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Running head: Canon: Competing on Capabilities
Case 3-4: Canon: Competing on Capabilities
Dan Petillo
Strategies In A Global Environment
(Section 2)
MBA-C695
Regis University
Introduction and Background
In the wake of Xerox’s growing dominance in the plain paper copier (PPC) market (Gomes & McQuade, 1991), Canon’s camera company decided to enter into the PPC business in the late 1960s to further its growth through diversification. Despite predictions that no company could effectively challenge Xerox’s monopoly due to their numerous patents, Canon spent the next two decades redefining the copier business to emerge as the second largest global competitor in terms of sales and surpassing Xerox in the number of units sold (Ackehusen, 1992).
Canon’s strategic foundation, initially in the copier business, consisted of a synergistic management initiative that brought the full technological capability and know-how in fine optics, precision mechanics, electronics, and fine chemicals to bear on the copier business.
Canon’s Core Competencies (Ackehusen, 1992):
q Fine optics - basic camera, laser images;
q Precision mechanics – basic camera, fax, bubble jet printer, laser images;
q Microelectronics – advanced cameras, fax, bubble jet printer, laser images;
q Low cost quality manufacturing – organizes the manufacturing process to expend the minimum amount of required time, energy, and resources;
q Marketing expertise – calculated introduction strategies; perfected in home market before introducing internationally;
q Innovation savvy – due largely to a carefully orchestrated use of technology and the capacity for managing rapid technological change.
Canon’s Strategy v. ... Xerox’s entry barriers consisted of:
q Wide range of copiers
q Direct sales force
q National service network
q Leased
q Targeted heads of duplicating departments
Canon’s strategy was to minimize risk by introducing a new product through known channels, first.
Approximate Word count = 1343
Approximate Pages = 5.4
(250 words per page double spaced)
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