Regal Marine, one of the U.S.’s 10 largest power-boat manufacturers, achieves its mission—providing luxury performanceboats to customers worldwide—using the strategy of differentiation. It differentiates its products through constant innovation,unique features, and high quality. Increasing sales at the Orlando,Florida, family-owned firm suggest that the strategy is working.As a quality boat manufacturer, Regal Marine starts withcontinuous innovation, as reflected in computer-aided design(CAD), high-quality molds, and close tolerances that are controlled through both defect charts and rigorous visual inspection.In-house quality is not enough, however. Because a product isonly as good as the parts put into it, Regal has established closeties with a large number of its suppliers to ensure both flexibility and perfect parts. With the help of these suppliers, Regal canprofitably produce a product line of 22 boats, ranging from the$14,000 19-foot boat to the $500,000 44-foot Commodore yacht.“We build boats,” says VP Tim Kuck, “but we’re really in the‘fun’ business. Our competition includes not only 300 other boat,canoe, and yacht manufacturers in our $17 billion industry, buthome theaters, the Internet, and all kinds of alternative familyentertainment.” Fortunately Regal has been paying down debtand increasing market share.Regal has also joined with scores of other independent boatmakers in the American Boat Builders Association. Througheconomies of scale in procurement, Regal is able to navigateagainst billion-dollar competitor Brunswick (makers of the SeaRay and Bayliner brands). The Global Company Profile featuring Regal Marine (which opens Chapter 5 ) provides further background on Regal and its strategy.Discussion Questions *1. State Regal Marine’s mission in your own words.2. Identify the strengths, weaknesses, opportunities, and threatsthat are relevant to the strategy of Regal Marine.3. How would you define Regal’s strategy?4. How would each of the 10 operations management decisionsapply to operations decision making at Regal Marine?
Regal Marine, one of the U.S.’s 10 largest power-boat manufacturers, achieves its mission—providing luxury performance
boats to customers worldwide—using the strategy of differentiation. It differentiates its products through constant innovation,
unique features, and high quality. Increasing sales at the Orlando,
Florida, family-owned firm suggest that the strategy is working.
As a quality boat manufacturer, Regal Marine starts with
continuous innovation, as reflected in computer-aided design
(CAD), high-quality molds, and close tolerances that are controlled through both defect charts and rigorous visual inspection.
In-house quality is not enough, however. Because a product is
only as good as the parts put into it, Regal has established close
ties with a large number of its suppliers to ensure both flexibility and perfect parts. With the help of these suppliers, Regal can
profitably produce a product line of 22 boats, ranging from the
$14,000 19-foot boat to the $500,000 44-foot Commodore yacht.
“We build boats,” says VP Tim Kuck, “but we’re really in the
‘fun’ business. Our competition includes not only 300 other boat,
canoe, and yacht manufacturers in our $17 billion industry, but
home theaters, the Internet, and all kinds of alternative family
entertainment.” Fortunately Regal has been paying down debt
and increasing market share.
Regal has also joined with scores of other independent boat
makers in the American Boat Builders Association. Through
economies of scale in procurement, Regal is able to navigate
against billion-dollar competitor Brunswick (makers of the Sea
Ray and Bayliner brands). The Global Company Profile featuring Regal Marine (which opens Chapter 5 ) provides further background on Regal and its strategy.
Discussion Questions *
1. State Regal Marine’s mission in your own words.
2. Identify the strengths, weaknesses, opportunities, and threats
that are relevant to the strategy of Regal Marine.
3. How would you define Regal’s strategy?
4. How would each of the 10 operations management decisions
apply to operations decision making at Regal Marine?
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