The first stakeholders that Vantage should be concerned with are its customers. As with any company they must be serviced to a degree that will ensure return business and great confidence.
In the industry that VHEL services the majority of customers are contractors. The implications for this are quite clear. When a contractor is on a job they are under rigid deadlines. This means that Vantage must deliver a service that is both reliable and timely.If they do not do this they will come under severe scrutiny because an intangible fact about the construction industry is that it is very stressful and word spreads quickly when a company is not reliable.
Furthermore, the contractors are likely to be well versed in the ins and outs of renting mobile cranes, it is therefore vital to VHEL survival to focus on customers concerns, wants and needs. The second group of stakeholders are the employees. At the moment they are somewhat disgruntled. This primarily stems from the instability of the company’s structure and having to undergo structure reform twice in the last six years.This is a major issue for Vantage. Not only will any internal dispute cause some malcontent, disharmony during a time where there is going to be a change of leadership could prove very destructive. The effects will include hindering performance and efficiency.
The third group of stakeholders is the shareholders. The only reference that we have concerning shareholders is that Harvey himself is the major holder. It seems likely that a company of Vantage’s size could engage in an employee ownership program. As is stated no bonuses were pain last year.In an attempt to heal the wounds from this blow the company could offer share bonuses that are non-refundable for a period of time that will allow the company to get back to efficiency. This will not only give the disgruntled employees some sort of severance it will also get them working for the good of the company again.
If an employee realises that they will benefit from the company’s success they will be more inclined to work hard for the firm and improve its situation and consequently their individual financial position.Target Customer-Industry Based Connections The main customer-industry based connection that involves Vantage’s product is mobile cranes – contracting/construction industry. As has been stated previously the main concern of VHEL customer base is reliability and timeliness of service because down time due to equipment can mean the difference between profit and loss. Skye Crane offers a product that is extremely reliable.
This has Vantage operating at 25% of a price advantage over its competitors in the medium sized crane distinction.In the heavy crane class they have a 15% advantage over Skye Crane. Instead of trying to compete by offering the same sort of service and reliability as Skye Crane, Vantage are trying to compete on a price level. They cut costs and used backward integration in order to compete on this level.
This is a massive error on Vantage’s part. It is far more likely, given the constraints of the customers industry, that people would pay the extra percentage in price in order to receive better after purchase service and reliability.Market-Tecnology Business Connections From the limited material that we have concerning the technology prevalent in the industry Vantage seem to do quite well.
They were the first company to offer a crane that uses smooth hydraulics. Furthermore, they offer a 60-day guaranteed delivery and maintain that they can tailor each crane to the specific needs of the customer. However, it should be stated that at the Olympia plant dated equipment is dated. The maintenance off such old equipment is an additional cost that the company should not be incurring.These costs have a punitive effect on the cost cutting measures that Vantage is trying to establish. Market Share Vantage currently has an approximate market share of 16%. VHEL are the second biggest company of their kind in the world, Sky Crane is the largest with a 50% share of the market.
The market is a global one; that is worth an estimated $630 million per year. The United States account for 38% of the global business in this industry, the rest of the world accounts for 55% while Canada can only account for 7% of the total market.VHEL are obviously facing a significant challenge even if they do employ the right person to take over as president and they sort out their financial problems. Skye Crane enjoys a huge market share and has the respect of the industry. Market and Technology Life Cycles From the information that we have it seems that the industry is in a mature stage and is set to enter the decline stage in the future.
Although they are far from the size of Skye Crane Vantage is still a major player in the industry.Through this position they must establish better reliability, market themselves towards this and bring their costs under control. They recently tried to develop a new type of crane however this did not have the expected demand. Instead of trying to gain market share through the introduction of new products they should establish good logistical systems and reliability. Once the apparent cracks in these things have been fixed and the industry has a confidence in the company they will find it easier to launch new products.Furthermore, with an expected decline in the industry the company should be solidifying its position and looking to increase market share through the (cheaper) implementation of good service procedures as opposed to the expensive launching of new products and cost cutting.
By focusing in the right areas the company can establish itself at any point where the market leader may slip up. When this opportunity arises they must move swiftly and decisively. Only through commitment to good techniques can this be achieved.