Competitive strategy for ACME Electric Motors facing foreign competition

ACME Electric Motors and Controls Company has been fairly successful in the past, but they are currently struggling to cope with the foreign competition which sells similar products at a price $60 lower. In order to cope with the created situation, the U.S. manufacturer has to combine short- and long-term strategies relative to their marketing, operations, finance, human resource and legal agendas. In this order of ideas, they should implement the following courses of action:

Short-term strategies

Marketing

In terms of short-term marketing strategies, the company should try to increase customer satisfaction as to maintain their current customers. At this point, it would be rather risky to try and expand, but the long-term strategy would consider such an option. Then, in terms of product placement, the marketing team at ACME should emphasize on the national provenience of the motors and appeal to the citizens' high regard to the label Made in America, as opposed to the imported products which are manufactured in 'sweatshops' that exploit the inhabitants of developing and less developed countries.

Operations

Regarding the operational processes, the ACME officials should try to increase productivity. This would first require employees to put in extra hours and to increase the quality of their performed tasks. The management should also pressure intermediaries to purchase more items as to reduce the time spent by the motors in stock. For ultimate success however, these strategies must be combined with long-term courses of action.

Finance

On the financial side, the company should strive to reduce operational costs in order to gain the ability to reduce retail prices and beat the competition. A short-term strategy in this instance would be to negotiate terms and deals with suppliers and even change them in order to purchase the necessary commodities at lower prices. They could also delay the payments to the staff members and use the economised money to sell their engines at lower prices. However these strategies are viable on the short-term, if they are to be implemented on the long-term, they could do more harm than good.

Human Resource

In terms of staff members, the company could initially conduct a corporate restructuring. This basically means that they analyze all jobs and positions within the organizations and try to identify those that are not entirely necessary. This would lead to some employees being downsized and costs would once again be reduced. In doing this however, the ACME officials must be able to redistribute the tasks of the eliminated positions to other capable employees, but they must be aware not to suffocate the remaining staff with too many tasks.

Marketing

On the long run, the American organization should try to enlarge and consolidate their market share. They should constantly conduct research as to identify the new needs and wants of customers and integrate them within the ACME products. The success of this strategy will be obvious once the manufacturer is able to identify and satisfy needs before the clients become aware they even had those demands. The long-term strategy will be a pull one, where the audience is drawn towards the product, placed and promoted to represent the American tradition.

Operations

The ultimate operational desire for the ACME officials should be to increase efficiency. To achieve it, they should implement time management programs. These programs are aimed to increase the quality of the tasks performed within a given time. Also, they should combine them with training programs that teach employees how to reduce procrastination and how to work better. However these trainings would initially require additional expenditures, they would pay out in the long-term as the company would be able to reduce the number of employees and the remaining ones would be highly skilled and therefore able to cope with the extra work.

Finance

However the delay in the purveyor and employee payment can retrieve some successful results, this is only possible in the short run. On the long-term, the company has to find other ways to keep costs to a minimum as to be able to offer a reduced retail price for their motors. In this order of ideas, they should apply for governmental subsidies and should increase their capital through either loans or stock issuing. Each of the two alternatives has both advantages and limitations, but the issuing of stocks has the advantage that shares could be sold to ACME employees as an incentive. Also, the company should make increased efforts to recover all their account receivables and reinvest them in an efficient manner.

Human Resource

On the long run, the staff members must be motivated to increase their performances. The corporate officials must align the individual goals of employees with the overall goals of the organization and this would then ensure that the workers perform at higher standards and support the company in reaching its objectives. A way to do this could be to allow the employees to purchase corporate stocks and directly participate to the profit sharing - as such, they would be personally interested in the organization's success and would work harder.

Legal

Aside from acquiring patents for their products, the company should forward request for state subsidies. Their requests would be backed by strong arguments that would convince the federal authorities to subsidize ACME Electric Motors and Controls Company. These arguments would revolve around the need to protect small and medium size national entrepreneurs from the threat of cheap foreign products. Basically, due to the need to preserve the American industry, the federal powers should support the future development of ACME and could offer financial subsidies that would allow the manufacturer to reduce their retail prices.