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Husky Injection Molding Systems- Group 7

Huskys Strategy
Huskys strategy can be identified based on classification according to the target market and
customer value. The analysis is based on the business to business markets. Their strategy falls under
Focussed differentiation due to following reasons:
1. Distinctiveness(Differentiation Strategy):
Husky machines were of the highest quality in the industry and they provided complete
factory solutions to the customers. As per the VRIO framework both are valuable, rare,
difficult to imitate and fully exploited by the organization. Their systems were known for
speed, ruggedness, resin utilization, durability and automation. This advantage in the
competitive dynamics leads to slow cycle market in which the competitive advantage is
shielded from imitation and the advantages last longer.
2. Narrow market segment(Focussed Strategy):
The company particularly focussed on medium tonnage PET pre-form and thin wall
applications and was able to establish itself as the leading firm in the pre-form and thin wall
niche. By 1995, 60% of the pre-forms were manufactured using the Husky injection
moulding systems. This advantage was moderately difficult to imitate since many
companies had already entered the market. In competitive dynamics, it leads to a standard
cycle markets where Husky has to continuously upgrade its capabilities for sustainable
competitive advantage.
The company has been able to sustain their competitive advantage despite of high price. This can be
understood from the following calculations(Refer to attached excel sheet)
Husky Competitor
Exhibit
6
Preforms per cycle 48 48
Cycle time (seconds) 10.4 11.8
Average operating hours per day 22.3 18.9
No. of preforms produced per day 370523 276773
Average weight of preform 24.39 24.42
total preform produced (Kg)per day 9037.06 6758.79
electricity savings per day (KWh) (0.137 KWh/kg
preform produced) 1238.08
Cost saving in a year from electricity ($) (0.08 $/KWh) 36152
Exhibit
3
Resin cost as % of total cost 58%
scrap cost as % of total cost 2%
Scrap cost as % of resin cost 3.45%
Exhibit
11 Resin cost in 1995 ($/Kg) 1.65

Cost saving from 1% reduced wastage ($/kg) 0.056896552
cost savings in a year from 1% reduced wastage ($) 187675
Total cost saving (electricity+reduced wastage) ($/year) 223827

Total cost saving (million $/year) 0.223827
Approxiamte purchase price (million $) 1.2 1


Husky Injection Molding Systems- Group 7
From the above calculations, it is evident that cost savings only from electricity and pre-form
wastage reduction is $0.22 Million while the premium charged by the company is $0.2
Million. So, direct savings are sufficient to cover the premium charged within one year.
Additional benefits (higher output) due to low cycle time provide the processors to meet the
demand in the peak scenarios.
The companys strong values as well as their ability to bring new innovations in technologies
through R&D have helped them sustain their competitive advantages over others.
Their strong service force and sales team helped maintain strong customer service and good
relations with the customers

Group Members-
Himanshu Mittal(020)
Dipti Jha(017)
Shruti Mandal(050)
Raghu Vamsi(035)
Priyanka Chauhan(032)