Sharp Corporation - Beyond Japan: Case Study Executive Summary: Faced with major losses from operations, Sharp Corporation’s president, Mikio Katayama, questioned the whether it was necessary to reform the current business operating model. Sharp’s current operating model contained several flaws. It placed sensitive, high-value-added operations such as research, development, and component manufacturing near its headquarters in Japan. Faced with threats such as intense industry competition, currency risks, very high transportation and utility costs, and extremely high infrastructure costs and high corporate tax rates, Sharp Corporation needs resources in the forms of new methods, technology, and approaches to doing business in the modern world. It is recommended that the company remodels their operating model in order to emphasize cooperation with other firms. Cooperation with other firms can take place in many forms, such as partnerships and joint ventures, and provides firms with many advantages. Sharp will greatly benefit from cooperative agreements since they are cost effective, provide financial support, and allow for more creative brainstorming. In addition, the economic risk is shared, and firms may help each other to tap into new technologies, methods, and approaches. Sharp Corporation needs outside help in order to achieve a turnaround. Joint ventures and partnerships with other firms open up the venue for such need. Problem Statement: Sharp Corporation is currently struggling with its financial position, aiming to achieve a turnaround in order to increase their sales revenue, capital, and finance, and ensure a sustainable future. The decision maker in this case, Mikio Katayama, President of Sharp Corporation, must reconsider the current operating model and develop an approach that is more suitable for current industry conditions. Analysis:
In order to identify the underlying causes of the core problem, the strengths, weaknesses, opportunities, and threats of Sharp Corporation must be examined. Please refer to Appendix A for full SWOT analysis. Sharp has a strong international presence and is a well known brand. It offers a variety of diverse products to its customers, including TV’s, laptops, and home appliances. A diversification of product portfolio is important as it protects company against risk of exposure in any particular line of business (Johnson, 2006). Therefore Sharp is relatively strong in this aspect. In addition, Sharp places an intense focus on research and development of new technologies and products, ensuring that their output is the best in the industry. Opportunities for Sharp Corporation increase over time as the demand for technology is constantly increasing in the world. This presents the company with many potential opportunities to explore new and emerging markets in order to expand its international market share (Dubovskiy, 2012). In addition to the steadily growing market, Sharp’s new Sakai facility involved numerous partners including co-located suppliers as well firms using the output from the plant (Lehmburg, 2012). These opportunities to create
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- Spring '00
- Business, Marketing, Product life cycle management, Sharp Corporation