Maytag

Example of Student-Written Strategic Audit For the 1993 Maytag Corporation Case I. CURRENT SITUATION A. Current Performance.

Poor financials, high debt load, first losses since 1920s, price/earnings ratio negative.

B. Strategic Posture 1. Mission ?h Developed in 1989 for the Maytag Company: ¡§To provide our customers with products of unsurpassed performance that last longer, need fewer repairs, and are produced at the lowest possible cost.¡¨ ?h Updated in 1991: ¡§Our collective mission is world class quality.¡¨ Expands Maytag¡¦s belief in product quality to all aspects of operations.

2. Objectives ?h "To be profitability leader in industry for every product line Maytag manufactures." Selected profitability rather than market share.

?h "To be number one in total customer satisfaction" ?h "Grow the North American appliance business and become the third largest appliance manufacturer (in unit sales) in North America." ?h Increase profitable market share growth in North American appliance and floor care business, 6.5%

Hoover Dam Bypass

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Antique Maytag washing machine.

return on sales, 10% return on assets, 20% return on equity, beat competition in satisfying customers, dealer, builder and endorser, move into third place in total units shipped per year.

3. Strategies ?h Global growth through acquisition, and alliance with Bosch Siemens.

?h Differentiate brand names for competitive advantage.

?h Create synergy between companies, product improvement, investment in plant and equipment.

4. Policies ?h Cost reduction is secondary to high quality.

?h Promotion from within.

?h Slow, but sure R&D: Maytag slow to respond to changes in market.

II. STRATEGIC MANAGERS A. Board of Directors 1. Fourteen members - 11 are outsiders.

2. Well-respected Americans, most on board since 1986 or earlier.

3. No international or marketing backgrounds.

4. Time for a change? B. Top Management.

1. Top management promoted from within Maytag Company 2. Very experienced in the industry 3. Responsible for current situation 4. May...