Rolls Royce Case Study.pdf - Rolls Royce Case Study Rolls Royce the most powerful symbol of British manufacturing Company \u25cf \u25cf A British MNE the

Rolls Royce Case Study.pdf - Rolls Royce Case Study Rolls...

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Unformatted text preview: Rolls Royce Case Study Rolls Royce: the most powerful symbol of British manufacturing. Company ● ● A British MNE & the world's second biggest manufacturer of large jet engines. About 85% of its revenues are derived from abroad Context Main Issue The jet engine industry offered fierce competition & no company could maintain a technological edge. The challenge of creating and maintaining a competitive advantage in a highly evolved, global industry. THEORY National Competitive Advantage: Porter’s Diamond Firm Strategy, Structure & Rivalry ● Conservative Government nationalising the company in 1971. ● In 2001, the British taxpayer lent £250m to Rolls-Royce to help develop bigger jet engines; in 2006 it agreed to give grants of £47m to a group led by Rolls-Royce to design an environmentally friendly engine. ● However, other nations have been far more generous & the lure of subsidies and other incentives from foreign governments has become increasingly strong. Demand Conditions ● Ignited by British Military demands in 1914. ● Sustained by ‘local’ demand (British Airways and Airbus). ● Demand evolved from international airlines (Air China, Qatar Airways, Emirates). ● To better compete in the international playing field Rolls-Royce had to differentiate themselves to create demand for their product. ca tio ( wo skil n se rkf led cto or r ce ) stry Aero engine manufacturing industry indu Ed u R&D Raw ma supp terial liers Manufacturing industry e gin ce n n e ro tena e A in a m Related and Supporting Industries Factor Conditions ● ● Basic factors —— Institutional resources light - touch regulations —— Capital resources tax - breaks —— Human resources foreign talent Advanced factors —— R & D bundle service What we have learned. Rolls-Royce's embrace of globalisation remains the chief cause of its success & an essential precursor to its innovations, which begs the question: How important is taking a national advantage? Our opinion: National Advantage ---> Consistent Innovation ---> International Success Questions What do you think was the foremost factor that contributed to Rolls Royce’s success? Should Rolls Royce move its manufacturing facilities abroad in search of incentives & subsidies? Why/Why not? What ethical considerations might there be when blending services and manufacturing as Rolls Royce have? How is having a National Advantage key to an organization's ongoing International Success? Thank you. ...
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