Case analysis on bmw

this may help you.

1. WELCOMEWELCOME

2. BMW(Bayerische Motoren Werke)
Titans are
Ruhul Amin
Nusrat Mehzabin
Koushik Ahmed Tushar
M.M. Abdullah              

3. BMW(Bayerische Motoren Werke)
Bayerische  Motoren  Werke  AG(BMW), 
(English:  Bavarian  Motor  Works)  is  a 
German automobile, motorcycle and engine 
manufacturing company.
BMW was originally founded in 1916, by 
Franz Josef Popp.

4. Overview of BMW
Industry: Automotive
Founded: 7 March 1916; 100 years ago
Founder: Franz Josef Popp, Karl 
Rapp, Camillo Castiglioni
Headquarters:
Munich, Bavaria, Germany
Area served : Worldwide
Products: Luxury vehicles, sports 
cars,motorcycles, bicycles
Slogan: "Sheer Driving Pleasure" 
(Worldwide)

5. Overview of BMW
BMW Mission Statement:
  “We will sell our products with the highest quality and integrity.” 
BMW Vision:
    Current vision is to treat their customers like “F.A.M.I.L.Y.” 
    The F stands for family treatment, 
           A stands for attitude, 
           M stands for more than the customers expects, 
           I stands for individual attention and enthusiasm, 
           L stands for like an honored guest and the 
           Y stands for you make the difference. 
Major Competitors:
    BMW has four main competitors: Audi, Mercedes, Lexus, and Porsche. The two 
bigger competitors are Audi and Mercedes.

6. SWOT Analysis of BMW
Strengths:
BMW group
Innovation & technological advancement
Renowned brand in automobile industry
Workforce
Product portfolio
Asian markets
Plans for hybrid models

7. SWOT Analysis of BMW
Weaknesses
Cars recalled
Strategic alliances
Younger generation less brand conscious 
Opportunities
Increasing product portfolio
Changing lifestyle & customer groups
Market expansion
Threats
Competition
Price factor
Rising fuel problems 

8. BMW –Your Dream Car
Presented By –
Kowshik Ahmed Tusar
S.N:20111105011

9. PESTEL AnALySiS
P- Political
E- Economical
S- Social
T- Technological
E- Ecological
L- Legal

10. PESTEL AnALySiS
Political
Enforcement of new laws related to CO2 emission.
Change in EU legislation related to end-of-life vehicle (ELV)
recycling
Level of political stability in emerging countries
Possibility of the UK to stop its EU membership
Economical
Volatility of GBP: EURO exchange rates
Appreciation of Renminbi (RMB) of 1% to 2% during 2012
Vast GDP fluctuations in EU countries during the last few years
Volatility of price for crude oil

11. PESTEL AnALySiS
Social
Ageing population in European markets
Changing family patterns (increasing numbers of same sex
marriages, single parents etc.)
Changing consumer attitudes towards savings and spending
Rising life expectancy in developed countries
Technological
Increasing levels of popularity of “green” technologies
Technological breakthroughs in auto manufacturing industry
Integration of internet-enabled technologies in automobile
industry
Increasing levels of demand for alternative fuels
Realization of the concept of driverless car

12. PESTEL AnALySiS
Legal
Changes in employee health and safety rules and regulations
Patents and Copyrights in relation to innovation on auto
devices and functionalities
Changes in laws and regulations specific to car
manufacturing sector
Changes to relevant EU Directives
Ecological
Increasing levels of consumer concern towards “green”
products
Effects of non-government environmental organizations
Changes in waste management practices

13. VALuE ChAin AnALySiS
The value chain concept developed by Michael E Porter
provides as ystematic means of categorizing activities
and functions of an organization, illustrating the
creation of value for customers. It helps the company to
determine which activities create value and which do
not. When the value chain is capable of creating
additional value at no additional cost, a competitive
advantage is realized.

14. RESouRCE-BASEd ViEw
STRATEgy
The resource-based view identifies the
distinctiveness of BMW’s superior performance
and competitive advantage to generate unique
creations of product and service at lower cost
which enables it to earn higher profits.

15. RESouRCE-BASEd ViEw
STRATEgy of Bmw
Resource Competencies
Threshold CapabilitiesIntegrated supply
chain
Young employees
Wide spread assemble
and production units
High quality products
and service
Technical design
knowledge
Capabilities for
Competitive Advantage
Engineering
Excellence
Value added work
force
Brand management
Made-to-order cars
Technology and ability
to translate new
technical knowledge
into product and service
for customers

16. BMW –Your Dream Car
Presented By –
MM.ABDULLAH
S.N:20111105009

17. Presentation Topic
Porter’s Five Forces analysis of BMW:
Competitor Analysis:
Key success factor of BMW:
Generic strategy:
Cost Leadership of BMW:
Differentiation strategy of BMW:
Focus strategy of BMW:
Grand strategy
Concentrated strategy:
Product development strategy:
Market development strategy of BMW:
Strategy of Bmw for emerging markets:
Environmentally-friendly design strategy

19. Competitor Analysis
Primary Competitor:
 DaimlerChrysler
 Toyota
 General Motors
 Ford
Main Competitor:
Mercedes Benz…………..
LEXUS
Audi

