The purpose of this report is to execute a proper appraisal of Ebrahim Khalil Kanoo Group and evaluate the implications for the strategy of the company. To conduct these examination two main phases will be studied into consideration. First of all the external environment of the business that will concentrate on its wider environment by applying a PESTEL framework and Porter's five causes that will lead on to identify key opportunities and threats facing the company. Secondly the inner resource capability analysis that will concentrate on the firms Recourse Audit and its own value chain followed by a linkage of its Central Competency through the use of the VRIN analysis, that will lead to a sign of the main element advantages and weaknesses of E. K. Kanoo Group.
For over a century, the Kanoo family has been one of Bahrain's leading product owner dynasties. With business links spanning the Arab world and South Asia from the days of antiquity - even prior to the invention of the electric motor car the Kanoo name has for decades been a byword for trust, service, and stability.
In 1920, there have been only two autos on the island of Bahrain, both had by the Ruling family.
Therefore in 1952 Ebrahim needed the chance to set up himself as a leading importer of cars and spare parts under the name Green Automobile Stores, securing in 1966 the only real authorized distributorship in Bahrain of Toyota automobiles, professional vehicles and related services. The Toyota Electric motor Corporation was founded in 1937 by Kiichiro Toyoda. The first vehicle, the Toyota AA, was stated in 1936 whilst the business was still associated with Toyoda. The brand as we realize it became established as an independent company in 1937 and modified their name to Toyota. They opened up their first manufacturing plant in 1938 but it had to be cease creation during World Warfare II.
In 1974, Ebrahim's sons, Mohamed and Fuad, assumed responsibility for the day-to-day procedures and strategic direction of the business enterprise, steering it into a fresh era. They produced the E. K. Kanoo Group of Companies. Target was initially exclusively on the Toyota franchise, which led to the establishment of 1 of the most superior and successful motor vehicle businesses in your community.
In 1989 Toyota launched their new luxury product line Lexus and in 1990 the company was wanted to become the only distributorship of Lexus automobiles.
Toyota happens to be one of the greatest corporations growing hybrid vehicles for the commercial market.
Today, with more than 50 years of determination to service excellence, E. K. Kanoo is universally acknowledged as one of the island's motor vehicle pioneers of Toyota and lexus, producing and exceeding anticipations in the motor vehicle business.
The next era of the Kanoo family are now fully mixed up in business and are building their jobs, and expanding the business, in the founder's footsteps.
Further diversification enlargement had taken the group into other business areas, building new companies with the same commitment to trust, dedication and dependability such as Kanoo IT, security 1, Kanoo Electric power solution.
Kanoo IT in 1999
In 1999 Kanoo IT was launched as a department of Ebrahim K. Kanoo B. S. C. (c) which discounts in A committed action to first-rate ICT product and service support that is mirrored in its partnership with the leading hardware and software brands across the world.
The changing face of the ICT industry drives Kanoo IT's technique to provide industry leading products and services to its clientele in Bahrain. The company has geared itself to meet this challenge by offering an ground breaking range of products and allied services and being very sensitive to the complete needs of today's customer
Security 1 in 2006
In 2006 Security One was launched as a division of Ebrahim K. Kanoo B. S. C. (c). Which discounts in a division of the Ebrahim K Kanoo Band of Companies that stands on producing and providing specific alternatives in the areas of Security, Fire, Safe practices and Automation requirements for those Governmental, Commercial, Residential and Industrial jobs.
In participation with the most important and established international product manufacturers in Security business, it has generated a strong Competence Centre in Bahrain with an professional experienced team of consultants and authorized engineers, targeted at providing the most progressive and affordable solutions, coupled with excellent customer support and after sales service.
They develop, deliver and support the most mission-critical applications to meet up with the most stringent customer support requirements
Kanoo Vitality solution in 2006
In 2006 the Kanoo Vitality Solutions premiered as a department of Ebrahim K. Kanoo B. S. C. (c) which deals in vitality products for commercial applications. It's the Authorised Distributor in the Kingdom of Bahrain for Exide Technology and Chloride UPS Systems who are pioneers in their respective fields.
Exide battery power have a design life ranging from 5 to 20 years and can be purchased in both AGM and Gel technology. Exide Systems is a worldwide innovator in stored electricity solutions for those major critical reserve standby electric power applications and needs. Standby electric power applications include communication/data sites, UPS systems for personal computers and control systems, electrical energy generation and circulation systems, as well as a variety of other industrial standby electricity applications.
