Managing Organizational Change

Managing Organizational Change - Managing Organizational...

Info icon This preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
Managing Organizational Change Revolution at Oticon A/S (A): 1. What are the competitive requirements of Oticon in the audiology industry? Define a strategy for achieving competitive advantage in this industry. Compare and evaluate your strategy with the specific actions taken by Lars Kolind after assuming his position as CEO of Oticon A/S. Oticon was number one in market shares of 15% in worldwide hearing aids products in the end of the 70’ because their technology advancement in miniaturization enabled them for the mass production of hearing aids. This position was challenged by the invention of the ITE (in the ear hearing airs device) that was a better technological substitute than the BTE which dominated by Oticon. The market share of Oticon dropped from 15% to 7% by 1987 since the introduction of the ITE. Lacking the economies of scale from BTE, Oticon became the number three hearing aids behind Siemens Audiologische Technik (Erlangen, Germany) and Starkey (Minneapolis, USA). With these conditions, we can address the competitive requirements of Oticon in the audiology industry. Being number three is very difficult to sustain any profitable business because it can not compete with the market leaders in financial resources, marketing, brand equity, as well as technology creation with the companies like Siemens and Starkey. To survive they need to improve from their current strengths of high quality and high cost manufacturer to agile company with highly selected customer focus since quality hearing aids is the standard of regular products. The strategic plan for achieving competitive advantage in this industry can be addressed using 1) technology advancement 2) economies of scale 3) customers 4) organization innovation. The breakthrough invention of ITE that eroded the market share of BTE is the best way for any company to gain the competitive advantage. The know-how on how the mass produce the needed hearing aids can realize the economies of scales for the new invention like ITE. Targeting specific market segment for the best ROI as well as making a company more agile are also valid method to achieve competitive advantage in audiology industry. After Lars Kolind assumed the position of Oticon’s CEO, he cut 10-15% of corporate employees and loss-money businesses. He also realized that the company can not compete with two bigger competitors in technology, marketing and sales because of the financial resources. With these constraints, he could only try to focus on customers and organization innovation. Oticon was targeting the high-priced segment of the market as well as
Image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern