What Is Danaher Corp’s Corporate Strategy? How Does It Create Value?
Essay by nitsgarg • October 10, 2018 • Case Study • 411 Words (2 Pages) • 1,252 Views
Essay Preview: What Is Danaher Corp’s Corporate Strategy? How Does It Create Value?
Q1. What is Danaher Corp’s corporate strategy? How does it create value?
Ans. Danaher Corporation is one of the best conglomerate in US, they have adopted different strategies to give itself competitive advantage:
Business level strategies- They mastered low cost and product differentiation in business level strategies. Their success mainly comes from “continuous improvement” called Danaher Business System (DBS). DBS approach embodied four P’s (People, plan, process and performance) with main emphasis on growth, lean and leadership. Danaher applies DBS in every acquisition very consistently for continuous productivity improvement, RnD, market activities, plant and machinery, supply chain and all operations.
Corporate level strategies- Danaher corporate level strategy was to obtain attractive, value added mergers and acquisitions in vertical market.
Danaher corp created value by giving consistently growth (20 years) and returns (25%) to its shareholders more than GE and Berkshire Hathaway. Danaher portfolio is of $13B (Exhibit 2) from different business they have acquired (Environment ($2.7B), T&M (2.8B), Dental ($1.8B), Life sciences and Diag ($2.3B), Industrial Technologies($3.2B)). Danaher made process improvement an art. Danaher’s revenue growth is largely driven by acquisitions.
Q2. What are Danaher’s key resources?
Ans. Danaher’s corp rigorously follows DBS, their key resources are four P (people, plan, process and performance) .
People: Danaher works in building senior management who can follows DBS in newly acquire firms or business.
Plan: DBA creates strategic plan for every business, Danaher executives do due diligence process and their plan covers what are the strategic changes they can do in new or existing business to win the market share.
Process: DBS process gets introduced to new acquired group or managers in week’s training. Goals are set higher. Building a managerial mind-set of continuous improvement is the most important result of DBS process.
...
...