If you cannot beat your rivals, don't join them. Rather, make them irrelevant—that's the essence of the management strategy, popularly known as the "Blue Ocean Strategy". Hence, when LG Electronics India, a subsidiary of Korean electronics giant LG, announced to follow the footsteps of its parent, which is implementing this strategy in its subsidiaries, worldwide, it marked a strategic shift in its long-drawn approach of being a mass-marketer, which enabled it to win market share and mindshare in the Indian market. However, of late LG India has been failing to sustain its leadership. Through its new strategy, the company hopes that it will not only capture new and unexplored markets, but also consolidate its market leadership in fast growing segments of consumer electronics, home appliances, and mobile handset markets. Armed with its new strategy, LG India plans to double its sales volume and profit by 2010 with 30% of its sales volume and 50% of its profit coming from Blue Ocean products.
The Korean major, which made a failed attempt in 1993, re-entered in 1997, only to emerge as a formidable player in India's fast expanding electronics market. Having learnt its lessons well, in its second foray, the company went on to acquire leadership in several segments of the electronics market in the country. Within a decade, Kwang Ro Kim, the then MD of LGEIL was instrumental in making the Indian subsidiary, a giant worth $2 bn. However, after being on the fast track of growth for long, the company has, in recent times, been finding it hard to replicate its past success. |