Toyota & Lexus PESTEL Analysis
The first stage of the external environment examination is through the PESTEL platform that helps E. K. Kanoo professionals understand the picture as a whole of the political, economical, social, technological, environmental and legalities that they are operating within. (reference point)
Based on our research it has been recognised that they talk about the same research as the mother company in Japan but are different in some areas. (To be added)
Political factors: effect on many vital areas like the environment of the labor force, the humans' health insurance and the quality of technology such as hybrid system.
Based on our research, Toyota have positive politics impact. By producing the environmental friendly cars designed to use less fuel and reduce dependency on petrol, Therefore, the country itself reduce the dependence of the petrol. On the other hand EKKanoo and its customers reap the benefits of this matter as prices of full are much lower than Japan and the US.
The dependence of the gas and oil from the international source will immediately and indirectly have an impact on one country overall economy growth as well as the national security.
Growth in the infrastructure development sector following a announcement of Qatar web host the 2022 world glass and Qatar Bahrain causeway will revise the current economic climate. (Economical factor)
The cultural unrest is constantly on the weigh greatly on the country's politics stability. Folks are not in a position to comfortably invest in expensive products.
Economical factors: This includes interest rates, taxation charges such as the road taxes, insurance tax, economical progress, inflation and tax incentive. Quite simply, the costs have to pay more for car users.
Economy is also another impact to virtually all countries about the world. The consumers begin to choose the hybrid car based on the advantages of fuel savings as time passes which means the "repaid".
There have been a slight decline in sales of non-luxury motor vehicle brands due to the politics unrest and economical slowdown (2009-2011), but the figures this season reflect a positive view and the growing sales quantities will carry frontward in 2013. Market share for Toyota has increased over 2011 which was lost due to scarcity of stock and end of pattern models.
High projected olive oil prices in 2013-17 will contribute to financial surpluses. Neighbouring GCC ventures will increase credited to huge petrodollar surpluses.
Major tasks have been declared to commence and be completed by 2013 & 2014. These projects are home as well as industrial; with the potential of increased inhabitants and commercial activities that could make higher sales of vehicles and equipment.
Appreciation of Yen money does not assist in maintaining competitive prices.
Social factors: This factor requires into consideration all situations that affect the marketplace and community socially. Thus, the advantages and drawbacks to the folks of the area in which the project is taking place also need to be looked at. These events include cultural expectations, norms, human population dynamics, healthy awareness, career altitudes and global warming.
Due to the local climate change turn into a serious matter nowadays, Therefore EKK is importing vehicles from Toyota which modify with GCC criteria and environment also Toyota should produce a vehicle which you won't bring pollution to the surroundings.
Very low dependence on public transportation system in Bahrain, therefore people choose to own vehicles.
Technology factors: New solutions create services and new functions. Technology can reduce costs, improve quality and lead to technology. These developments may benefit consumers as well as the organizations providing the products.
Toyota plaza is one of the greatest service centres device on the globe for Toyota and Lexus.
Enterprise Recourses Planning (ERP) which have the latest version of oracle system.
Legal factors: Organizations also need to adapt their products and ways of operating to the various regulatory and legislative platform that govern each one of the products areas and countries in which they are productive. Other than that, the programs also need to take into consideration. Organizations have to follow all the rules and regulations which can be place by the governance even if there is new technology engagement,
Electrical cars from Toyota which the company cannot import anticipated to country economic growth issues.
Changes of country importing rules and regulations can affect.
Number of cars allowed into the country and garden auto parking cost.
Environmental factors: are the weather and climate change. With major local climate changes occurring credited to global warming and with increased environmental understanding this external factor is now a significant issue for firms to consider. In Bahrain one of the GCC countries that have hot local climate over the entire year. (to be modified).
E. K. K have agreed upon contracts with recycling companies to recycle all after service materials such as olive oil, tiers, spark plugs and presentation boxes.
All imported automobiles are installed with an friendly environment exhaust system that reduces the quantity of polluting of the environment.
Porter's 5 forces
As for taking into consideration the competitive issues the company encounters Porter's five causes helps identify the attractiveness of the industry it works in and helps it understand the effectiveness of the current competitive position. (research)
Power of suppliers
The bargaining electric power of suppliers is low. There are many types of suppliers in the vehicles industry, like the cooling system, electro-mechanical system, braking system and gasoline supply system allocated throughout the world. EKKanoo became the sole distributor of parts and extended their car warrantee to 4 years/150, 000 KM with a 3 time free service program and built a good network of service and parts centres throughout the spot.
However, most vehicle makes own many interchangeable suppliers, and also have the capability to produce the components by their own in the small amount of time. Thus, the suppliers do not own the power to change the purchase price.
