Videocon's Reinventing Strategies: Can it sustain the Replication of LGs Success?



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Code : COM0264

Year :
2013

Industry : Consumer Electronics

Region : India

Teaching Note:Not Available

Structured Assignment :Not Available

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Introduction:In August 2012, Videocon Industries Limited (Videocon) , one of India's largest consumer electronics makers, hired a few former LG Electronics India Pvt. Ltd. (LG) executives with the aim of becoming the largest electronics manufacturer in India.

Videocon, which had been the leading consumer electronics and home appliance manufacturer in the 1990s in India, had been continuously losing market share since 2000. Regaining its lost market share was a major challenge for Videocon. In mid 2008, Kwang Ro Kim (Kim), former managing director of LG, joined Videocon as the vice-chairman and CEO of the company. The leadership change was aimed at exploring domestic and global markets for new growth opportunities and consolidating Videocon's position. Kim, who steered LG to become the market leader in India, was expected to develop a new vision for Videocon. And true to expectations, Kim chalked out detailed restructuring strategies for Videocon based on the strategies he had implemented at LG. These resulted in initial success. However, Kim quit in 2010 due to a clash with the Videocon management; also his contract with the company ended. The restructuring plan was aimed at pushing Videocon to the No.1 position in the Indian consumer market, overtaking leading rivals LG and Samsung. So, after Kim's exit, Videocon recruited few other former LG executives to continue the momentum needed to reach the top position. But experts were skeptical about Videocon's ability to become No.1 in the industry and whether it would be able to replicate LG's success.

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