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Axeon case study Group D3: Catherine Levine, Xiaoli Huo, Xin Yu, Radu Popescu and Tore Kot Winge.

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Presentation on theme: "Axeon case study Group D3: Catherine Levine, Xiaoli Huo, Xin Yu, Radu Popescu and Tore Kot Winge."— Presentation transcript:

1 Axeon case study Group D3: Catherine Levine, Xiaoli Huo, Xin Yu, Radu Popescu and Tore Kot Winge

2 Q1. What do you feel about the initial analysis? Was there, in your opinion, anything wrong with it? The project was not anchored in real time No risk analyses or contingency plans No buffers in time and budget No market analyses (competitors/ customers) No fixed costs

3 Q2. Is construction of the new factory in the UK in the best interest of Axeon? It is not in the best interest of Axeon because: Too optimistic figures were advanced by Ian It is only in the interest of the UK subsidiary Building a new production facility in more or less same geographic area / (at same point in time could mean same market area) Much better to increase production in the nearby Dutch facility (lower production costs, higher cut loses)

4 Q3. Why did Mr van Leuven behave as he did? Enthusiastic - The project mirrored the company’s decentralized management approach Doubts - Valid concerns about the project - Project not supported by the main company employees - Fear of losing the countrymen’s support

5 Q4. Discuss what transfer price should be established if AR-42 is supplied from the Netherlands to the UK. The transfer price should not follow Axeon’s usual practice of pricing It would be fair to use a negotiated transfer price Dutch company were to make and export the product UK company were to take care of the product marketing They should have a transfer price of around £3000 per ton

6 Q5. What is Axeon's corporate strategy? They have acquired other companies, in order to be present in those markets, with the products of the acquired subsidiaries The company intends to establish itself on a multinational level

7 Q6. What do you believe to be the critical success factors in Axeon? High market share In-house technology Manufacturing very large quantities of chemicals

8 Q7. What do you believe are the key recurring activities in Axeon? Mass manufacturing Sales Pricing

9 Q8. Discuss Axeon in terms of its centralisation / decentralisation. Initially based on a simple functional organizational structure (manufacturing and sales) After acquirements - highly decentralized organisation style large responsibility for the subsidiaries and gave them considerable autonomy Case study shows that there were still parts of the decision making that were highly centralized within Axeon`s organization in the Netherlands

10 Q9. What should Mr. van Leuven do? Restructure their management control tools in order to have a structured decision making process Maintain the results control with emphasis on the company profits, but improve the Culture Control He should emphasize the interdependence of the company and its members, and the benefits of camaraderie Common market strategy


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