Power of buyers
The Bargaining electricity of buyers is high. Bahrain market is still price motivated for almost all of the customers segments. Today, clients have a lot of information route, such as the internet, where may easily find the proper vehicle. And, the choices of the private individuals are important to the vehicle corporations. If vehicle Company enhances one type, they can also choose other type or the cheaper one. Customers look to get more detailed discount rates, free service packs and better financial schemes or they can certainly find the substitutes. Such as for example used automobiles, trade in or exporting from other countries.
Threat of new entrants
The entrants cannot enter in to the motor vehicle industry easily, as automobiles are special products that want a large sum of money on the look, monopolize the market, electronic digital functions, and safe practices issues. And another important concern is the brand loyalty in the automobile market. Vehicle companies always advantage the brand value, and reduce the consumer level of sensitivity about the purchase price.
As EKKanoo has been the first automotive industry on the island and Toyota stands for Quality, Safety, Resilience and Stability; a standard in the automotive world customers have a strong perception in the brand and feel that Toyota is the most dependable brand in the motor vehicle market and feel that it has become more complex technologically with sophisticated interior which echo unrivalled beauty and exclusiveness.
Therefore Toyota stands out as a high value brand and Low priced of ownership is from the brand.
Rivalry among competitors
The competition in the vehicle industry is strong. The top eight vehicle companies have occupy large part of global earnings, and these auto manufacturers strengthened the globalization and loan consolidation across the worldwide range.
Korean brands are proving to be a potential hazard with the release of attractive design and features at competitive prices. This reflects their upsurge in market share over time.
Competition among japan brands is intense, American brands will take edge from the loved Japanese Yen and Chinese language brands have started to show their presence on the market.
With new models being launched in 2013 for the Toyota line up, Toyota would be able to dominate the marketplace and emerge as the main brand. Toyota will face extreme competition from Nissan, Hyundai and Kia in the traveler segment, fresh and sporty brands will have significantly more opportunity.
Nissan poses to be the major danger for Toyota in Bahrain as they have got an aggressive pricing strategy which is supporting those to dominate the marketplace. This is reflected in the increase of market share of Nissan over time. Korean products have a far more younger looking and sporty design with added technological features at a competitive price.
The main competition of Luxes in Bahrain are BMW, Mercedes, Audi and Infiniti.
5. Risk of substitutes
The threat of the substitutes is high. There are a great number of substitutes in the automobile industry. When the price tag on the vehicles goes up, the substitutes will emerge, there are many types of equipment that can take the place of vehicles, such bus, subway, bicycle and even walking. In Bahrain it is Low due to hot clement it is hard for people to walk and journey bikes, low community transportation services as it's a small island.
Internal Environment Analysis
The next level is to handle an research of E. K. Kanoos interior resource capability through the use of the Threshold and Difference capability platform that will maintain a briefing of the resources available to the company and exactly how they help them achieve competitive gain and superior performance.
Based on the evaluation of E. K. Kanoo business field its Threshold Resources will be the need of capital, showrooms, service garages, safe-keeping, logistics, land transport, customers, suppliers, specialized equipment, shop and car port equipment and staff personal to attain its competitive benefit and superior performance within the market.
Marketing - E. K. Kanoo has a higher strategy of technology which means need of marketing is highly recommended to launch its new cars, spare parts and accessories, for example controlling the start of 2013 models.
IT systems - Updated systems and IT experts are necessary for the performing of the business enterprise as without these, the organisation would not do well as they may have innovated the organisation with the Oracle system which will be explained farther along in the survey.
Distribution - E. K. Kanoo has managed to lower the expense of circulation which is also a essential part of its business by featuring its storage places next to the automobile market and within its service centres.
Competitor research - Having an insight on what competition are doing helps E. K. Kanoo achieve constant marketing innovation to continue making improvement over its competition. . . . . . . ?
Customer relationships - One of E. K. Kanoo distinctive features is its "Online and mobile Personalised Service" that is established by the client relations management division that is computerized System for Identifying, Targeting, Acquiring, and Retaining the Customers, helps in Profiling, Understanding Their Needs, and in Building Associations With Them By Providing the best option Products and Enhanced CUSTOMER SUPPORT and also Combines Back and Front side Office Systems to make a Repository of Customer Connections, Purchases, and Technical Support, Among OTHER ACTIVITIES. This Database Helps THE BUSINESS in Delivering a Unified Face to Its Customers, and ENHANCE THE Quality of the partnership.
Recently they may have introduced the client online service visit reservation system that will. . . ?
Allowing customers to provide immediate feedback and tips to them to increase company technology and customer satisfaction?
Location - E. K. Kanoo has expanded from functioning in the capital only to functioning all around the Kingdom of Bahrain.
