Z01_JOHN2020_09_SE_EM20.QXD 10/13/10 9:10 Page 669 CASE STUDY Sustaining the magic at Bang & Olufsen Thomas Gulløv Longhi and Frank Brandt Kristensen In the past, Bang & Olufsen (B&O) has managed to adapt to changing market conditions mainly by launching new products with the best available technology and a unique design. In 2007, B&O faced a dramatic downturn due to the global financial crisis and at the same time experienced a paradigm shift in the market with the main drivers based on digital and networked technology. New management, installed in 2008, changed the structure and introduced a new strategic plan, improving efficiency and enhanced product development whilst retaining the focus on B&O’s core
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© Thomas Gulløv Longhi and Frank Brandt Kristensen 2010. Not to be reproduced or quoted without permission. Z01_JOHN2020_09_SE_EM20.QXD 670 10/13/10 9:10 Page 670 SUSTAINING THE MAGIC AT BANG & OLUFSEN international focus. Shortly after Kalle Hvidt Nielsen was appointed new CEO for B&O, the company announced a new turnaround strategy with a focus on proﬁtability and centred on the product range. This new strategy, named ‘Pole Position’, is a metaphor chosen from Formula One motor racing. By using the term ‘Pole Position’, the new strategy is meant to signal a clear goal, a sense of urgency, teamwork and clear tasks for each team member of the organisation. The vision for B&O is to develop exclusive audio and video products differentiating on design, quality, innovation and user friendliness, for which the following initiatives have been taken: 1 Focus on product development in fewer product categories. Primarily audio and video products. 2 Focus on one technological digital platform for each category. Enabling the company to reduce the time and cost for new product launches. 3 Focus on one global sales organisation to support the 800 authorised concept stores worldwide and the 400 Shop-in-Shops. 4 Adjust the cost structure in accordance with market conditions. Changes in product development At B&O, the main products have always been audio and video products. According to the new strategy, related product categories such
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