Managing Maturing Businesses Restructuring Declining Industries ...

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Managing Maturing
Businesses
Restructuring Declining Industries and
Revitalizing Troubled Operations
Kathryn Rudie Harrigan
Columbia University
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Lexington Books
D.e.
Heath and Companyl lLxington, Massachusetts/Turonto
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MCASr
Contents
Figures vu
Tables
IX
Foreword xi
Boris Yauitz
Preface xv
Acknowledgments xix
1. The Problem-Widespread Industry Maturity
The Endgame 1
The Nffi:J for
Preemp(i~
Action 6
Notes 8
2. Strategy Options-Flee or Fight? 11
SU3rcgy Alternatives 12
Exit Strategies 13
Survival Srrattgies 16
No Single Success Pattern 28
Summary 29
Note 30
3. Assessing Profitability Potential
(to Avoid Pyrrhic Victories) 31
The Endgame Strategy Matrix 31
Assessing Endgame Attractiveness 33
Notes 51
vi 
Managing Maturing BUSInesses
4. Restructuring Industries 55
Exit Barriers 55
Reducing Exit Barriers 61
OYercoming Implementat ion Barriers 68
Notes
70
5.
Matching Management Systems to Maturity
73
Cash Generator Businesses 73
Creating Strategic Flexibility 79
Notes
92
6. Illustrative Example-Maturity in Mainframe Computers 95
The Product 95
Demand for Mainframe Computers 97
Substitutes for Mainframe Computers 101
Marketing of Mainframe Computers 108
Suppliers to the Mainframe-Computer Manufacturers 109
Competition in the Worldwide Mai nframe-Computer Industry 109
Vignettes of Selected Competitors
114
The Mainframe-Computer Endgame 120
Note
121
7. Implications for Governments 123
Corporate Strategy and Performance 123
Changes in Public Policy 127
Future Public-Policy Dilemmas 142
Summary 146
Notes
146
Bibliography 149
Index 159
About
the
Author 169
Index
Page numbers followed by n indicate material in footnotes.
A&P, 87
A.B. Dick, 36
A.H.
Robins.
76
Abbot[ LaboratOries, 43
Acerinox, 60
Acetylene industry: declining demand
growth and. 38;
divestiru~
strategy
and, 13; shrinking selectively and,
2.
Agriculture, in Japan, 132
ALCOA, 47-48
A1locative efficiency, 124-125; anti·
takrover laws and. 125
AIIair, 113
Aluminum industry. competitor
strength and. 47-48
Amclahl Corporation, 114,115
American Airlines, 107
American Motors Corporation, 25
Amoco Italia, 21
Antitakrover Laws, resource allocation
and, 125
Antitrust policy, technical efficiency
and. 130
Apple Computer, 26, 113
Argentina, bulk chemical industry and,
39
Ashland Oil Inc., 14, 131-132
Assets: of competitors, buying, 63-64;
holding invesnnent level and, 22-
23; increasing invesnnent and, 18-
19; milking, 14-16; selling to lower
exit buriers, 66-67; swapping of,
lowering competitors' exit barriers
and, 64; and using effectively,
87-91
AT&T,44-45
Automobile industry: declining
demand growth and, 35; increasing
investment and, 17-18; product
differentiation in, 42; shrinking
selectively and, 25; technical
efficiency and, 128-129
B.F. Goodrich, 18
Babbage, Charles, 110
Baby food industry: customer naits
and, 43; declining demand growth
and, 3, 34, 37; enduring niches of
demand and, 36; shon-term
perfonnan~
goals and, 143;
shrinking selectively and. 24
Baby panty industry, declining demand
growth and, 34
Banking, use of mainframe computers
in, 106
Barbed-wire industry: exit barriers
and, 64; increasing investment and,
19
Barrel making industry, divestiture
and,14
BASF A.G., 119
Bass Brothers. 131-132
Batch prCK.':essing. 103
Batesyille Casket Company, 82, 84,
8.
Beatri~
Companies, 68, 126
Ikaunit Corporalion, 19
8eghin-Say, 126
Belgium, steel industry and, 141
Bell Labs, 111
Bethlehem Steel, 27
Bombardier, 35
Borden, 86, 126
160 
M£l1Ulging Maturmg Businesses
Brazil: bulk chemical industry and,
39; economy of. 131 n
Bridgestone Corp., 18
Bristol.Myers. 15
Britain: automobile industry and.
