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Neha Enterprises: Turning the Tide with Strategic Choices amid Trading Decline
內容大綱
In January 2024, the chief executive officer (CEO) of Neha Enterprises (NE), based in Meerut, India, faced challenges in operating his custom pipe-trading business due to declining profitability and resource constraints. NE was a customized pipe trading and manufacturing company that, over the last 30 years, had focused primarily on resolving customers’ problems through customization, precise cutting, and finishing of pipes. It had 900 small and 10 large, specialized customers. After the COVID-19 pandemic strained profit margins, the CEO was exploring new avenues such as offering contract manufacturing for gym equipment, e-rickshaws, and wall beds. Contract manufacturing provided profit margins that were much higher than those earned through traditional pipe customization, but the CEO quickly realized the risk of juggling both a traditional trading business and contract manufacturing. Now, he had to decide whether to disengage from the customized pipe business or continue with contract manufacturing. Should the company standardize or reduce its trading portfolio, form a new contract manufacturing firm, or focus on serving a few medium and large customers?
學習目標
This case is suitable for graduate- and postgraduate-level students. It can be used for foundational and advanced courses in strategy (i.e., strategic management, advanced competitive strategy, and advanced strategic management) to teach the concept of the end of competitive advantage. It helps students develop strategic frameworks to explain how companies should deal with the end of competitive advantage and grab new opportunities. It can also be used to discuss Porter’s generic strategies, competitive advantage, and strategic change management. After working through the case and assignment questions, students will be able to do the following:<br><ul><li>Define and describe strategic shifts and disengagement.</li><li>Explain the concept of the end of competitive advantage and traps related to this.</li><li>Define the customer relationship.</li><li>Define the concept of transient advantage.</li></ul>