Sachin Chaudhary PGDM2/1528

CASE ANALYSIS

KOMATSU LTD.

Company : - Komatsu ltd.

Established : - 1921

Issue : - To increase the market share with new slogan

“GROWTH, GLOBAL, GROUPWIDE”

Goal : - Becoming World’s premier construction equipment

Manufacturer

OBJECTIVE : - To catch up and with surpass caterpillar (CAT)

Challenge : - Catching & surpassing caterpillar (cat)

HISTORY

Established : - 1921

- As specialized producer of mining equipment

- During 1930’s expanded into agricultural machinery

- During II world war, produced military equipment.

Market share : - 50%

Sales : - $168 million

KAWAI ERA (1964-1982)

State of industry : - Company was prepared on TQC (total quality control) program.

Strategy : - Acquire and develop advanced technology, to raise quality, and to

increase efficiency to the level necessary to “catch up with and surpass Cat.”

Management : - Ryoichi Kawai

Introduced :-

• Management by policy- 1st policy -> Project A- Raising quality

• New system of control- Plan , do , check ,act (PDCA) cycle.

Result : - Project A was successful, increase in sales & market share from 50% to

65%, Komatsu emerged as the major challenger in construction equipment industry.

THE NOGAWA ERA (1982-1987)

State of industry : - Fall in demand, appreciation

Strategy :- Cost cutting & aggressive sales tactics instead of shifting

production overseas.

Management : - Shoji Nogawa

• Autocratic style of leadership or management

Result : - established plant in world’s major markets- tennesse ; UK,

Expanding product line.

TANAKA ERA (1987-1989)

State of industry : - declining state , Challenging economics crisis

Strategy : - Not to reduce cost but to bring down the production

product diversification.

Management : - Masao Tanaka

• Ended the practice of price discounting & high pressure sale,

• Laid groundwork for more rational, fair & orderly competition in the

domestic market

Result : - pursued internationalization.

market share fell from 35% to 31%, overall profits rose.

KATADA ERA (entering the 1990’s)

State of industry : - Stagnant sales, less demand of sales equipment

Strategy : - free discussion

New culture -3G’s (growth, global, group wide)

TQC is not center operating in creating and innovating way.

Project G- grow construction equipment construction

Growth segments – electronic, robotics and plastics

Management : - Tetsuya katada

Introduced new slogan

Result : - Abolish top-down management approach

: - sales increase