128-129; computer industry and,
116-117; petroleum refining in·
dustry and, 21, 64; steel industry
and. 60
British Petroleum, 21, 64
Broken Hill Proprietary Ltd., 19.64
Budgets, horizon, lowering uit bar·
riers and, 65
Bulk chemical industry: cross·
production agreements and aSset
swaps and. 64-65; declining de·
mand growth and, 39; exit barriers
and, 64-65; shrinking selectively
and. 27-28
Burial casket industry, operating flex·
ibility and, 82-83, 84, 86
Burlington Industries. 19
Burroughs Corporation, Ill. 112,
113. 119-120
Business, use of mainframe computers
in, 106
Canada, food·proassing industry in,
12.
Capacity. See Excess capacity
Capital, patient, 74-75
Capital base, eroding, 143
Carbon black industry, choice of ven·
dors in, 131-132
Cargill, 19
Carnation, 133
Cartels, 141
Cash generator businesses, 73-79;
assumptions underlying, 75-79;
risk versus rtturn tradeoffs and.
74-75
Caterpillar Inc., 22
CF&J Steel, 67
Chain saw industry, operating flexi·
bility and, 84
Chen, Stephen, 114, 118
Chevrolet, 23
Chic! information officers, marketing
of m:ainframe computers and. 108
Chile, bulk chemical industry and. 39
Chrysler Corporation, 25, 35, 67
Ciba-Geigy, 26
Cigar industry: declining demand
growth and, 3, 34, 38; divestiture
and, 14; enduring niches of de­
mand and, 36; exit barriers and, 63
Clayton & Dublier, 18
Coca·Cola USA, 68
Coffee maker industry.
See
Percolator
coffee maker industry
Colgate·Paimolive, 131
Colombia, bulk chemical induStry and,
3'
Colossus, 110
Colwnbian Chemicals Company,
131-132
Competition, 2-6; excess capacity
and, 3, 5; global endgame and,
5-6; in global mainframe computer
industry, 109-113; slowing sales
growth and, 3
Competitor(s): bchaviors of, prof.
itability potential and, 44; in corn·
puter industry, 114-120; facility
sharing by, 26; lowering exit bar·
riers of, 63-65; maverick, 5 n
Competitor.intelligence system, 80
Competitor strength, 47-51; an·
ticipating competitive behavior and,
47-48; as liabilities, 48-49; market
share and, 49-51; recognizing
sources of, 48
Computer{s): mainframe, 95-96; tran·
sistorizcd,111-112
Computer industry, 26, 95-121; de­
mand and, 97-101; endgame and,
120-121; marketing and, 108-109;
product and, 95-97; selected corn·
petitors in, 114-120; semiconduc·
tor industry and, 35-36; substitutes
for computers and, 101-108; sup·
plier bchavior and,
43-44; sup-­
pliers to, 109; worldwide, competi­
tion in, 109-113
Computer Research Corporation, 111
Conoco, 64, 131
Construction machinery industry,
holding investment level and, 22
Consumer welfare. maximization of,
128-133
Continental A.G., 17
Continental Carbon Company, 131
Control Data Corporation, 112, 113,
114
Cooperation, 140-141
CoSt effectiveness: holding mvestmenl
level and, 23; increasing investmenl
and, 19-20; milking, 15-16
CoSt reduction, cash generator
businesses and, 78-79
Courtalds,
23,
29
Cray, Seymour, 112
Cray Research, 113, 114
Cross-production agreements, lowering
competitors' exit barriers and,
64
Crown, Cork
&
Seal, 85
Crown Central Petroleum Corp.,
21
Crude oil industry: increasing invest­
ment and, 20-21.
