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Case Study

1. Does Logitech have any core competencies, and if so, what are they?

Logitech is the company, which takes care of the quality of its services. The company provides its customers with high quality personal computing products. The company is at the cutting edge of technology in the computer industry. The combination of the outstanding customer service and product quality allows the company to remain at the top of its sphere of activity. Regardless of the companys rising competitors, the question of the companys development should not be a problem. The companys core competencies focus on such products as keyboards, mice, and headsets. The contemporary world lives in the era of gaming, which gives the company an opportunity to create innovative products. In fact, gaming will always remain one of the best entertaining parts of human life, which ensures that the company will always have new opportunities for the development. Regardless of the fact that the circle of the companys core competencies is narrow enough to worry about its future, the company will always have a privilege due to the outstanding quality of its products and services. Moreover, it is worth noting that the company has such core competencies as innovation, flexibility, quality, and customer service. These elements help the company to remain competitive and accommodative in terms of both external and internal environment. Probably, in the future, the company will benefit from its core competencies and will be capable of excelling the opportunities of its competitors.

2. What are the primary and secondary components of Logitech’s value chain?

The primary elements of the companys value chain consist of both primary and secondary components. Primary components of the companys value chain include inbound and outbound logistics, operations, marketing and sales, and service. These elements stream from the description of the company and its profile, which proves that the company has a complex system of regulation. Inbound logistics helps to arrange the inbound movement of raw materials, details of the products, or finished inventory, which suppliers provide, to the manufacturing plants. Inbound logistics helps to organize the movement of materials, which provides each department with the required set of resources. Outbound logistics involves the processes, which focus on the storage and movement of the companys products to the store of distribution. It is the process of delivering companys products and services to the customer. Operations formulate another part of the value chain, which converts inputs into outputs by using available resources of the company and turning them in the final product. Marketing and sales, in its turn, help the company to create offerings, which will attract customers by its importance to the society in general. It is the part of combining innovation and creativity aiming to satisfy needs of the target audience. Services help the company to ensure that the product, which the customer purchased, works without any breakdowns and technical problems.

Secondary components of the companys value chain include human resource management and technological development. Human resource management allows hiring, developing, training, and compensating personnel of the company. Technological development, in its turn, aims to provide the company with the necessary information regarding technological knowledge helping the company to grow and develop.

3. Which one of the five generic competitive strategies most closely approximates the competitive approach that Logitech is employing?

According to the companys description, Logitech uses the differentiation strategy with a segmentation strategy. The company successfully differentiates the products and services in order to remain at the top of the market, in which it operates. Logitech successfully applies the strategy as long as it provides the customers with outstanding quality, which customers cannot find in other companies. In the aspect of niche in the differentiation strategy, it is possible to claim that the company takes care of providing the target audience with high quality PC equipment. The audience includes gamers and office workers, who aim to work with high quality equipment without a need to buy new products. The company successfully uses innovation and high quality as mandatory elements in its competitive strategy. Differentiation strategy allows Logitech to remain at the top of the industry and continue to develop in terms of the contemporary technological evolution. Moreover, it is necessary to mention that the company successfully uses the segmentation strategy, which allows focusing on the target audience by continuously excelling the quality, design, and innovative characteristics of the products, which it produces. Finally, the company is capable of balancing between its goals and current position on the market based on the nature of competition. It is most likely that Logitech will continue to use the differentiation strategy in order to compete and achieve strategic goals.

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4. What chief differences do you see between Logitech’s strategy and the strategy being employed at its competitor(s)?

The main difference of Logitech is that the company focuses on the narrow variety of products. Logitech provides its customers with personal peripheral products, which makes the company the only one capable of meeting customers needs in keyboards, mice, and headsets. Other companies strive to invest products and services in the majority of industries related to the technological development. For example, Microsoft continues to sell the same products as Logitech. However, the company entered other markets by selling digital music players, videogame consoles, customer relationship management applications, as well as server and storage software (Hitt, Ireland & Hoskisson, 2013). It is obvious that Microsoft aims to increase its profitability by diversifying the range of its products. However, Logitech applies wiser strategy by focusing on several products, which continue to increase its quality and innovative development. Royal Philips Electronics and Creative Technology, Ltd. also have the same approach towards managing the performance. The companies do not focus on a small variety of products. Logitech proves that it is better to work on quality improvement, rather than trying to win the market in several industries.

5. Describe one (1) recommendation you would make to strengthen the company’s growth and profitability.

As long as Logitech has an effective competitive strategy, it is important to focus on other aspects of the companys performance, which can help increase the companys profitability and growth. First, it is necessary to mention that the company needs to continue excelling its quality and innovation. Customers expect from Logitech outstanding quality of both products and services. The company needs to continue impressing its customers by guaranteed quality. Further, it is necessary to pay attention to the Logitechs value chain. As long as the world enters the era of technological breakthroughs, it is important to extend the existing value chain. For example, the company may create a virtual value chain, which will emphasize the companys involvement in the digital era. It means that the company should enter the cyber market space in order to earn the loyalty of customers within the Internet. Such approach will help to improve the reputation of the company in the light of connecting with customers within the virtual space. For example, the company may monitor the tastes and needs of customers by outlining their opinions through social networks. In fact, the combined value chain will help the customers feel the companys presence both on the virtual and physical levels. Finally, the company will be capable to connect to its customers and evaluate the problems of quality, which it needs to solve in order to reach the new level of development. In general, the value chain of the company should be enough for its evolution and optimization in terms of highly competitive environment. In addition, the companys differentiation strategy with segmentation will accompany both physical and virtual value chains, which will not require any additional investments.

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