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Husky Injection Moulding Systems - Strategic Recommendations

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Laura Duran

on 2 February 2016

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Transcript of Husky Injection Moulding Systems - Strategic Recommendations

Husky Injection Moulding Systems - Strategic Recommendations

Husky's strategy... until 1995
Husky followed a successful differentiation focus strategy.

It's success peaked in 1995.
Industry-level
problem
Husky should not worry about the predicted shortage of PET resin in 1996.
Keep differentiation focus strategy...
Husky's competitve advantage comes from its superior machines, reliability and service.

Switching to cost-focus or cost-leadership will fail. Husky lacks the necessary economies of scale of larger competitors.
... whilst cutting down waste
A differentiation focus strategy should not lose sight of costs incurred.

Husky should follow a strategic lean approach to process design.
The core threat:
company-level
Lower-cost companies entering Husky’s most profitable markets.
The future - recycled PET
Trend in global plastic industry towards extensive recycling.

"The injection molding factory of the future".
The injection moulding systems industry until 1995
Husky entered the niche of PET and thinwall processing machine manufacturing.

Low entry barriers

15 major players
Why did Husky succeed in this market?
Technical superiority of their machines.

Ability to target niche customers in high-volume markets.

Focus on fast innovation.

Excellent customer service.
Why didn't other companies compete there already?
Focus on standardised machines and achieving economies of scale.

Lack of internal capabilities to produce technically superior machines.

No extensive customer service.
Customers want machines that can operate for longer using less resin.

Husky machines...
Focus capabilities on what customers really want
Invest in the Advanced Manufacturing Centre (AMC) - continue to develop superior machines.

Stay at the forefront of tech superiority.

Invest in marketing and training of salesforce.
Make clients understand their real cost savings from using Husky machines.
Identify waste
In the product portfolio:
Services delivered to companies outside niche markets.

In the production process:
Early stage customisation.
Apply lean principles
Focus exclusively on projects for customers in the PET and thinwall niche.

Customise machines at a later stage.

Share research insights with suppliers and mold makers.
Our reasoning
The price of resin started to rise in 1994 - this was a market phenomenon that would balance out eventually.

The supply of resin is predicted to pick up from 1997.
How to react
Strengthen relationship with major clients through excellent customer service...

... even if they do not purchase machines!

This will halt the fall in market share in the short-term.
Value for money


Swiss engineering - reputation for excellence.
Economies of scale from Mannesman Group.
More efficient production system.
More specialised machines than other competitors in the market.
Premium pricing strategy.
Lower costs
Husky's internal
capabilities
A 25 million dollar worth innovation centre.

Expertise and knowledge in the PET industry.

A client portfolio increasingly concerned with environmental issues.

Strong corporate concern for environmental conservation.

Netstal
Exploited economies of scale and scope.
Acquisition of Ferromatik brought in expertise in PET moulding systems.
Manufacturing increasingly better machines.
International expansion of low-end product ranges into Asian market.
Cincinnati Milacron
Understand your product better
can make 35 million more preforms per year...
will save a processor up to $870/machine in floorspace per year...
can produce 100 preforms for 89c vs 99c ...

... compared to major competitors' machines.
Alison Harvey
Laura Sans Durán
Lisa Sweering


Target the right customers in the PET and thinwall niche
Involve engineers in the sales process.
What is injection molding?
Full transcript