Bowman’s Strategy Clock
Cliff Bowman has developed this strategic clock for to arrive at the organisations competitive
position in comparison to the offerings of competitors. Comparing with Porter’s Generic
Strategies here Bowman describes about the competitive advantage comparing with the cost
or differentiation advantage. He brings out six core strategic options that where the
companies could fall into.
Here Asian Paints Limited (APL) follows the Hybrid Strategy (route 3). An organisation is
said to be following hybrid strategy (which has greater perceived value than a low priced but
less than that of a differentiated product) if it seeks to simultaneously achieve both the
differentiation and low price comparatively with the competitors. These companies take the
advantage of Economies of Scale (EOC), cost reduction though come up with differentiation.
The below shown is the position of Asian Paints Limited (APL) on the Bowman’s Strategy
Clock which is plotted between the perceived value of product/service and price of the
product.
To describe how APL falls under the hybrid strategy we will consider one of its competitors
ICI (Imperial Chemical Industries) with a market share of 17%. Catering to different
segments by APL and ICI is shown in below. We can observe that in the categories
Emulsions and Exteriors APL differentiates its product from ICI by providing an economic
product which could be afford by any customer. Whereas under Distemper ICI provides only
economic products but Asian Paints again differentiates itself by providing both the economic
and premium brands. On the other hand coming to Enamels while both the companies caters
to premium segment but only APL could be able to come up with first and second quality
Enamels. Not only within the categories but even in the product line also APL follows the
differentiation strategy with additional products like Powder Coatings and Wood Finishers.
With a huge market share of 55% which is more than double of its nearest competitor
(Nerolac with 20% of the market share) Asian paints has the advantage of utilizing its
economies of scale for coming up with low priced and differentiated products which is
termed as Hybrid Strategy according to Bowman’s Strategic Clock.
Source: report by Asit C.Mehta, Investment Intermediates Limited.
Website:investmentz.com
Acquisitions and Collaborations
APL followed both organic and inorganic path for its growth strategy. It has acquired, came
up with different corporate brands, subsidiaries (which are 100% self owned) and jointly
ventured for achieving its market leader position in more than eight countries.
Berger
It is started by a German chemist, grew big with many wings across various countries and
then later in the year 1994 all the units were grouped under BIL (Berger International
Limited). Now it became the part of Asian Paints with 100% being under the control of APL.
APL operates in eight global markets through Berger.
Apco Coatings
This is also another subsidiary 100% owned by Asian Paints catering to the South Pacific
Islands like Australia, Fiji and others.
Taubmans
This became part of APL in 2003 for selling its products to Samoa islands.
SCIB (Study Construction and Industrial Buildings)
It is an Egypt based company which is founded in the year 1979 and first to introduce water
based Enamel. It became United Paints and Chemicals (UPC) when it joined hands with OCI
(Orascom Construction Industries). In 2002 SCIB partnered with APL and runs under its
control in Egypt.
Asian PPG
This is a pure 50:50 joint venture between Asian Paints Limited (India) and PPG Industries
which is US based company catering to automobile industry in India. These two came
together to make stronger with efficient technology, understanding of customer needs and
manufacturing.
Source: http://www.asianpaints.com/corporate_information/group_subsidaries.aspx
Functional Strategies
Human Resources (HR)
Human Resources (HR) which is a thrust area for Asian Paints promotes coaching within
the organisation and integrates it in the overall development of human resources.
Asian Paints has partnered with Australian Results Coaching Systems for developing the
managers as coaches.
A set of activities were conducted at various levels in technology department for
improving the nature of work towards innovation.
The company follows a Performance Management System to encourage the employees.
It takes the effort to reach all of its employees every year.
Source: Asian Paints Limited-annual report 2008-09
Organisational Structure
Asian Paints has a great presence throughout the country enabling them to reach the
maximum dealers (19000) and thereby increase its penetration in to the market. It also
helps APL to manage its inventory effectively which is vital factor in paint industry.
The organisation follows a simple and efficient supply chain for its distribution right from
procuring the raw materials to end consumers.
It is the first paint company to provide home painting solutions worldwide. The workflow
of this home solution is shown below. This service helps the company to get in touch with
its customers and get the primary information about their changing tastes before the
competitors could know.
A continuous research and development is a primary as discussed in the value chain
process. It has two divisions under its R&D namely Customer oriented and Company
oriented.
Source: report by Asit C.Mehta, Investment Intermediates Limited.
Website:investmentz.com
Marketing Strategy
Asian Paints had built a great brand in the paint industry and the credit should go to
well known the global advertising agency Ogilvy and Mather.
APL changed the perception of paint totally form low involvement to a high
involvement product by changing its earlier strategy of targeting mass and building
up the network.
Though it failed initially later it changed its perception to premium brand by
discovering and positioning as a happy moment during festivals.
Then this campaign was fragmented as other players started using the similar type of
positioning. Through continuous innovation of products and campaigns as well, APL
has developed a huge brand image.
Source: http://marketingpractice.blogspot.com/2007/03/asian-paints-every-color-tells-story.html
