Steinway & Sons

Group3 ASPEN:

Part I: Whats it ?
In an age of mass production, Steinway & Sons remains a testament to individual craftsmanship, each year producing a limited number of handmade pianos, considered by many to be the finest in the world. Mission set the standard for excellence in Piano manufacture.

Legend of S&S imperishable

The Early Years 1839. won first honor 1850. set sail to New York 1853. Steinway & Sons 1855. entered AIE; won a gold medal 1866. open Steinway Hall 1867. extend reputation and sales abroad 1871. Heinrich died 1870s. Open a huge factory 1875. London showroom 1880. a factory in Hamburg End of the 19th century, on the verge of bankruptcy 1896. William died. His nephew try to sell it.

Legend of S&S imperishable

20th Century Changes 1930s. Lost part of market World War II. Halted for military After the war. Consolidate\ Renew \ Sell Steinway Hall 1960s. High variety but low profits 1972. sold to CBS 1985. sold to Boston group 1995. sold to Selmer co. 1998. acquired kluge 1999.purchase O.S. Kelly; repurchase Steinway Hall 2003 net sale $180 million.

Tradition of Superior Quality

Customers Loyal Customers- 95 % exclusively on Steinway pianos; listed more than 900 Steinway Artists unique piano bank, Production Quality handcraftsmanship and innovative techniques were part of the tradition 120 patented during its first 40 years, becoming the basis for the so-called Steinway system, the eventual standard for piano manufacture

Tradition of Superior Quality

did not relax this quest for excellence-1920s, Steinway modified its manufacturing process, improving its rib shaping process and veneer techniques By the end of the 1930s, Steinway stopped producing iron plates and ivory keys, choosing instead to replaced ivory keys with a polymeric material, successfully reducing costs without reducing quality.

Creating a Steinway
Meticulous craftsmanship and attention to detail could not always keep pace with the demand for its grand pianos Raw material searched the globe for the worlds finest wood; each Steinway piano used wood from a single tree. toughest customer for wood suppliers, nearly 50% of wood ended up in the scrap bin.

The Competition
Baldwin. the largest American piano builder, Yamaha. Japan had become the largest pianoproducing nation (1/3 of the worlds output). New Products for a New Era of Distribution introduced a third line of pianos, rebuilt pianos under the brand Heirloom Collection. change within Steinways distribution

Part II: SWOT

Opportunities

Weakness Strength

10

Threats

Business School of Shantou University

Strength
      

Brand Quality Strategy Innovative technique Market leader in high quality piano Good service Vertical Integration and Strategy alliance

11

Business School of Shantou University

Weakness
    

High cost Slow production speed Narrow market niche Outdate technology Operation process

Opportunities


  

New production technology Middle market Globalization Increasing demand

Threats
  

Competitors low price competence Production technology revolution Cut the cost in the case of ensure quality

Part III: Recommendations

Based on SWOT analysis.

Internal issues External issues

strength
Brand; Quality; Strategy; Innovative technique; Market leader in high quality piano; Good service; Vertical Integration and Strategy alliance

weakness
High cost; Slow production speed; Narrow market niche; Outdate technology; Operation process.

opportunities
New production technology ; Middle market; Globalization; Increasing demand.

SO
using new technology to improving quantity; enter into the middle market with brand and quality advantages...

WO
Low down the cost and cut down the cycle-time via using new production technology to meet the increasing demand; assembly line is recommended

threats
Competitors low price ;competence Production technology revolution; Cut the cost in the case of ensure quality.

ST
Give up the low class products, focusing on both the high and middle class; the great brand is the core competence to fight back

WT
Put money on the point update the technology; project shop just for the famous musician and assembly line should be adopted

SO
using new technology to improving quantity; enter into the middle market with brand and quality advantages...

WO
Low down the cost and cut down the cycle-time via using new production technology to meet the increasing demand; assembly line is recommended

ST
Give up the low class products, focusing on both the high and middle class; the great brand is the core competence to fight back

WT
Put money on the point update the technology; project shop just for the famous musician and assembly line should be adopted

Quantitative analysis
 

-- helping decide to choose which process. Sample 1: mill slot then drill hole

Quantitative analysis


Sample 2: drill hole then mill slot.

Quantitative analysis


Describing statistics

Quantitative analysis
 Conclusion

-- we would suggest Ronald Penatzer ( General Manager of Manufacturing Operations) choose the second process.

The end

Thank you For your attention!