Sample VIM AB Developed Manufactured Marketed and sold Household Sewing Machines Essay

VIM AB developed, manufactured, marketed and sold household sewing machines. Electronic

and computerized models were manufactured at the Husqvarna plant in Sweden, while low-priced

mechanical machines and over-lockers were sourced from Asian manufacturers. When Santa

Rehnquist came to VIM, much of his work was directed towards improving the company’s market

orientation. The number of concurrent changes in the company made for a window of opportunity

to redirect the strategic focus of the company. An intense weekend meeting in April 1997 marked

the beginning of a very busy period for the top management team. Mr. Rehnquist explained:

We started off with a week-end meeting on a country resort. I didn’t even bring in a

consultant this time. I have done that in the past, but this time I was so fresh on the job that I

was the one who could ask all those `stupid’ questions.

During the first meeting, the basic scope of the strategy document was laid out while further

refinements and changes were made during the summer of 1997. The new mission statement3 and

the companion strategy document were presented to middle management in a series of seminars.

The opportunity to participate in the strategy process was a new experience to most of the people

involved. Some took a dim view of the amount of time spent away from more pressing matters such

as low sales or the installation of a new accounting system. Nevertheless, the high involvement

3 Please refer to the mission statement in the Appendix.

Case Study 12 VSM.rtf 3

Case Study 12 VSM.rtf

seemed to pay off. The strategy document was often referred to for guidance on operational matters

and the mission statement was frequently promoted in the company’s public relations. The physical

appearance of the strategy document was very plain; it consisted of folded and stapled photocopies

wrapped in a two-color sleeve. This was a reflection of the concern that the VIM management had

about setting in stone something that was inherently an ongoing process. The strategic conversation

within the top management team continued with at least five off-site workshops a year, formally

dedicated to assessing the company’s current strategic position. Summing up this initial process, Mr.

Rehnquist said:

The first attempts were very unstructured and people were complaining about how it was all

empty phrases and buzz words. My point is that, it is only when you engage in that type of

discussion that you may come to realize that your thoughts aren’t that clear after all.

Making it happen

Retailers were very important to VIM in their new plans for future profitability. This crucial

link to the customers became a targeted area for VIM with the arrival of the new CEO. One

important effort in this direction was the programmed to transform the retailers into `Dealer-

Partners’.4 The concept included extended support for business development to encourage them to

carry the Husqvarna Viking product line exclusively. Marketing Director Sofia Axels son put it this

way:

There have been tremendous changes in VIM since Santa [Rehnquist] came here, there

really have. But we may change all we want; the customer only meets the retailer and as

long as the retailer doesn’t change, the customer won’t perceive any change at all.

In the US, VIM started to cooperate with Jo-Ann Fabrics & Crafts, a large retailer of fabrics

with over a thousand stores nationwide, setting up small sewing machine outlets inside their fabric

4 Vim’s name for exclusive retailers under special contracts.

 

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