20. BMW VS COMPETITORS
ENTRY LEVEL
SEDANS
FLAGSHIP
SEDANS
MID LEVEL
SEDANS
B
M
W
A
C
U
R
A
I
N
F
I
N
I
T
I
L
E
X
U
S

21. Key Success factor of BMW
1.Customers----
2.Corporations….
3.Competitors….

23. Identification and selection of long-term
objectives and strategies:
Generic strategy: Michael Porter developed three generic strategies, that a company
could use to gain competitive advantage, back in 1980. These three are:
Cost Leadership of BMW:
Differentiation strategy of BMW:
Focus strategy of BMW:

24. Identification and selection of long-term
objectives and strategies:
Grand strategy: A grand strategy states the means that will be used to achieve
long-term objectives. Examples of business grand strategies that can be
customized for a specific firm include:
Concentrated strategy:
Product development strategy:
Market development strategy of BMW:
Strategy of BMW for emerging markets:
Environmentally-friendly design strategy
Customer-focus orientation strategy:

25. BMW –Your Dream Car
Presented By –
Ruhul Amin
S.N:20111105003

26. Grand strategy of BMW
Innovation: Innovation is a grand strategy that seeks to reap the premium margins associated with
creation and customer acceptance of a new product or service. The underlying rationale of the
innovation is to create a new product life cycle and thereby make similar existing products
obsolete. But few innovative ideas prove profitable because R&D and premarketing costs of
converting a promising idea into a profitable product and service are extremely high.
In this case BMW is successful enough. BMW’s brand image is tied highly to such innovation. It
introduces the consumers in quick succession to the Rolls Royce, Z4 roadster, 5 series Sedan, 7
series Sedan, X3, 6 series coup, 1 series subcompact, Bavarian, M3 and so on.
It had to increase 53% R&D costs, 75% increase capital expenditures, had to build $1.5 billion
factory, employ 5500 worker, train the first 400 in 2001 to produce and distribute Bavarian Giant,
new model car.
05/05/16 26
4/24/2016 12:15 PM

27. Grand strategy of BMW
Vertical integration: It is a grand strategy based on the acquisition of firms that supply the
acquiring firm with inputs or new customers for its outputs. BMW adopts both backward and
forward vertical integration.
Backward vertical integration: To speed up the upcoming X3 to market, BMW outsourced
development and production to Austria’s Magna International Inc., a unit of Canadian-based
supplier and engineering services.
Forward vertical integration: BMW takes lease strategy to sell the cars. Up to 75% of its
Luxury 7series Sedan and 50% of the 5series Sedan are leased in USA.
05/05/16
4/24/2016 12:15 PM
27

28. Grand strategy of BMW
Global integration matrix:
 
 
Global strategy
 
 
Transnational strategy
 
International strategy
 
Multi-domestic strategy
Global 
integration 
National responsiveness 
High 
low High 
Low 
05/05/16
4/24/2016 12:15 PM
28

29. Grand strategy of BMW
Grand strategy selection matrix:
05/05/16
4/24/2016 12:32 PM
29
Overcome 
weakness
Maximize
Strengths
Internal (Redirected 
resources within 
the firms)
External 
(acquisition or 
merger for 
resource 
capability)
Turnaround 
Divesture
Liquidation 
Vertical integration 
Conglomerate 
diversification 
Concentrated growth
Market development
Product development
Innovation
Horizontal integration
Concentric diversification
Joint venture

30. Strategy implementation, control and innovation:
Organizational Structure: 
As mentioned previously, BMW AG is headquartered in Munich and has operations around the
globe. The business is headed by two boards, as is typical of German public organizations: by a
Board of Management, which is responsible and accountable for the operations, and by a
Supervisory Board, which meets with the Board of Management to discuss the status of
strategies. The Supervisory Board has the authority to hire and fire members of the Board of
Management and represents two groups, stockholders and employees, with each group comprising
half of the board membership.
05/05/16
4/24/2016 12:16 PM
30

31. Strategy implementation, control and innovation:
Management Style:
While management is hierarchical, each BMW employee is empowered to make decisions if they
have the competency to do so. However, it is expected that decisions not be made haphazardly;
planning is expected for any decision. After the purchase of Rover, BMW CFO Stefan Krause
said: “We don’t want to waste money on trying things.” (Chief Executive Group L.P., 2003).
Management tends to be low-key, but extremely focused, and has experience from a variety of
functional areas. For example, Panke actually started his career as a nuclear physicist, hired by
McKinsey & Company as a consultant for BMW before eventually being employed full-time.
Panke’s management style is said to be very open and conducive in fostering debate among
management to generate new ideas and to solve problems; he expects entry- level employees to
raise sensitive issues through the ranks.
05/05/16
4/24/2016 12:16 PM
31

32. Strategy implementation, control and innovation:
Controls for Employee Behavior & Performance: For employees located in Germany, one-page
reviews are given by supervisors. Employees are graded on five criteria:
• Work Quantity (number of projects)
• Work Quality (regarding project content)
• Intensity of the Work, Engagement, & Excitement
• Diligence, Precision, & Accuracy
• Teamwork
05/05/16
4/24/2016 12:16 PM
32

33. Recommendations
Now the recommendations based on the case analysis are as to:
BMW should diversify their market,
They should diversify and extend the cost-effective products lines besides the Luxurious Sedan
series, Bavarian Giant and this will help them to increase sales..
The BMW should not be confined to only the developed market but expand their market to
developing and emerging markets like China, India.
Their production and distribution facilities should not be confined only to domestic and primary
markets.
They should not be confined to only leasing but provide licensing and franchising agreement
with foreign distributors.
They should adopt consortia grand strategy because it will help them to add global partners to
reduce cost.
05/05/16
4/24/2016 12:17 PM
33

34. 05/05/16 34