic industry
Competitive intensity

Social interactions: migration and conflict

Increasing volatility

Challenges of globalisation
Faber Castell's responses to the challenges of globalisation
Spreading operations worldwide
Environmental and Social responsibility

Design and Innovation
Outstanding quality
Remained a 'Mittelstand' company
Decentralised structure

Undertake initiatives to protect the environment

Reforestation schemes in Brazil

Protection of biodiversity and preservation of natural resources

Faber-Castell social charter (2000)

Outstanding design procedures

Cutting edge innovation

“From the outset, I strove to rise to the highest position by producing the best that could be made in the whole world.”
(Lothar von Faber, 1869)

“Our operations are really not all that labor intensive, so the company has no real need to shift its work offshore or to Mexico as many U.S. Manufacturers have done"
- Gino Pala, 1991
Key management lessons
Opportunistic approaches to business
Maximum organisational agility
More flexible working patterns
Greater levels of functional flexibility
Faster and more frequent change
Set benchmark for 'best of its class'
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Jackson, J. (1999, July 19). Dixon ticonderoga sharpens focus on mexico. http://articles.orlandosentinel.com/1999-07-19/business/9907170277_1_pala-states-and-mexico-dixon-ticonderoga
Jackson, J. (1993, February 1). Pencil maker sharpens strategy. http://articles.orlandosentinel.com/1993-02-01/business/9301300881_1_pala-dixon-ticonderoga-pencil
Byrd, A. (2001, January 12). Pencils sales not as sharp in 2000.http://www.bizjournals.com/orlando/stories/2001/01/08/daily18.html
Bole, K. (1997, October 26). East europe's demand for free market still exceeds supply. http://www.bizjournals.com/sanfrancisco/stories/1997/10/27/newscolumn5.html?page=2
Faber-Castell, C. A. (2012, November). Interview by N Chalmers []. Count anton wolfgang von faber-castell., http://www.director.co.uk/MAGAZINE/2012/11_November/MBL_Count Anton Wolfgang von Faber-Castell_66_03.html
Nuremberg. (2010, September 16). The future of the pencil. http://www.economist.com/node/17043890
Stein. (2000, March 3). Faber-castell. http://www.bwint.org/default.asp?Index=45&Language=EN

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