Garmin Corporate Strategy You are now the CEO of Garmin Incorporated. You've watched your industry and your business rise to prominence and you've watched as your competitors have slowly eaten away at your share of the market. At the same time, you've witnessed your bread and butter automotive opportunity erode before your very eyes.

Company Overview

Garmin has been an innovator in Global Positioning System (GPS) technology as well as a worldwide provider of navigation, communication, and information devices which are all somehow related to GPS systems. Garmin is a global company that operates through a global network of subsidiaries and the parent organization and home office is located in Taiwan. There are four broad categories in which Garmin's products are produced in; the automotive, outdoor/fitness, marine, and aviation products are the respective product lines.

Within 5 short years, the GPS manufacturer went from a small niche producer to a publically traded mass producer of GPS devices. However, since GPS technology has peaked and there are now many companies competing within this segment, the opportunities for Garmin have diminished significantly in its core business. In late 2007, Garmin's stock price reached a record high of over one hundred twenty dollars a share. The impacts of the boom and must that Garmin experienced are clearly visible on their 10-year stock price chart (pictured below).

However, later in 2008, the stock price plummeted below twenty dollars a share in the Great Recession. Afterwards, the company's financials rebounded some and now rests in the fifty dollars per share neighborhood. However, the company faces a new set of immense obstacles. The diminishing automotive GPS segment is one of the cornerstones of the business however technology dispersion and advancements. Garmin, as a company, has to quickly reinvent itself and evolve to survive. This will likely require that the company diversifies into new market segments. Garmin must continue to dominate the segments that are in decline however to support its future ventures.

Figure 1 - Garmin 10YR (Google Finance, 2013)

The GPS Industry

In 2007 Garmin dominated the U.S. market in regards to market share. However, it concentrated on this market and...

The company was able to capture a forty-seven percent share of the market in the U.S. which was over double that of its nearest competitor. However, in 2006 and 2007, the industry for GPS devices was at its all time peak. This market grew exponentially as soon as the Department of Defense (DoD) let GPS equipment become available to the public in May of 2000. Since that time consumers have made the use of GPS nearly ubiquitous. Some experts predicted that the entire GPS industry would go from a three billion dollar industry in 2008 to a six to eight billion dollar industry by 2012 (Lorimer, 2008).
Figure 2 - GPS Industry 2007 (Fletch, 2008)

Advances in Technology

What most people didn't realize at the time of the GPS explosion is that there were disruptive technology advancements looming. One of the most notable threats to the industry came from Google who was rapidily developing the cell phone platforms. When the Motorola Droid was released on the Android 2.0 phones', it offers a feature known as Google Maps Navigation (Bourdeaux, 2009). Not only did Google offer this as a free application, but the application itself was superior in many ways. For example, while Garmin's products have to store their map information on the device itself, Google's technology uses the "cloud" for its map technology; which is in turn supported by advancements in mobile broadband. Furthermore, the Google GPS platform never needed an update because of the cloud technology and always had the most current map data available from Google maps. Garmin users, by contrast, would have to periodically update their maps manually through software updating releases. Thus the cloud-based mapping solution was deemed superior by many of millions of consumers.

Investors also started to recognize the decline of the GPS device; "What we saw for the first time is that selling prices fell, but volumes didn't improve enough to compensate," analyst Eric de Graaf of Petercam said after the financial results were reported. "It's a signal the market is getting saturated (Sterling, n.d.)." The industry completely turned on Garmin in a relatively unpredictable fashion. While the market was formed in the U.S. By regulatory admissions, the increases in competition of different…