See also
Petroleum refining industry
Cultural values, changing, 145-
146
Customers: exit barriers and, 57-58,
61-63; for mainframe computers,
103-108; maximization of con­
sumer welfare and, 128-133;
opportunistic, 41; traits of,
profitabiliry potential and, 42-43
Customization, cash generator
businesses and, 77-78
Daihatsu Motor, 35
Data processing, centralized and
distributed, 103
Demand: enduring niches of, 36-37;
exit barriers and, 60; flat or de­
clining, 2, 60; for mainframe corn·
puters, 97-101; revitalizing,
39
Demand growth: declining, 3, 34-41;
acetylene industry and, 38; auto­
mobile industry and, 35; baby food
industry and, 3, 34, 37; bulk
chemical industry and, 39; cigar in­
dustry and, 3, 34, 38; electronic
component industry and, 35-36;
enduring niches of demand and,
36-37; expectations and, 34-36;
forecasting, 39-40; percolator cof­
fee maker industry and, 38; pre­
dicting effect of, 37-38; rayon
acetate industry and, 37; receiving
tube industry and, 34, 38; speed of
decline and, 38-39; steel industry
Index · 161
and, 36-37; synthetic soda ash in­
dustry and, 37-38; whiskey in­
dustry and, 39
Demographics, forecasting demand
growth and, 39-40
Diamond Shamrock, 13
Diamond Star Motors, 35
Dick,
A.B.,
36
Digital Equipment Corporation, 112,
114-115
Distilling industry: declining demand
growth and, 39; divestiture and, 14
Distribution systems: divestiture and,
16; use of mainframe computers in,
108
Divcstiture: approach to, 13-14; tim·
ing of, 13-14; toothpaste industry
and, 15
Dow Chemical, 2, 27-28, 29, 44, 64
Drake Bakeries, 126
Drugs. See Pharmaceutical industry
Dunlop Tire Co., 18
du POnt,
14, 23,
26, 29, 64, 76
L!.
du POnt de Nemours,
12, 23,
26,
29, 64, 76
Eckert-Mauchly Computer Corpora­
tion, 11 0-111
Economic exit barriers, 59-60
Education, use of mainframe com-
puters in, 106-107
Electric-Leo-Marconi Company, 116
Electro-Data Corporation, 11
t
Electronic component industry, declin-
ing demand growth and, 35-36
Elliot Automation, 116
Employees, making into allies, 69
Employee Stock Option Plans
(ESOPs),66
Endgame, 1-6; assessing attractivencss
of, 33-51; assessing competitor
strengths and, 47-51; choosing
managers for, 88-89; competitive
environment of, 2-6; declining de·
mand growth and, 34-41; global,
5; industry structure and prof·
itability potential and, 41-46; lack
of theory and, 6-7; mainframe
computers and, 120-121; need for
new approach during, 1-2; new
in·
dustry relationships and, 7-8;
predictable, 29; strategy matrix for,
162 
MarnJgmg Maturing Businesses
Engdame:
(Continued)
3 I, 33; timing and, 8; unexpected,
28; winners in, 7
Engineering Research Associates, 111
Enichem,64
England.
Set!
Britain
Europe: automobile industry in, 35,
128-129; bulk chemical industry
and, 39, 64; computer industry
and; 110,116-117; construction
machinery industry in, 22; crude
oil industry in, 21; cusromers for
mainframe computers and, 104;
food-processing industry and, 126;
Single European Act and, 126-127,
130, 132; steel industry and,
36-37,43,60; technical efficiency
and, 128
European Economic Community,
126 n, 141
Excess capacity, 144-145; in bulk
chemical industry, 27-28; cash
generator businesses and, 78;
global,S n; slowing demand
growth and, 3, 5
Exit barriers, 55-61; of competitors,
lowering, 63-65; customer­
oriented, 57-58; economic, 59-60;
falling demand and, 60; financially
oriented, lowering, 65-66; harm
caused by, 56-57; lowering,
63-68; managerial, 61; reducing,
61-68; relationships with custom­
ers and, 62-63; retrieving
in­
vestments in intangibles and, 66;
selling assets and, 66-67; strategic,
57-59; strategic flexibility and, 56;
venical integration as, 58-59,
67-68
Exit 5trategies, 12-16; divestiture as,
13-14; milking investment as,
14-16
Expectations: for computer demand,
99-101; declining demand growth
and, 34-36; of employees, 69
Exxon,
641'
Farm machinery industry: competitor
behaviors and, 45: operating flex­
ibility and, 85
Federal Trade Commission, 131-132
Ferrami,116
Fertilizer industry: exit barriers and,
64; increasing investment and, 19
Feruzzi, 126
Fiber-optic cable industry, competitor
behaviors and, 44-45
Financial institutions, use of main-
frame computers in, 106
Fintermica, 21
Firestone Tire
&
Rubber Co., 18
Aexibility: market share and. 50-51.
