W.L. Gore Case Write – Up
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W.L. Gore Case Write – Up
Introduction and Decision Problem
W.L. Gore and Associates Inc is a company that manufactures fluoropolymer products and fluoropolymer fabric for the medical and electronics products company. This company also produces cables and assemblies, clothing, fibers, pharmaceutical gaskets, filtration products, and electrochemical and electronic materials. The company deals with materials science, in which it serves diverse industries. Gore also caters to the aerospace, computer telecommunication, energy, chemical processing, automotive, and military. This Company has other manufacturing facilities in China, U.K. Germany, U.S., and Japan. The headquarters of the company is located in Delaware, the United States. Just like any other company, this company also has its challenges, which it has to deal with at all times, and the primary one, in this case, is competition. The managers have to meet quite often for them to deliberate on the decisions that will make the company deal with the challenges that it faces.
- Situation Analysis (SWOT)
- Internal Analysis (Company)
- Strengths
Gore has a diverse portfolio of products. It markets many industries globally, including the medical sector, IT, electronics, telecommunication, and aeronautics. This kind of diversity makes the company have some sort of protection in terms of finances in case there will be any kind of negativity in a particular market segment. The other strength of this company is the fact that it has portrayed exemplary financial performance for long, as well as strong growth. The company has made a profit for 37 consecutive years, and it has always been among the top 10% of the Fortune 500 companies. The company has significant patents, trade secrets, and proprietary intellectual. Therefore, it efficiently strengthens its market share.
- Weaknesses
The primary limitation of Gore is that its products stem from one source of technology, PTFE. Thus, to some extent, this company limits itself because it depends too much on PTFE. Therefore, it also limits the future growth of the company, particularly if competitors start using better technologies.
- External Analysis
- Analysis of General Environment (Opportunities/Threats)
The company has an opportunity because it can try new products in the market. Also, PTFE is perceived as superior to plastic because it is flexible and able to withstand extreme conditions. The threat that the company faces is that of competition from companies like 3M and Worthington Industries. These two companies are more significant than Gore, and at some point, this limits the ability of the company to compete effectively in the market.
- Analysis of Industry Environment (Five Forces Model)
Threat of new entrants
The company faces the threat of new entrants in the market, and therefore the competition becomes high. With its diverse portfolio of products, many other companies come through making the same products that Gore has.
Bargaining power of suppliers
The bargaining power of the suppliers is high because of the many players in the industry, and this makes suppliers turn down offers quickly, and out for the ones they feel are better.
Bargaining power of buyers
Just like the suppliers, the buyers also have high bargaining power, and this makes them oft for the less expensive products. Therefore, Gore will also have to lower its prices.
Threat of substitute products
With the many products that the company makes, there is the threat of substitute products. Many companies join the industry and make many other products that the customers choose from, and they feel like they get the same satisfaction that they would have gained if they used the products from Gore.
The intensity of rivalry among competitors
The competition is too high, and this is what has led to the rivalry between the players in the industry.
- Analysis of Competitors
III. Strategic Options
The first strategic option is to know the competitor and understand some of the various aspects that competitors present. These aspects include understanding the objective of the competitor, their assumptions, strategies, and capabilities. When the rivalry is intense, there is always a strong need for the company to understand its competitors. The firm should find out what draws its competitors, what competitors do, what competitors believe concerning their industry and the capabilities of the competitors. The firm will be able to make a response profile for these questions concerning the competitor, as long as it has the answers.
- Intra-Option Analyses
- Option 1: Status Quo (No change in the current strategy)
- Pros (qualitative and quantitative)
The customers are already used to the products of the company, and the company will continue making its sales as usual.
- Cons (qualitative and quantitative)
Competitors may always try out new things, and they will attract customers who like trying out. Thus, the sales may go down if competitors attract customers from Wore.
- Option 2: Understanding the actions of the competitors and their response
- Pros
It contributes to the ability of the firm to perform successfully in the industry. The firm will relate well to its competitors. The firm will know the weakness of the competitor, and purpose to explore it by making it become an opportunity, where it can benefit.
- Cons
Most managers often fail to analyses their competitors as expected, and this makes them at a competitive disadvantage to their customers. When the competitors learn that they are being watched, they will change their strategy, and this will confuse the firm. At times it creates hostility between the firms.
- Option 3: Competitor intelligence
- Pros
It helps the firm to know the competitors’ strategies, objectives, capabilities, and assumptions. The firm gathers information concerning the competitor as well as global policies. Facilitates the understanding of the posture of the foreign competitors.
- Cons
What is ethical in a country differs from ethics in another country. The rules of engagement change in various contexts, and therefore, they are not standardized. Firms have to avoid the probability of ethical quandaries and legal entanglement when strict legal and ethical guidelines govern the gathering methods of their competitive intelligence. The restrictions do not give the company the ability to act freely.
- Inter-Option Analysis and Recommendation
Option 1: Status Quo (No change in current strategy): The first criterion is from the perspective of the company, where the company looks at its SWOT analysis and makes an informed judgment. (7)
The company should focus on its strengths and minimize its weaknesses. (8)
The significant participation of managers (8)
Total for option 1: 23
Option 2: Understanding the actions of the competitors and their Response: The second criteria is from the perspective of the competitors, who are the biggest threat to the company (5)
Considering the weakness of the competitors (5)
Looking at the response of the competitor (5)
Total for option 2: 15
Option 3: Competitor Intelligence: The third criteria is from the perspective of the restrictions that the company may face in its quest for competitor intelligence (4)
Probability of legal entanglement (8)
The company is not free to perform its operations (4)
Total for option 3: 18
The option with the highest rating is option 1.
- Implementation Plan – 5 points
The company should choose the option with the highest rating, which is option 1, and chose the next one, which is option 3. Option 2 should be the last one because it has the lowest score.
VII. Plan for Assessing the Performance of the Firm after Implementation
The assessment of the firm is done by considering all these options and giving the best option a try. It entails considering the strengths and the weaknesses of the company as well as looking at the weaknesses that competitors have to use as an opportunity.