Topics: Balance sheet, Technology, Automotive industry Pages: 7 (807 words) Published: February 27, 2013

Technological Innovation
Elio Engineering, Inc.
Robert A. Burgelman, Clayton M. Chrisensen, and Steven C. Wheelwright, Strategic Management of Technology and Innovation,, 5th eddition, McGraw Hill, ISBN 0073381543, 2009

Question 1

What is the Structure of the Automotive seat in 1998?  How Attractive is it?



Answer 1

Two tier 1 companies
– JCI and Lear

60% of the market

 

3rd place Manga
– 10% of the market

Mature industry with stagnant technology

Competition would be fierce with the 70% of the market controlled by three companies.  New technology and cost reductions could help get a foothold.

Question 2

Describe Elio Engineering.  What are the potential sources of competitive advantages?  How sustainable are they? Why and why not?



Answer 2
Describe Elio Engineering.

Elio Engineering was started by an individual who had an idea that could revolutionized the ABTS called “No Compromise seat”.  No Manufacturing capabilities – Including design for and testing

No capital to build-and-test.  Relied on simulation software to provide proof of concept.  Few employees with highly specific knowledge

Answer 2
What are the potential sources of competitive advantages?

The idea was well patented.  Insider knowledge of the seating industry  Not a supplier tied to one automotive company and market.  The inventor was highly motivated and was able to find resources.



Answer 2
How sustainable are they? Why and why not?

If Elio Engineering entered the market alone they would fail due to the lack of resources. The core value of this company is wrapped around one patent. They do not have the means to fully protect and produce the product by themselves which could lead to a larger company buying them out.

Answer 2 Seat Technology Comparison
Cost Seat Components/Mechanisms FrontSeat Seat Belt Advantages Disadvantages


$500 Frame, recliner and seat tracks, gears mostly manual.

Attached to door Inexpensive, lightweight, pillars & floor. easy to assemble.

Low strength-toweight ratio, fatal injuries to passengers.


$750 Fundamentally same concept (conventional), stronger to meet safety regulations.

Seat belt into the seat

Ease of use, attractive, levels.

Passenger recede more expensive, twice as heavy.

higher comfort and safetly in a rear impact,

NC seat

Cheaper than Fewer and lighted traditional ABTS parts (single sided recliner), based on cable and drums, no load-leveling recliner,

Seat-belt retractor located at the bottom of the back frame bottom to top)

State-of-the-art tech, High strength-to-weight ratio, no catastrophic failure, Light at least as a conventional seat, comfort and easy to use, easy to assemble, simplicity design, cheaperno expensive parts

gears, easy adjustable, (routed from



Question 3

How Well is Elio Engineering’s technical strategy aligned with the technical requirements for a successful entry into the automotive seat market?  What, if anything, should they change?

Answer 3

   

Elio Engineering has taken the right steps to ensure they are aligned to the regulatory requirements. Obtained a strong patent which would deter companies from copying their design Need to design for manufacturability Need to have a system integration approach to ensure a market for their design. Without a partner Elio Engineering would most likely fail. There approach to the market indicates they are looking for a strong partner.



Question 4

What is Elio Engineering's visions.
– Supply to all automotive companies – Supply to trucking companies – Develop a technology that will benefit the end

user and reward the innovator.

Question 5

Define the following terms – Assets – anything a company owns including cash. Assets get recorded...

References:  

 
[1] "Asset," accessed 9/6 [2] John Reh, Earning Statement, m [3] Earnings Per Share ‐ EPS
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