Operational Strategies for BMW and Ferrari to Gain Market Share from Mercedes-Benz

This document discusses the operational strategies that BMW and Ferrari can implement to gain a higher market share from Mercedes-Benz. It explores the concept of market penetration, product development, and diversification strategies. The document also provides an introduction to BMW and Ferrari and their presence in the global automobile market.

UGB165
INTRODUCTION TO
BUSINESS
OPERATIONS AND
SERVICES
Table of Contents

Introduction.................................................................................................................................................3
Companywide operations improvement strategy...................................................................................3
Introduction of BMW..............................................................................................................................7
Introduction of Ferrari.............................................................................................................................8
Operational strategies to gain higher market share..................................................................................8
CONCLUSION.........................................................................................................................................10
REFRENCES............................................................................................................................................11

Introduction
Business operations and services refer to such type of activities which includes business
engagement on the daily basis to increase the value of an enterprise and profit maximization. In
generation of the sufficient revenues, the activities can be optimize for the cover several
expenses and earning of a profit for the owners of the businesses. Employees can help in
accomplishing the goals in businesses by performing several functions including finance,
marketing, manufacturing and many others. A business operation refers to the growth of the
business and the organizational management should plan on the basis of changes that are prevent
occurring in the system. One of the most sorted examples is handling several challenges on the
basis of marketing, legal procedures, errors and omissions (Bashir and Verma, 2019).
The discussion includes questions based on the case study. The case study is on the basis
of improvement the strategic behavior and operations in Mercedes Benz so that it will reflected
out to be one of the competitive rivalry and maximize profit for the proper and effective growth.
The discussion includes explanation of how to introduce a companywide operations
improvement strategy. The improvement strategy includes several tools and the techniques that
helps in learning of the module. In addition to this, the discussion also includes advise on the
operational strategies in which Audi and BMW can implement to gain an effective market share
from the Mercedes-Benz.
Companywide operations improvement strategy
There is a need to always understand about different ways and acceptance that gives an outlook
and ways of improving practices so that company achieve maximum profit. It can be suggested
that automotive industry has reflected and seems out to be a great rivalry between most of the
large company sector or an organisation. One of the effective and most sorted example is
Mercedez-Benz, Toyota, BMW and many others. The possibility which have been based on
several structure are required the process of improvement and using the specific management
tools to achieve maximum satisfaction and benefits (Blagojević and et. al., 2019).
In addition to this, it can be also suggested that the process of improvement reflects
productivity and profit. There are various and several methods which are useful in developing
the opportunities in improving the business as well as competition. A streamlining of the work
refers to the work and reduction of the continuous improving strategy and effectiveness.
Continuous improvement business strategy

The continuous improvement of the strategy related with the business or an organisation are
specifically known as the continuous improvement process. The business strategy is one of the
on-going processes in improving of the services, processes and products in an organisation. Such
type of improvements sought can be possibly incremental or achieved with the process of break-
through. The processes delivery is significantly reflected out to be the delivery process which is
constantly made on the basis of improvements and the development which have been applied.
The measures are seems out to be the effective changes in the process including efficiency,
flexibility and many (Buckle and Thompson, 2020)
The continuous improvement process is seems out to be the meta process which indicates
that there is a need to figure out the larger part of the organizational goals. A bigger definition
considered being a gradual and simply a process which can never ended and this type of process
has been trying to increase the effectiveness and the efficiency to fulfil the effective goals and
objectives.
What Is Kaizen?
The Kaizen process simply useful for the continuous improvement. The Kaizen is systematically
came from the two Japanese work Kai and Zen. The work Kai means change and the word Zen
means good. It states a change for good. This is one of the methods which is useful in
understanding the competition success. The three points of the Kaizen includes
 Feedback: It is a core process that can be simply given by the self-reflection and if
consumers significantly give their feedbacks so that it will be effective for the
organisation to understand it and way fragile he process.
 Efficiency: The reduction, elimination and the identification ways of process.
 Evolution: Kaizen depends on the continuous development rather than leap forward.
The key features of Kaizen
Imai has been greatly identified the key feature of Kaizen. It includes improvements that have
been based on building of the small changes which are quiet opposed the major changes as well.
Also, the changes have been systematically utilize from the bottom and rising till the top, the
workers and the ideas are more aligned in terms of objectives of the organization and it can be
simply and effectively implemented. Furthermore, Imai have been also suggested that company

