Organizational Behaviour

Question Questions:1) What is your assessment of Daimler-Benz's operations in many different fields? 2) Should the various groups operate autonomously? What kinds of activities should be centralized? 3) Daimler-Benz is best known for its Mercedes-Benz cars. Why do you think Daimler bought AEG in the first place and why did it venture into the Aerospace and Inter Services businesses? 4) Given the apparent mistakes in acquiring non-automotive businesses, what should Jurgen Schrempp do now?

Questions:1) Prepare a profile of the potential buyer of the Lexus. 2) What should Mercedes and BMW do to counteract the Japanese threat in the United States and Europe? 3) Why has the Lexus model been very successful in the U.S. but has not been marketed in Japan?(Suggestion: Review the frequency of repair records of luxury cars. Also talk to Lexus dealers or Lexusowners). 4) Do you think Lexus will succeed in Japan? Why or why not ?

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Questions: 1) What is your assessment of Daimler-Benz's operations in many different fields?

Daimler-Benz, with more than 300,000 employees worldwide, consisted of four major groups: The first, by far the biggest and most successful group, was Mercedes-Benz with about 200,000 employees. It is best known for its passenger cars and commercial vehicles. [THIS BUSINESS UNIT HAS THE CORE COMPETENCE AND HENCE VERY SUCCESSFUL. --------------------------------------------------------------

The second was the AEG Daimler-Benz industries in the business of rail systems, microelectronics, heavy diesel engines, energy systems technology, and automation. [THIS BUSINESS UNIT HAS TOO MANY SUB-UNITS AND WIDE DIVERSIFICATION AND LACKS CORE COMPETENCY IN SOME WHICH AFFECTS THE OVERALL PERFORMANCE. ----------------------------------------------------------------------------

The third was the Aerospace Group in the business of aircraft (the company has a more than one-third interest in the Airbus consortium), space systems, defense and civil systems, and propulsion systems.

[THIS BUSINESS UNIT HAS MANY SUB-UNITS AND ARE INTEGRATED AND HAS THE CORE COMPETENCY / HENCE IS SUCCESSFUL.. ---------------------------------------------------------------------------- Finally, there was the Inter Services Group consisting of systemshaus, financial services, insurance brokerage, trading, marketing services, mobile communications services, and real estate management.

[THIS BUSINESS UNIT HAS TOO MANY SUB-UNITS AND WIDE DIVERSIFICATION AND LACKS CORE COMPETENCY IN SOME WHICH AFFECTS THE OVERALL PERFORMANCE. ============================================================= 2) Should the various groups operate autonomously? What kinds of activities should be centralized?

[THE BUSINESS UNITS SHOULD OPERATE AUTONOMOUSLY . THE KINDS OF ACTIVITIES THAT COULD CENTRALIZED ARE -IT SYSTEMS -HR SYSTEMS

-FINANCE ============================================ 3) Daimler-Benz is best known for its Mercedes-Benz cars. Why do you think Daimler bought AEG in the first place and why did it venture into the Aerospace and Inter Services businesses?

[ BETTER USE OF TECHNOLOGY AND COMPETENCE PLUS SALES OPPORTUNITIES. =========================================== 4) Given the apparent mistakes in acquiring non-automotive businesses, what should Jurgen Schrempp do now?

[ RE-ORGANIZE / RESTRUCTURE THE BUSINESS UNIT AND HIRE COMPETENT TALENTS TO RUN THE SHOW]

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Questions: 1) Prepare a profile of the potential buyer of the Lexus.

Target Customer Description The target customer with Lexusʼ flagship hybrid design is seeking to present a bold image to others. Price is therefore a secondary factor to the message their car portrays in their purchasing decisions. Potential customers are born within ten years of the “baby boomer” generation aged forty-five and up. As a wealthy and image-conscious person he/she can spend money freely, taking up hobbies and living a visibly envious life.

He/she purchases this car for its “green” status to benefit his/her self-image. They choose to purchase hybrids either because they are environmentally conscious, or they wish to appear to be. They combine extravagance and excess with environmental care by purchasing a car that is both “green,” and also features top-of-the-line technology, performance, and luxury.

2) What should Mercedes and BMW do to counteract the Japanese threat in the United States and Europe?

[BOTH MERC / BMW HAVE QUALITY PRODUCT/ PRODUCT POSITIONING. THEY NEED TO STUDY THE MARKET AND DEVELOP A SEMI-LUXURY BRAND TO MATCH ‘’LEXUS’’ ------------------------------------------------------------------

3) Why has the Lexus model been very successful in the U.S. but has not been marketed in Japan? (Suggestion: Review the frequency of repair records of luxury cars. Also talk to Lexus dealers or Lexus owners).

[ IN THE US CAR MARKET , THERE WAS A GAP BETWEEN MERC/BMW AND THE LOCAL BRANDS. THIS IS WHERE THE LEXUS FITTED IN WELL WITH THEIR PRICE/ PROFILE] ------------------------------------------------------------

4) Do you think Lexus will succeed in Japan? Why or why not?

LEXUS CAN SUCCEED IN JAPAN, PROVIDED IT IS POSITIONED PROPERLY.