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    Assignment Shimano Case

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    Naresh Sehdev
    Shimano overcame the power of frame makers by bundling components into modular packages that defined performance levels. They offered tiered component groups from highest to lowest quality and slashed prices, which hurt competitors. Shimano also filed lawsuits over patent infringements. Their commitment to R&D and technological strength in cold forging metal processing allowed highly precise, mass produced parts that were used globally in cycling events.

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    Assignment Shimano Case

    Uploaded by

    Naresh Sehdev
    791 views2 pages
    Shimano overcame the power of frame makers by bundling components into modular packages that defined performance levels. They offered tiered component groups from highest to lowest quality and slashed prices, which hurt competitors. Shimano also filed lawsuits over patent infringements. Their commitment to R&D and technological strength in cold forging metal processing allowed highly precise, mass produced parts that were used globally in cycling events.

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    Executive MBA case study And assignments +918527018189 +919972548875

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    Shimano overcame the power of frame makers by bundling components into modular packages that defined performance levels. They offered tiered component groups from highest to lowest quality and slashed prices, which hurt competitors. Shimano also filed lawsuits over patent infringements. Their commitment to R&D and technological strength in cold forging metal processing allowed highly precise, mass produced parts that were used globally in cycling events.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    791 views2 pages

    Assignment Shimano Case

    Uploaded by

    Naresh Sehdev
    Shimano overcame the power of frame makers by bundling components into modular packages that defined performance levels. They offered tiered component groups from highest to lowest quality and slashed prices, which hurt competitors. Shimano also filed lawsuits over patent infringements. Their commitment to R&D and technological strength in cold forging metal processing allowed highly precise, mass produced parts that were used globally in cycling events.

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    © All Rights Reserved
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    Download as docx, pdf, or txt
    of 2

    1

    Q1 How did deal with the rivalry problem?

    Commitment to customer relations.


    Would focus on developing more user-friendly machines.
    With technology were a carefully intertwined production and marketing team

    Called the “Intel of the bike business :Eighty percent of the company’s bicycle component sales were
    from high-end components and most of the rest were for mid-range components
    Stackelberg Leader: In the 1980s, high gasoline prices encouraged a further increase in bike sales. Then
    there was a surge in mountain bike sales in the 1990s this helped to revive public interest in road bike
    and Shimano took the lead.
    Extreme coordination for any major change, integrated approach as in the case of it is here that
    architectural changes have occurred (in linked mechanical components).

    Diversification: During slump, some bike manufacturers who were unable to improve earnings by
    focusing on the high-end market did not survive—GT/Schwinn’s demise in 2000 was an example
    (eventually they were acquired by Pacific Cycle); Shimano still able to survive

    Product quality and technological superiority: to have a “powerful brand,” consisting of “top quality”
    products, with a “global presence” .Marginal utility increased.
     Shimano completed development of its index shifting system : The shifting gave riders more
    confidence and reliability during races because racers could lose important seconds during a
    race using the old system of shifting.
     Best was a mechanical integration of shifters into the brake levers. This innovation allowed
    racers to accurately shift without letting go of the handlebars.
     Finally, Shimano completely redesigned its gear shift so that it suited mountain bikes aft
    Shimano emerged with a 15-speed mountain-biking components in 1982 and later 21-speed.
     Other innovations included a computer-designed elliptically shaped chain wheel, which
    increased pedaling efficiency and reduced biker fatigue.

    Working on exclusive concept stores, dealer penetration, and ways to manage the retail channel.
    2

    Q2 . How did they as component supplier, overcome power of frame makers?

    Set global prices firmly in order to eliminate arbitrage (gray market) issues and also to reduce antitrust
    potential.

    Shimano Slashing prices of its shifters by 60 percent in 1996, , and competitor SRAM’s revenues fell to
    $40 million from $70 million.

    Filed a lawsuit against the newer player, SRAM in 2004, alleging that the company infringed Shimano’s
    shift indicator patent—SRAM had hit a home run in 2003 with its updated trigger shifters

    “System Components” :

     Bundling idea Bundled derailleurs, brakes, shifters, pedals, cranks, and other components into
    tiered, modular packages (groups), which “much to the bike manufacturers’ chagrin, have come
    to define the bicycle’s performance level.
     Offered components (from highest to lowest quality.
     Higher-end components were usually lighter, more durable, and had better performance
    characteristics.

    Technological prowess

     Company’s commitment to R&D.


     Technological strength was its metal processing, centered on cold forging, a technology where
    metal objects are formed at room temperature without heating.
     Shimano’s Cold forging led to a high degree of precision and was suited for mass production of
    small metal parts.
     Parts were used by cycling professionals and others in major cycling events around the world.
     with technology were a carefully intertwined production and marketing team

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