is systematically believed in consultant and supplier process to raise the inner growth and the
development. Consequently, the employees have been always being looking for the systematic
and effective process of the improvement process. He also suggested that workers take some
effective ownership of efforts and improve the ability on the basis of some realistic ideas in
improving the overall businesses. Also, on the basis of strategically improvement, there is a need
to have an effective delivery for all the consumers and waiting with the flexibility that helps the
consumers to achieve the goals and the profit (Wiengarten and Fynes, 2019)
The Principles of Continuous Improvement Business Strategy
Incremental Change: It refers to the no change and invention. The continuous improvement
business strategy effectively refers to the slow and steady growth but if systematically helps in
having an effective external forces rather than internal focus.
Employees Provide Ideas: Apart from the management, the change and the ideas should come
from the employees who are working in the organisations and problems must be experienced on
the basis of several and systematic knowledge in resolving them.
Incremental Change Is Cheap: The small changes are significantly not as costly but there is no
impact in the budget.
Workers Take Ownership and Accountability: The employees and ownership is a huge
process in which there have been more motivation and the investment.
Improvement Is Reflective: The continuous improvement can be reflective and suggest out to
be the major and effective dialogue, communication and consumers feedbacks which helps in
modifying of the strategy of continuous improvement
Improvements Can Be Measured and Repeated: Once a change is made, it’s not left alone but
monitored and measured, so determinations can be made as to its effectiveness. Therefore, if that
change does work, it can be repeated or applied to other aspects of the organization.
The continuous improvement in the business strategy.
There is a specific and the most significant need in improving the continuous strategic behaviour.
But it’s never good to take a concept on its word. It is very important to have a streamline
workflows. The constant look in improving several ways and the reduction in operation helps in
saving of the money and precious time. The reduction in the cost of projects and the overages.
The constant reduction in the projects and prevention of overages is very important and the

evaluation process have been systematically increases a greater knowledge of the overall costs
and sharpen the focus as well. The determination of project constraints have been systematically
helps in better shaping the organisation. Then there’s the flexibility inherent in the strategy. If
you’re always on the lookout for ways to improve, you’re flexible. This constant movement, if
it’s tethered to a well-thought out process, will reduce complacency and threats from the
competition (Jeevan, Chen and Cahoon, 2019)
The saving of cost and time helps in keeping the product quality and then a continuous
improvement strategy of business. It seems out to be a good and effective way in improving the
business and management of the balancing act. The opportunities of improvement in the
businesses give a measure and a valuable fact in improving of the businesses and evaluation of
an effective strategy that is being formed.
The organisations have been set up for the effective practicing of the continuous improvement
and the advantages have been based on one of the useful strategy. Some organizations are not set
up to have their teams’ constantly practicing continuous improvement, but that doesn’t mean that
they can’t take advantage of this useful strategy. An example suggests that companies have to
schedule the meetings and the process of improvement. For example, companies can schedule
regular meetings to discuss ways to improve processes. The adoption of such techniques at every
level from basic to high, the continuous improvement reflects a tool box which gives an
opportunity to reduce the inefficiency and cut of the waste.
Tools and techniques of the improvement strategy which helps in increasing the production
and maximisation of the products
Process re-engineering: Business process reengineering helps in re-formatting the technical
functionality of an organisation as well as improvising in achieving profit.
Introduce consumers: Management teams are often fond of saying about the companies. If
company show there products in the target market then the things can be effectively taken place
in a most appropriate and sort of ways.
Improve forecasting: Selling of the services and the products, management and the purchasing
inventory, controlling of an enormous supply chain, a good and a proper staffing are all based on
the forecasting improvement (Pasaribu, Vanclay and Zhao, 2020)

Focus on the quality as well: It can be suggested that multiple versions of the quality
improvement must be possibly taken into the consideration so that there is a greater need to have
a functional ability. The total quality management movement helps in reuse of the waste and
recycle all the material so that there will be a positive impact on the environment.
Inventory and material management: Inventory management is one of the process of stock
control process that involves the portion of the present accessible. Essentially, it is handling of
the inventory suggest that the stock control process is quiet feasible and accessible at the same
time. Any commercial enterprise, which includes inventory management procedures require
essential products which are quiet commercial and success. The inventory control does not even
simply establishing the items. There is a need to sell products and taken into the consideration as
well.
Supply chain management: The supply chain management system is refer to the flow of
services and products from a business that is being managed and the gain form the services and
products Supply chain management is the way the flow of services or products from a business is
managed to gain final products from starting materials. It is used to manage the supply and
demand network of the organization and to maximize the profits for a company and the customer
value.
Supply chain control in no longer best a procedure served to generate a price bargain inside the
finances or an undertaking to create larger operational efficiencies within an employer. While
these are part of the whole ecosystem, current-day deliver exchange control encompasses the
strategic alignment of stop-to-quit enterprise methods to realize market and financial value, as
well as giving an affiliation to the aggressive advantage over their industrial corporation rivals.
In recent times, the sunrise of the virtual age has added wholesale transformation to the sector of
commerce (Queiroz and et. al., 2020)
Suggestions for the operational strategies that can be used by BMW and Ferrari to gain market share
from Mercedes-Benz
Introduction of BMW
BMW is a prominent automobile company that was initiated by Camillo Castiglioni
Franz Josef Popp and Karl Rapp in the year of 1961 and has headquartered in Munich, Germany.
It deals in automobile across the globe in different countries. It provides a range of motorbikes,

