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Creation of a market entry strategy for a major research and development institute planning to enter the distributed electric power generation market in Europe and Asia

Company B, a leading airline, had continued to make profits throughout the 1980s owing to market expansion. However, in the 1990s, the company found itself in the red owing to the impact of the Gulf War and increasingly stiff competition following the liberalization of the airline industry in the EU. With the all-out assistance of Roland Berger, the company was able to get back onto a growth track in three stages.

1. Implementation of a drastic cost-cutting program to reduce the deficit: The company was able to return to profitability in one year through a rationalization process that began with the slimming down of its bloated organization to an appropriate level through personnel cost reduction and the cutting of operational costs through such measures as operating process reform.

2. Restructuring of the organization and its businesses in order to respond quickly to both environmental and customer changes and to realize a higher level of service: We converted the company from its original large-company model to a new group management model and created small business units through specialization and spin-offs, accelerating the speed of management decisions, clarifying accountability, strengthening customer response capability and increasing the transparency of costs.

3. Establishment of sustainable competitive advantage through the further strengthening of competitive capability and ongoing cost reduction at the operational level: We established a customer orientation and strengthened cost awareness at the frontline by thoroughly incorporating the business and organizational reforms described above at the operational level.

Roland Berger played a big role in the entire process, going beyond cost-cutting measures to lead the implementation of business and organizational restructuring aimed at future growth, establishing a clear structural reform concept, drastically restructuring the business model, communicating the growth scenario to people at the operational level and overseeing implementation.

Hisaji Yoneda
Partner
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Ryuji Ono
Partner
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