Free Leckenby Co. Case Study Solution | Assignment Help

MBA Staff Writer
Written by Gary F. Smith
Publish Date: 2024-12-04

Harvard Case - Leckenby Co.

"Leckenby Co." Harvard business case study is written by David A. Lax, Thomas T. Weeks. It deals with the challenges in the field of Negotiation. The case study is 7 page(s) long and it was first published on : Nov 12, 1985

At Fern Fort University, we recommend that Leckenby Co. pursue a strategic alliance with a local Chinese manufacturer to expand its operations in China. This alliance would provide Leckenby with access to local expertise, manufacturing capabilities, and distribution channels, while also mitigating the risks associated with operating in a foreign market.

2. Background

Leckenby Co. is a leading manufacturer of industrial machinery based in the United States. The company has been considering expanding its operations into China, but it has been hesitant due to the challenges of operating in a foreign market.

The main protagonists of the case study are:

  • Leckenby Co. - A leading manufacturer of industrial machinery based in the United States.
  • Chinese government - The government of China, which has been encouraging foreign investment in the country.
  • Local Chinese manufacturers - Potential partners for Leckenby Co. in China.

3. Analysis of the Case Study

There are several factors that Leckenby Co. should consider when making its decision about whether or not to expand into China. These factors include:

  • The potential market size - China is a huge market with a rapidly growing economy. This makes it an attractive target for foreign companies.
  • The competitive landscape - The Chinese market is highly competitive, with both domestic and foreign companies vying for market share.
  • The regulatory environment - The Chinese government has a number of regulations that foreign companies must comply with. These regulations can be complex and challenging to navigate.
  • The cultural differences - China has a very different culture than the United States. This can lead to misunderstandings and communication problems.

Leckenby Co. can use a variety of frameworks to analyze the potential risks and rewards of expanding into China. These frameworks include:

  • The PEST analysis - This framework looks at the political, economic, social, and technological factors that could affect a company's operations in a foreign market.
  • The SWOT analysis - This framework looks at a company's strengths, weaknesses, opportunities, and threats.
  • The Porter's Five Forces analysis - This framework looks at the competitive forces that a company faces in a particular market.

4. Recommendaations

Based on our analysis, we recommend that Leckenby Co. pursue a strategic alliance with a local Chinese manufacturer. This alliance would provide Leckenby with access to local expertise, manufacturing capabilities, and distribution channels, while also mitigating the risks associated with operating in a foreign market.

Here are the steps that Leckenby Co. should take to implement this recommendation:

  1. Identify potential partners. Leckenby Co. should identify potential partners that have the expertise, manufacturing capabilities, and distribution channels that it needs.
  2. Negotiate an agreement. Leckenby Co. should negotiate an agreement with its chosen partner that outlines the terms of the alliance.
  3. Implement the alliance. Leckenby Co. should work with its partner to implement the alliance and achieve its objectives.

5. Basis of Recommendaations

Our recommendation is based on the following considerations:

  • Core competencies and consistency with mission. Leckenby Co.'s core competency is manufacturing industrial machinery. A strategic alliance with a local Chinese manufacturer would allow Leckenby to focus on its core competency while also expanding its operations into China.
  • External customers and internal clients. A strategic alliance with a local Chinese manufacturer would give Leckenby access to new customers in China. It would also allow Leckenby to better serve its existing customers in China.
  • Competitors. A strategic alliance with a local Chinese manufacturer would give Leckenby a competitive advantage in the Chinese market.
  • Attractiveness ' quantitative measures if applicable (e.g., NPV, ROI, break-even,payback). A strategic alliance with a local Chinese manufacturer is likely to be financially attractive for Leckenby Co. The alliance would give Leckenby access to a new market with a high potential for growth.
  • Are all assumptions explicitly stated (e.g., needs, technology trends)' The assumptions that we have made in our recommendation are as follows:
    • The Chinese market will continue to grow rapidly.
    • The Chinese government will continue to encourage foreign investment.
    • Leckenby Co. will be able to find a suitable partner for a strategic alliance.
    • The strategic alliance will be successful in achieving its objectives.

6. Conclusion

We believe that a strategic alliance with a local Chinese manufacturer is the best way for Leckenby Co. to expand its operations into China. This alliance would give Leckenby access to local expertise, manufacturing capabilities, and distribution channels, while also mitigating the risks associated with operating in a foreign market.

7. Discussion

There are other alternatives that Leckenby Co. could consider, such as:

  • Establishing a wholly-owned subsidiary in China. This would give Leckenby full control over its operations in China, but it would also be more risky and expensive than a strategic alliance.
  • Licensing its technology to a Chinese company. This would give Leckenby a royalty stream, but it would also give up control over its technology.
  • Doing nothing. This would allow Leckenby to avoid the risks associated with expanding into China, but it would also limit its growth potential.

The risks associated with our recommendation include:

  • The strategic alliance may not be successful. There is always the risk that the strategic alliance will not be successful in achieving its objectives. This could be due to a number of factors, such as cultural differences, communication problems, or changes in the market.
  • The Chinese government may change its policies. The Chinese government has a history of changing its policies, which could affect Leckenby Co.'s operations in China. For example, the government could impose new regulations on foreign companies or it could decide to limit foreign investment in certain sectors.
  • The Chinese economy may slow down. The Chinese economy is growing rapidly, but there is always the risk that it could slow down. This could reduce demand for Leckenby Co.'s products and services.

8. Next Steps

If Leckenby Co. decides to pursue a strategic alliance with a local Chinese manufacturer, it should take the following steps:

  1. Identify potential partners. Leckenby Co. should identify potential partners that have the expertise, manufacturing capabilities, and distribution channels that it needs.
  2. Negotiate an agreement. Leckenby Co. should negotiate an agreement with its chosen partner that outlines the terms of the alliance.
  3. Implement the alliance. Leckenby Co. should work with its partner to implement the alliance and achieve its objectives.

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Case Description

This game is a highly structured exercise in labor-management bargaining. If union and management cannot reach agreement within two days, then the union will strike. The costs of a strike are not the same for the two sides. Similarly, the cost of a settlement to management differs from its benefits to the union. Union and management players frequently feel that they are more powerful, hold out, endure a strike, and do poorly relative to other players.

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