Bombardier Case Hbs

Bombardier

Bombardier’s key strategic advantage is its established reputation of quality, reliability and customer service which has been built painfully over the last 20 years. Its strategy relies on maintaining control of the design and the manufacturing of the shell - the core activities of the production pipeline. TEG outsourced about 60% of its non-critical activities but still places high priority on keeping control of the engineering and integration of the system, critical to controlling the quality, cost, and delivery time. This close control enables it to respond effectively to changes in customer demand but still provide on-time delivery.

The key disadvantages for Bombardier will be the fact that it does not have a significant manufacturing presence in the US. In addition, the company has been losing ground to competitors who have been spending a lot more on marketing and not relying on just quality and reliability of their service.

Morrison Knudsen

Morrison Knudsen’s key strategic advantage is its long history of operating in allied sectors that helped it to enter the rail car industry. The company has become excellent at project management and is good at winning contracts and outsourcing a significant portion of the work to third party contractors.

Since the design and manufacturing are outsourced MK has ceded some control over product quality and delivery control.

Strategy -

Morrison Knudsen has been rebuilding used locomotives and rail cars since 1982. The railroad division of the company specialized in building and electrifying railroad track and maintaining railroad yards and terminals. This strong presence in railroads gave the company marketing and political clout. In any contract that the company bid for, its strategy was the encircle the client with contacts from several divisions.

By operating in all parts of the value chain, it gave the authorities (customers) a one stop shop. In addition, it entered the industry aggressively to demonstrate its intent and aggressively bid for high profile contracts and those which the company believed would be influenced by political clout. The company then uses the fact that it manufactures/assembles locally to further influence its bids.

Bombardier’s response

Bombardier has a strong reputation