Executive Summary
AB Sandvik Saws & Tools Business Unit has developed a world-class competence in ergonomic hand-tools design and manufacture. The company's strategy was to use this competence as the 'Ergo strategy' to establish a global position in the professional hand-tool business. However, the initial sales of the Ergo tools, already introduced, were not as strong as hoped, especially in the North American market. After assessing the situation of Sandvik's Saws and Tools Business Unit and arguing that one competency is not enough to break into a new market this paper provides a solid recommendation for the future strategy for Sandvik's Ergo tools business. The main point of the recommendation is to invest in another important element for the success - a new distribution strategy, namely a Web based B2B Portal – an online platform that would help in providing the balance between the core competencies and the customer value.
The paper is build according to a specific requirements format and its main report consists of five sections. First section, introduces the situation at Sandvik Saws and Tools, by articulating what Gezelius (the president of Saws and Tools Business Unit) is trying to accomplish with the hand-tools business and where the Ergo-tools and the Ergo strategy fit in. Second section, examines the Hand Tools industry and articulates its global aspects. Third section examines how unique the competency of Sandvik Saw and Tools products and how valuable it is. The fourth section, analyses the benefits of the ergonomic-design, the added value it creates for the buyers/customers and whether these benefits exceed the cost. Finally, the fifth section provides a recommendation on the strategic direction Gezelius's Business Unit should pu ...