1.0 Case Introduction:
This case is about the introduction of a new brand of Kao Malaysia Sdn. Bhd. Kao Malaysia is a leading company having third position in the detergent industry of Malaysia with its most popular powder detergent “Kao Attack”. Presently, the company is enjoying a leading position in household detergent market of Malaysia, however, the company has only Kao Attack in the household detergent category and don’t has any product in the liquid detergent category. Rapidly changing consumer preferences and globalization are constantly putting pressures for re-positioning of the company image by introducing new products in laundry detergent industry. The company already has prepared a plan, after a considerable market research, to introduce a new liquid laundry detergent “Kao Attack Compact Liquid Detergent”. Top management wants a final decision, based on the information gathered by market research, by its marketing team on weather it should launch this new product or not. Kao Malaysia was incorporated in Malaysia on March, 1973, as a subsidiary of Kao Corporation Japan, a market leader in Japanese household and personal care industry, with the introduction of a single product, Kao Feather Shampoo. It had since grown to be one of the most prominent manufacturers and marketers of a wide range of household and personal care products. The company has always been a pioneer in introducing new products in the market and wants to keep its image of first mover by introducing a new unique product in the detergent market. Kao Malaysia was guided by the philosophy of producing products that contributed towards building a “clean, beautiful and healthy” society. Extensive studies on better product performance, new technologies and constant product improvements constituted the corporate culture of Kao to match the vision of the company. Support from Kao Japan to Kao Malaysia for technical know-how and new product development has been a great strength in the success of the company in Malaysia. 1.1 Brief Overview of Kao Corporation Japan:
It is appropriate to have a look on the parent company of Kao Malaysia to assess its competitive advantage in the Malaysian market. Kao Corporation's principal business field is consumer products, especially the areas of "beauty care," including cosmetics, skin care and hair care products; "human health care," covering beverages and cooking oils in the "health food product" as well as sanitary products and "fabric & home care" products, such as laundry detergents and household cleaners. In the "chemicals" business, Kao manufactures industrial products with detailed attention to the needs of various industries. In these fields the company aspires to make its contribution with a view towards enriching the everyday lives and the lifestyles of people around the world, through "better manufacturing" from the perspectives of its customers and consumers. (Kao Japan website)
"The Kao Way" is the company’s overall corporate image/guideline for Kao Corporation Japan and its all counterparts worldwide. It consists of “Mission", "Vision", "Values" and "Principles". It is based on "Kao Management Principles" (issued in1995 and partly revised in 1999) and been constantly reviewed and revised to reflect the changes that have occurred in the business environment internally and externally. (Source: Kao Corp. Japan website) Research and development has been the key success factor in the company’s all time success in the industry. The development of products for general household use is the mainstay of Kao’s business operations. To accurately grasp the constantly changing needs of consumers and to provide valuable products that excite consumers and employees both, the company engages in unremitting research through the spirit of "Yoki-Monozukuri." The technologies developed from this research are applied to laundry detergents and household cleaning products that find their...