Recruitment - Personnel are recruited predicated on the business's needs and is also also task focused, targeting experienced people with high talent and thus target staff working for well known companies such as. . . . . . ?
Price -. . . . . . . . . . . . ?
Scale of business - Moving from offering random automobiles and then covering all customer needs from all sorts of Toyota and Luxes automobiles, offering service plans, extra parts and accessories plus invention by presenting. . . . . . . . . . ?
Brand image -. . . . . . . . . . . . . . . ?
Supplier benefit - Amazons capability to source another range of suppliers. Starting with Ingram catalogs, the largest e book distributor in america, prior to going live online. After which Amazon built many different types of vendors, from the seller customers to book publishers. Building romantic relationships with popular manufactures and brands on the way easing the launch of Kindle.
Three pillar strategy - Selection; by offering a wide selection of both luxury and passenger automobiles, Price; committing to price leadership without sacrifice to quality by offering free delivery and promptly delivery, Convenience; by dedicating many resources and building a customer connection management team to comprehend its customers' needs and needs.
Technology - E. K. K increased its technology by starting the web service visit and rent an automobile option on its website.
Value Chain Analysis:
Analysing the value chain can help describe the types of activities within E. K. Kanoo which along creates its' retail service.
Firm Infrastructure: E. K. Kanoo corporate and business headquarter is situated in Manama the capital of the Kingdom and its showroom is put in the center of the automotive designated region, as E. K. Kanoo is a sales and after sales business they built a good network of service and parts centres throughout the spot and broadened the service branches around the main locations of Bahrain to reduce customer traffic and frustrating.
Human Source Management: Employees are an expensive and vital source of information. EKKanoo manage recruitment and selection, training and development, rewards and remuneration. They consider their workers as Man CAPITAL which is mostly focused on the technical side as the select technicians based on specific sanders that enhance them to be dispatched for a 2 yrs secondment to the mom company in Japan to improve their expertise management and put into practice it within the organisation. They also follow the team 21 technical training scheme the development of this new team curriculum was essential to keep carnet with changes in the automotive industry also to take benefit of advanced training technology to better serve customers satisfaction, reaching high efficiency and quality work process in each service shop, is the key global of restructuring service training.
The objective and objectives of the company is the generating force behind the HRM strategy.
Technology Development: Technology is an important way to obtain competitive advantage. Companies need to innovate to lessen costs and also to protect and preserve competitive gain. Therefore EKKanoo carried out its own Business Learning resource Planning team that installed the Oracle system to the business by liking it from its head office to all or any branches and division all threw the kingdom that may be modified based on the departments requirements as pear enhancement report that shows departments needs aims of their requests besides to advantages and how it'll impact the business, billet one of the most significant & most advanced Toyota and Lexus service centers on earth called the Toyota plaza that is installed with the most advanced technology equipment that guarantees health and safe practices to both the environment and personnel, rises service quality, prepared with the latest incidents repair and framework alignment solutions, the most advanced painting systems and quality control techniques are used in the Toyota Plaza. Kaizen continual development that calculates the utilization performance of all tech support team that are involved in the technological work field.
Customer Marriage Management (CRM) ( ? ), and a great many other technological developments.
Procurement: This function is responsible for all purchasing of goods, services and materials. The aspires to secure the lowest possible price for buys of the highest possible quality. Toyota motors will be responsible for outsourcing (components or functions that would normally be done in-house are done by other organizations), and e-Purchasing (using ITand web-based solutions to accomplish procurement seeks).
Inbound Logistics: E. K. Kanoo invests in Research and Development to enable these to find new ways to improve their customer activities and, taking into account customer feedback to comprehend their wants and needs before buying any new vehicles.
Operations: Procedures include managing and ordering the parts and accessories for new automobiles, and the final tune for a new car's engine. E. K. Kanoo are recognized for their dependability which originates from efficient functions. Therefore they always take into consideration the number of sales personnel and technicians that must be trained to achieve organization and client satisfaction during the sales and after sales process.
Outbound Logistics: The products are now done, and they have to be sent across the supply string to wholesalers, merchants or the final consumer. Toyota motors take care of their own Showrooms in several countries. Toyota motors make their product easily assessable.
Marketing & sales: In true customer orientated fashion, at this time E. K. Kanoo prepares the offering to meet the needs of targeted customers. Therefore they focus strongly upon acquiring the purchased vehicles, coordinating the logistic yard, marketing communications, campaigns combination and showroom display.
Service: This consists of every area of service such as last checking, after-sales service, complaints handling, training and so on. E. K. Kanoo value their customers Support Activities.
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