Su
also
Operating flexibility;
Strategic flexibility
FMC Corporation, 51, 126
Food-processing industry: anticipating
maturity in, 126-127; operating
flexibility and, 83, 86
Ford Motor, 35, 128-129, 145
Forecasts: of demand growth, 39-40;
horizon, 80-81
Foremost-McKesson, 83
France: bulk chemical industry in, 64;
food-processing industry in, 126
Fujitsu, 114, 115, 119
GenCorp, 17
General Cinema, 68
General Electric Company, 15,51,
111-112,113
General Motors Corporation, 23, 25, 67
General Tire
&
Rubber Co., 17-18
Georgia-Pacific, 48
Gerber Products, 29, 63, 143
Germany.
See
West Germany
GilIette, 36
Glaxo,76
Global markets, cash generator busi-
nesses and, 77
Golden handcuffs, 90
Goldsmith, James, 17
Goodrich, 8.F., 18
Goodyear Tire
&
Rubber, 17-18
Government, 123-146; changes in
public policy and, 127-142; cor­
porate strategy and performance
and, 123-127; public policy dilem­
mas and, 142-146; use of main­
frame computers in, 104
Great Nonhern Nekoosa, 48
Grocery retailing, operating flexibility
and, 87
Groupe
Bull,
116, 140-141
Gulf
Oil,
21
H.]. Heinz, 83, 143
Hardware, for mainframe computers,
109
Harley-Davidson, 24
Hanmarx,83
Havatampa Cigar, 29
Hays Petroleum Services, 21
Healthcare, use of mainframe com-
puters in, 107
Heinz, H.J., 83, 143
Hercules, 140-141
Herfindahl-Hirschman Index, 140
Hill enbrand Cocporation, 82
Hill Petroleum, 21
Hitachi Ltd., 114, 115, 118, 119
Home appliance industry, operating
flexibility and, 84
Honda, 17, 35, 42
Honeywdl, Ill, 112, 113, 115-116,
140-141
Honeywell-Bull-NEC, 115-116,
140-141
Horizon budgets, lowering exit bar­
riers and, 65
Horizon forecasts, 80-81
Hospitals, shrinking selectively and,
24
Human assets, investing in, 90
Hyatt-Clark Industries, 67
IBM,
109,
Ill,
112, 113,114,116,
117-119
IC Industries, 68
ICL,11 6-117
Imperial Chemical Industries, 64
Implementation barriers, overcoming,
68-70
Industry concentration, rising, 133,
140
Industry maturity, anticipating,
125-127
Industry restructuring, 7-8, 55-70;
exit barriers and, 55-68; overcom­
ing implementation barriers and,
68-70
Industry structure, profitability poten­
tial and, 41--46
Inland Steel Industries, 27
Insurance industry, use of mainframe
computers in, 106
Intangibles, retrieving investments in,
66
Index. 163
Intel, 113
Intell igence, strategic flexibility and,
80-81
International commerce, 144-145
International Computers and
Tabulators, 116
Investments: holding, 21-23; increas­
ing, 17-21; in intangibles, retriev­
ing, 66; milking, 14-16
Isuzu-Subaru, 35
Italy; bulk chemical industry in, 64;
construction machinery industry
and, 22; crude oil industry and, 21
].P. Stevens, 19
Japan: agricultUre in, 132; automobile
industry and, 35; bulk chemical in·
dustry and, 39; computer industry
and, 110, 11 5, 116, 119;
customers for mainframe computers
and, 104;
kanban
relationships
and, 84, 144 n; semiconductor in­
dustry and, 35-36; steel industy
and, 36-37, 43, 85-86; technical
efficiency and, 130
Jaquet, 126
Jewd,87
Joint ventures, internal, 69-70
Kaiser Aluminum, 67
Kanban
relationships, 84, 144n
Kawasaki Steel, 86
Kia Motors, 35
Kirin Brewery, 68
Kobe Steel Ltd., 86
Korea.