appliances cars worldwide (Annarelli, Battistella and Nonino, 2016). BMW is perceived as a
luxurious brand by customers. It has ample of subsidiaries and presence over in various nations
globally. Company is operating with nearly 3000 local retailers who make available its products
to end users. It is analyzed that although, it is known for cars but also provides two wheelers to
global audience. Organization is operating at large level with huge funds and efficient marketing
practices. In addition, it is targeting majorly to the premium segment who seek for status and
ready to pay extra amount to maintain their image within social group. Further, entity is also
functioning its own financial unit in order to provide loan facilities to customers. Moreover, it is
a renowned company that is operating at large level with higher number of resources at global
level.
Introduction of Ferrari
Ferrari is also one of the well know brand that is operating business at large level in
various countries at international level. Company was founded in the year of 1939 by Alfa
Romeo and it launched first car in 1940. It has headquarters in Amsterdam, Netherlands, in Italy.
It is producing sports cars to with highly proficient and speedy engines. It is multinational brand
that provides is engaged in production, designing and sales of highly efficient cars and ensures
to make it available in different countries.
Operational strategies to gain higher market share
There are several strategies which are being used by organizations in order to improve
enlarge their business functions and enhance operational efficiency (De Florio, 2016). It is
monitored that as per current assessment Mercedes Benz is not performing remarkable at market
place that is affecting its brand value negatively. Thus managers are required to prepare
appropriate strategies in order to improve its position in market and maintain good sales & profit
margin. For this, they can undertake Ansoff matrix to carries out several strategies for future
growth and success of entity. Here, these strategies are used by managers to achieve predefined
goals and objectives in best possible way and to enlarge business operations in market. Here four
important frameworks are included in this matrix such as Market penetration and development,
Product development and diversification. It can be implemented by respective entity to attain
desired objectives. These strategies are given as under:

Market penetration: Here, organizations work with existing products in existing market
place. No new products and services are introduced by entities rather they prepare appropriate
strategies and undertake experiments with existing pricing strategies (Ike, 2017). Managers
provide higher discounts in order to attract to more number of buyers and receive competitive
edge. In this regards, managers of respective organization use innovative and new methods to
increase in sales and profit margin. These strategies are helpful to attract new buyers and retain
existing ones.
Market Development: In this, company introduce existing product in new market
segment. In case of Mercedes Benz, it can expand market share in those countries in which
company was not operating earlier. For this, managers need to execute proper market research
so that they can target right audience. It will be an efficient strategy that will enhance overall
sales and profitability of entity.
Product Development: It refers to launch new products and services among existing
audience. Here people already have trust over brand thus it is quiet easy to sale out new products
and services. But it is also comprises a lot of risk as it may hamper existing image of brand at
market place thus managers need to be careful while using this strategy (Fernando, Jabbour and
Wah, 2019). In context of Mercedes-Benz, it can bring more innovative and unique products
such as self driven cars to provide ease to customers. It will give exponential hike to sales of
company and provide it an edge over other rivalries. Due to this, managers of entity undertake
appropriate research in order to know current market trend, preference of customers to provide
products accordingly.
Diversification: To come up with new products and services in entirely new market
segment is termed as diversification. In this, neither neither exiting product nor customers
segment are used by company. They targeted a new group of customers with more innovative
and advanced products and services. There are several risk factors associate with this strategy as
it requires huge investment and marker research. It may change existing image of brand at
market place. So, managers are required to evaluate ample of variables while diversify business.
It provides great opportunities to managers to enlarge business functions. In case of Mercedes-
Benz, it can diversify business by introducing new and innovative products to new set of
customers in different countries. For this, managers need to evaluate several factors associate

with diversification such as investment, customer’s attitude, current trend in order to attain
predefined goals (De Boer and Andersen, 2019).
Most suitable strategy for selected entity is product development as in this it will get
benefit of its current brand image. In addition, it will also provide competitive advantage to
company and helps it to operate effectively.
CONCLUSION
Above discussion states that there are several functions that are crucial to perform by an entity in
an appropriate way to ensure long term survival. In case of Mercedes-Benz, it is facing huge
problem of Compton and inability to manage operations effectively that is decreasing its
performance as well as productivity. Discussion has been carried out related to strategies that can
be used by company in order to expand business and deal with failures of business effectively. It
will help entity to face competition and sustain at market place for longer run (Fahlevi and et. al.,
2019)
.

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