Panasonic Case Study

Panasonic operates under the umbrella of the Matsushita Electric Industrial Co. Ltd, a conglomerate consisting of firms, businesses and production centers all over the world. Due its immense size the company found that its product and consumer data were often incomplete, duplicated or inconsistent. Furthermore different parts of the company were using different data to other parts of the company. The implications were costly and a signified operational inefficiency. In order to rectify this issue Panasonic decided to pursuer a “single version of the truth”, which replace its current “pull” model of data dissemination with a “push” model. This would create a centralized data bank that would send information to whoever needed it at the same time, and thus ensure uniformity. To realize this objective Panasonic brought in master-data-management (MDM) software from IBM’s WebSphere line. The implementation of this software saved Panasonic millions euros but it was not without problems.

Question 1

As illustrated above the Porter’s Five Forces model was applied in order to evaluate Panasonic’s business strategy.

Figure 1: Porter's Five Forces on the Electronics Industry

The Value Chain framework of Michael Porter is a model that helps to analyze specific activities through which firms can create value and competitive advantage. From a Management point of view, the Value Chain Framework helps to build a relative competitive advantage, together with Porter's Competitive Advantage thinking. The Value Chain Framework can be seen as helping to maximize corporate value creation.

Figure 2: Michael Porters Value Chain Model.

Six Business Functions of the Value Chain: Research and Development, Design of Products, Services, or Processes, Production, Marketing, Distribution, Customer Service.

The case reveals several critical business areas within Panasonic’s value chain.

• Problems with data integration.

• Different data pools which were inconsistent throughout the whole company.

• Lack of information when launching new products – product specifications, manuals, pricing data, and point of sale market information.

• Old and obsolete management information systems.

• Inconsistent, duplicated and incomplete data and information system

• Delayed process of market analysis and product launch

• High administrative cost in order to get information from its business entities

• Low operating margin of 5%

• Operational efficiency not at the top rate. They could launch the products faster.

• Internal refusal in information sharing in order to not lose control.

However, as demonstrated in the case, Panasonic can improve its operational efficiency, achieve cost-saving, and improve customer and supplier intimacy by adopting appropriate information systems in its support activities- the delivery of the primary activities and consist of organizational infrastructure (administration and management), human resources (employee recruiting, hiring, and training), technology (improving products and the production process), and procurement (purchasing input).

Question 2

Problems occurred:

• Because the company had so many different sources of data, the customer and product data were often inconsistency, duplicate or incomplete.

• Different departments of the company used own pools of data, which were isolated from the data that the rest of the company was using.

• Competitors often infiltrate markets, that Panasonic did not reach in its first phase of a launch (because it took considerable time and effort to sift through all the data and create a common set of data for launching products globally)

These problems combined to be a drag on operational efficiency and drained a significant amount of money from the corporation as a whole.

Technology factors:

• Too many different sources of data

• High