See
South Korea
Kuwait, crude oil industry and, 20, 21
Kuwait Petroleum Corp., 21
Labor unions, buyou[s and mergers in-
itiated by, 66-67
Laggards, 36
L'Amore,
15
Last iceman strategy, 17-21,46; ap­
proach to, 17-18; asset deployment
and, 18-19; automobile industry
and, 17-18; barbed wire industry
and, 19; cost effectiveness and,
19-20; crude oil industry and,
20-21; fertilizer industry and,
19 ~'
2\
pricing and, 18; rayon acetate in-
LLRC
dustry and, 19; receiving tube
i
MCM,V
164  Managing Maturing
Busin~$Sts
Last iceman strategy:
( Contmu~d )
industry and, 19, 20; textile in­
dustry and, 19; timing of, 18,
20- 21; tire industry and, 17-18
Laws. anti takeover , 125
Leather goods industry, enduring
niches of demand and. 36
Lesieur, 126
Libya, crude oil industry and, 21
limited, The, 87
Lincoln-Mercury, 42
Logistics, operating
fl~xibility
and,
82-83
Lord
&
Taylor, 87
L
TV
Corporation, 66-67
Mainframe computer, 95-96
Manager(sl, for endgames, 88-89
Managerial exit barriers, 61
Manufacturing, use of mainframe
computers
in,
104
Manufacturing base,
loss
of, 143-144
Mapco Inc., 21
Marketing, of mainframe computers,
108-109
Market share, 49-51; cash generator
businesses and. 76-78; flexibility
and,50-51
Martell, 126
Maverick competitors, 5 n
May Deparrment Stores, 87
Mazda Motor, 35
MC) Communications. 44
Mead Johnson, 24, 29, 43
Mercedes-Bc:nz, 42
Metal fabricarion industry, operating
flexibility and, 85
Microproa:ssors, introduction of,
113
Military, use of mainframe comput­
ers in, 104
Millinery equipment industry, de­
dining demand growth and,
34 '
Minicomputers, 112-113
MITS,I13
MitSubishi, 35, 129
Mobil Oil, 21
Monsanto, 64, 111
Montedison, 64, 140-141
Mororcycle industry, 24; operating
flexibility and, 84
National Advanced Systems, 114, 118
National Cash Register, III
National Semiconductor, 118
NCR Corporation,
Ill,
112, 113,
118-119
NEC Corporation, 114. 116, 140-141
Nigeria, crude oil industry and, 21
Nippon Electric Corp.,
116
Nippon Kokan, 86
Nippon Steel Corporation, 86
Nissan, 35
Nixdorf Computer A.G., 119
NOTris, William, 111
Norsk Hydro, 19,64
Norstrom, 87
Nonh American Philips, 19
Occidental Petroleum, 64
OiL &e Crude oil industry;
PetToleum-rdining industry
Olin Corporation, 63
Olsen, Ken, 112
OPEC, 20
Operating flexibility, 82-87; logistics
and. 82-83; quality and, 83-84;
service and, 84-86
Operating-system software, 109
Opportunistic customers, 41
Pan Am, 67
Paper industry. competitor strength
and. 48
Patient capital, 74-75
Pepsico, 68
Percolator coffee maker industry, 12;
declining demand growth and, 38;
enduring niches of demand and, 36
Performance goals, shon-term, 142-143
Personnel services, use of mainframe
computers in, 106
Pet. 133
Petroleos de Venetuela. 21
Petroleum-exploration industry;
divestirure and, 14; competitor
behaviors and, 44
Petroleum-refining industry, 70;
holding investment level and, 21;
venical integration in, 142
Petromtd, 21
Pharmaceutical induSlry: cash
generator businesses and, 76;
shrinking selectively and, 26
Philco,
Ill,
112
Philip Morris, 68
Philips N.V., 113
Photocopier industry, 36
Pirelli, 18
Plankalkul, 110
PPG Industries, 12. 29
Pricing; holding investment level and,
22; increasing investment and, 18;
maximization of consumer welfare
and. 129-130; milking investment
and. 15 '
Printing, use of mainframe computers
in, 108
Procter
&
Gamble, 68, 76, 131
Product differentiation; competitor
strength and, 49; profitability
potential and, 41-42
Profitability potential, 31-51; assess­
ing competitor strengths and,
47-51; assessing endgame attrac­
tiveness and, 33-51; declining de­
mand growth and, 34-41; endgame
strategy matrix and, 31, 33; in­
dustry Structure and, 41-46
Proton Saga, 35
Public policy, 127-146; future dilem­
mas in, 142-146; maximization of
