Integration of Whirlpool and Inland
During the late 1980s and into the 1990s, Whirlpool Corporation aimed at reducing their number of suppliers to achieve a better competitive advantage from others in the same market. One of the main components purchased and used for products was steel. They decided the best choice was to create an alliance with one of their current suppliers. After carefully considering and answering several different questions within the company, Whirlpool’s attention was brought towards their supplier Inland Steel. During this time period Inland Steel was also aiming to create a new product design that needed much capital (Strategic Alliance). The two companies realized that they both had the same strategic vision that would ultimately lead to a partnership. However, this partnership was going to be no easy task for either party. Although the following quote can be interpreted in various ways, it still has one evident meaning, “It can take years for a buyer/seller partnership to begin delivering results.” What this quote is saying that that overall combining any two firms is not a 1-2-3 ordeal. It takes time, research, money, cooperation, organization and collaboration. Each of the firms must be willing to share information with one another, make the appropriate adjustments, and have the same goals/expectations for the partnership. Additionally, not any combination of buyer/seller firms can make a partnership. The only way for the partnership to survive is be within the same industry. This is because they will be able to offer one another more information and insight to how that company has survived over the years and what competitors at that level are doing. The companies’ leaders must realize the same corporate strategies and be willing to work with one another. In this specific case both a buyer and seller plan to combine to create a partnership, which will benefit the two firms. The two firms shared a common strategic vision, Whirlpool wanted to maintain a competitive advantage and “support its direct customer relationships”, and Inland want to create a more customer-focused market strategy. Whirlpool had been using several different suppliers prior to Inlands approach proposing this alliance. It took Whirlpool and Inland nearly seven years to complete this dominating partnership. Both companies needed to be able to communicate directly with their counterparts (Strategic Alliance). This included every employee from the bottom of the pyramid to the top. Smart businesses will implement suppliers not only to reduce production costs, but also to further into their productions within their market to maximize their sales. The leaders of the two companies needed to put forth the time and effort to complete such a major task without facing little to no flaws. Discovering the best way to clash these two companies in order to produce the supreme result was no easy task. In order to help complete the merging of these two companies, a process known as point-to-point contact is what would help ease the process. Point-to-point process involves the different levels of the value chain communicating and working with the same level in the other company. Whirlpool and Inland made sure to create these links between the various parts of the value chain in the following levels: manufacturing, human resources, accounting, engineering, and sales/marketing with purchasing. As one can see, the connections are not just in the basic jobs but go all the way to the executive level. This connection helps the partnership to cut down costs as well as time. As discussed earlier, it takes years before results are realized so therefore time management is extremely important for these companies to capitalize on their profits. Unfortunately, this form of contact is not as simple as it may seem. Whenever an issue was to arise, the two companies would lay that problem out together and determine the overall best solution. For...
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