I need a response to my classmate below
A game-changing move that you believe will create a sustainable competitive advantage.
Stanley Black & Decker has a long history of doing deals that combine competitors or combine adjacent market participants into a larger, more powerful contender in the spaces they compete. For this week, I’m going to recommend we buy one of our smaller, yet fierce competitors, Shearcore, for a couple of reasons. First, I would buy Shearcore to drive an economy-of-scale move in our core product offerings of hydraulic attachments in the demolition and scrap recycling as we both are competing for a slice of a relatively static sized pie (Week 6 Lecture). Second, I would acquire them because they have the exclusive North American distributorship of Oil Quick couplers. These are couplers that are quickly becoming a market staple and we have no skin in the game. In fact, we often ship OUR products over to our competitors to outfit them with these couplers for OUR customers. That is flat our crazy in my book! That gives our competitor an inroad our competitor could and is trying to take advantage of to get into our customer base. While the cost to convert over some of our customer fleets to the competition is pretty cost prohibitive, this is one area that will continue to grow and the more attachments our customers demand Oil Quick couplers with, the more chances our competitors have to disrupt that relationship and poach customers to their products exclusively.
How the move will fundamentally shift the playing field to the company’s advantage and beat the competition.
This would fundamentally shift the playing field because it would give us greater scale for manufacturing capabilities and would give us access to an up-and-coming technology (Oil Quick) that I believe will be a critical growth factor in our industry. Stanley Black & Decker (SBD) excels at marketing and advertising and that could be leveraged to really go after Genesis. I also think it would shift the playing field because Shearcore is trying (albeit slowly) to reimagine the customer experience by providing white glove treatment from a large, dedicated team of service professionals that help setup every new attachment delivered. We used to do that…until we disbanded that team because they ‘didn’t generate revenue’, according to one of our past leaders. Now, ironically, the leader of our old service team is the new leader of Shearcore’s service team and they have the support from their leadership team that in fact, they DO generate revenue with that type of service. I also really like the concept from this weeks’ article on busting industry bottlenecks and an old, outdated customer experience is one place we could really use a new approach. We introduced a digital solution (essentially telematics) a couple of years ago and have made little headway. I think taking their white glove efforts, combining our digital solution and putting the weight of SBD behind it to really redefine the customer experience across the board would be a solid play (Ersek, Keller and Mullins).
Explain which of the four positioning categories described by Sherman (Breakaway, Reverse Positioning, Blue Ocean or Disruptive Innovation) best describes the move, and why.
I think the best positioning category for this move would have to fall under Breakaway positioning. As I said above, our market needs some breaking of bottlenecks with one of them being the customer experience. We have a digital tool that can help our customers better understand their productivity by measuring the performance of their attachments in several key areas and we can/should leverage that. This solution is completely new to the game and if we can get our customer base to embrace this new technology it will completely disrupt how our product is thought of and purchased by our customer base.
Thanks,
Mike
Resources:
Week 6, Lecture Notes
Week 7, Lecture Notes
Ersek, Keller and Mullins (2015). Break Your Industry’s Bottlenecks, Harvard Business Review, July-August 2015 Edition.
Sherman,