consumer welfare and, 128-133;
new perspectives on corporate
strategies and, 133-142
Public utilities, use of mainframe com­
puters in, 107
Publishing, use of mainframe com­
puters in, 108
PUE Nationwide, 67
Quality, operating flexibility and,
83-84
Q8,21
Ralsron Purina, 126
Raydac/Raycom, III
Rayon acetate industry, 12, 126;
declining demand growth and, 37;
divestiture and, 14; enduring niches
of demand and, 36; holding invest­
ment level and, 23; increasing in­
vestment and, 19; market share
and, 51
Rayon filament industry. holding in­
vestment level and, 23
Index. 165
Raytheon Corporation, 13, 14.29,
111
RCA Corporation, 51, 111, 112, 113
Receiving tube industry; declining de­
mand growth and, 34, 38;
divestiture and, 13, 14; enduring
niches of demand and, 36; exit bar­
riers and, 64; increasing investment
and, 19, 20; market share and, 51
Recession, 1-2
Red dye number 2, 14
Regal Ware, Inc., 12
Remington Rand Corporation, 111
Renault. 25
Resource allocation, 124-125;
allocative efficiency and. 124-125;
antitakcover laws and, 125
Restructurin~.
See
Industry
restructunng
Retailing; operating flexibility and, 87;
use of mainframe computers in, 107
Return, risk versus, 74-75
Rhone-Poulenc, 64
Risk, return versus, 74-75
Robins, A.H., 76
Rohm
&
Haas, 26
Rugenberger, 126
Safeway,87
Sales, slowing growth of, 3
Sandoz, 26
Saudi Arabia, crude oil industry and,
20.21
Scagrams, 126
Semiconductor industry, declining de­
mand growth and. 35-36
Service, operating flexibility and,
84-86
Seven-Up, 68
Shrink selectively strategy, 24-28;
acetylene industry and, 26; ap­
proach to, 24; asset deployment
and, 26; automobile industry and,
25; bulk chemical industry and,
27-28; COSt effectiveness and, 27;
hospitals and, 24; phannaceurical
industry and, 26; pricing and,
25-26; steel industry and, 27; tim­
ing of, 24-25, 27
Sick industries, 41
Sid Richardson Carbon
&
Gasoline
Company, 131-132
166 
Managing Maturing Businesses
Siemens A.G., 119
Single European Act,
126-127, 130,
132
SNIACE, 19
Societe Nationale Elf Aquitaine,
21, 64
Soda ash.
See
Synthetic soda-ash
industry
Soft drink industry, exit barriers in,
68
Software, for mainframe computers,
10'
South America: Brazilian economy
and,
131
n; bulk chemical industry
and,
39;
crude oil industry and,
20,21
South Korea: automobile industry and,
35;
bulk chemical industry and,
39;
construction machinery industry
and,
22;
textile industry in,
83
Southland Corp.,
21
Space-production industry, divestiture
and,
14
Spain: Crude oil industry and,
21;
stttl industry and,
60
Spencer Products,
15
Spcrry,
119-120
Sperry Gyroscope,
111
Sperry Rand,
Ill, 112, 113
Squibb,
76, 143
St. Kilby, Jack,
111
Standardization, cash generator
businesSfi and,
77-78
Stttl industry: canels in,
141;
customer traits and,
43;
declining
demand growth andf
36-37;
economic exit barriers and,
60;
operating flexibility and,
85-86;
shrinking selectively and.
27
Sterling Chemical,
64
Sterling Drug,
76
Stevens, J.p.,
19
Stihl,
84
Strategic exit barriers,
57-59
Strategic flexibility,
56, 79-92;
building strengths and,
81-82;
choosing endgame masters and,
88-89;
competitor-imelligence
system and,
80;
horizon forecasts
and,
80-81;
investing in human
assets and,
90;
logistics and,
82-83;
quality and,
83-84;
seeing
opponunities to create value and,
86-87;
service and,
84-86;
timing
and,
79-81;
turnaround artists
and,
90-91;
using assets effectively
and,
87-91
Strategy,
11-30;
ahernatives for,
12-
13; anticipating industry
maturity and,
125-127;
choosing,
28-29;
cooperation and canels
and,
140-141;
divest now,
13-14;
exit,
12-16;
holding investment
level as,
21-23;
increasing invest­
ment as,
17-21;
last iceman,
17-21,46;
milking invcstment as,
14-16;
public policy and,
133-
142;
resource allocation and.
124-125;
rising concentration and,
133,
140;
shrinking selectively as,
24--28;
survival,
16-28;
uncon­
trollable events and,
127;
venical
integration and,
141-142
Strategy matrix, for endgame,
31, 33
Substitutes, for mainframe computers,
101-108
Sumitomo Rubber Industries Ltd.,
18
Sunbeam Appliance,
29
Sun Company,
21
Supercomputers,
112
Supplier bchavior, profitability poten­
tial and,
43--44
Survival strategies,
16-28;
holding in­
vestment level as,
21-23;
increasing
investment level as,
17-21;
shrink­
ing selectively as,
24-28
Sweden, crude oil industry and,
21
Sylvania,
19,2(1,64
Synthetic fiber industry: endgame
manager and,
89.
See
auo
Rayon
acetate industry
Synthetic soda-ash industry,
12,
37-38;
declining demand growth
and,
37-38;
exit barriers and,
63
T ai!ored suit industry, operating flex­
ibility and,
83
Taiwan: automobile industry and,
35;
bulk chemical industry and,
39;
construction machinery industry
and,22
Tamoi! Italia,
21
Technical efficiency, maximization of
consumer welfare and,
128-129
T ethnology, computer, changing,
101-103
-
Technology leadership, cash generator
businesses and, 75-76
Tenneco Chemical, 26
Texaco,21
T e)(as Instruments, 111
Textile industry: competitor strength
and, 47; increasing investment and,
19; operating fle)(ibility and, 83
Thailand: automobile industry and,
35; bulk chemical industry and, 39
Theory, lack of, 6-7
Timing, 8; divestiture and, 13-14;
holding investment level and, 22,
23; increasing investment and,
20-21; milking investmentS and, 16
Tin can industry, operating flexibility
and, 85
Tire industry: enduring niches of de­
mand and, 36; holding investment
level and, 23; increasing investment
and,17-18
Toothpaste industry, divestiture and, 15
Toshiba. 13
Toyota, 25, 35
Transportation, use of mainframe
computers in, 107
Turing, A1an
M., 110
Turnaround artists, 90-91
Unfavorable industries, 45-46
Unilever,131
Union Electric, 19,64
Union Explosivos Rio Tinto, 21
Union Pacific, 21
Uniroyal Goodrich Tire, 18
United Auto Workers, 67
United States: bulk chemical induStry
and, 39; crude oil industry and,
21; CUStomers for mainframe corn·
puters and, 104; semiconductor in·
dustry and, 35-36; steel industry
and, 37, 43
U.S. Census Bureau, 111
United Steel Workers, 66-67
Index. 167
Vacuum tube industry.
See
Receiving
tube industry
Value creation, 144 n
Varity Corporation, 85
Veba A.G., 21
Vendor choice, maximization of con­
sumer welfare and, 130-133
Venezuela: bulk chemical industry
and, 39; crude oil industry and,
20,21
Venture capitalists, 14
Vertical integration, 141-142; as exit
harrier, 58-59, 67-68; selective,
19-20
Vista Chemical, 64
Watson, Thomas, Sr., 110
Weinon Steel, 66-67
West Germany: bulk chemical industry
and, 64; computer industry and,
110, 119; crude oil industry and,
21; food·processing industry
and,
126; steel industry and, 60;
technical efficiency and, 128
Westinghouse Electric, 19
Wheeling-PittSburgh Steel, 67
Whiskey industry: declining demand
growth
and, 39; divestiture and,
!4
Wholesaling industry, operating flex-
ibility and, 83
Winning firms, 7
Work force, changing, 144
Wyeth laboratories, 43
Yarn industry, operating flexibility
and, 85
Yugo,35
Yugoslavia, automobile industry and,
35
ZI, 110
Zuse, 119
Zuse, Konrad, ItO