Faber Castell the Future of the Pencil - Coursework Example

Faber Castell the future of the pencil of Number: Paper: Faber Castell the future of pencil a) Core Competencies of Faber Castell Count Anton Wolfgang, the head of Faber Castell, had thrown 144 pencils from top of the castle in Germany only to prove that these pencils are unbreakable even from that great a height (“The Future of the Pencil”). So, it can be stated that unbreakable nature of the pencils manufactured by Faber is one of its core competency. Children prefer purchasing those pencils, which are uniquely designed and have different colours. These colours consist of harmful chemicals, causing parents to worry. In order to give assurance to these parents, Faber invented colours for the pencils, which do not contain any harmful chemical. This relieved parents about the fact that their Children will not swallow any toxin while chewing pencils, besides increasing sales of the company. This can definitely be listed as one of the core competencies of Faber. In 1875, Faber had first invented the concept of manufacturing pencils with erasers on the back. However, currently, the concept is imitated by most of the pencil manufacturers (“The Future of the Pencil”). Despite tendency to imitate, Faber remains the master of inventing unique features in a pencil, which adds to core competencies of the company. Thirdly, the company has added rubbery dots to the pencils so that the grip is maintained regardless of sweaty hands. This also constitutes core competencies of the company, which have helped to distinguish its products from others and remain the market leader even at times of recession. Core competencies of a company can be defined as main strengths, which help to distinguish its skills from others in the competitive market (Meredith and Shafer 32-34). These not only help in developing a considerable market, but also assist in integrating modern technology for development of new products and services. The advanced technologies facilitate increase in speed of manufacturing products and reduce unproductive time of the company. The reduction of ineffective hours helps the company to produce more products by employing modern technology. Hence, core competency can be referred as key capabilities of a company, which supports it to become successful in the market as well as stay ahead from competitors. The core competencies of company are developed in accordance with type of products so that it becomes the main feature for promotion. It is important for a company to devise portfolio of core competencies, rather than producing products that are unable to add any value to image of the company. The managers are responsible for identifying and developing this competency so that it represents strength of the company in long run. This reflects processes and practices followed by a company, which helps to build a strong base in the competitive world (Meredith and Shafer 32-34). Core competencies actually highlight collective learning of a company and also consider coordination of various production skills. These also reflect integration of a number of technologies (Drejer 26). One of the main characteristics of core competency is that it is not fixed for a particular company. It changes with time and that in external environment. The core competencies of a company are developed according to current situation of the industry; so, drastic changes in external world affect core competencies to a great extent. Therefore, it can be stated that Faber Castell constantly tries to modify or change the core competencies with time. In this manner, gets adapted to the new circumstances and in some cases, changes transform into an opportunity for the company (Newman 56; “Facts and Figures”). Core competencies help a company to get access to wider market, besides supporting development of a number of products or services, which are relevant to taste and preference of the mass. It also makes an important offering to customers to enjoy benefits of the products. So, the company sets it core competencies according to tastes and needs of market. The characteristics of core competencies highlight the fact that these cannot be imitated and in some industries, they are unique (Meredith and Shafer 47). The core competencies of Faber Castell help to meet varying needs of customers around the world. In current digital age, use of pencil has declined to a great extent, which has slowed down sales of pencils worldwide. However, it is observed that sales of Faber Castell pencil have not slumped drastically. The sale of pencil worldwide amounted to 15-20 billion in 2010, of which 2 billion was manufactured by Faber Castell (“The Future of the Pencil”). It indicates the fact that in spite of digitalization, sales of the company are not affected. Parents rely on the brand and feel relieved that their Children are using pencils, which are not harmful for their health; as Faber Castell coat the pencils with colours that do not contain any toxic material. The reason behind steady performance of Faber can be attributed to the core competencies. The core competencies have become main strength of company, which has assisted in drawing increased sales around the world. The core capabilities of Faber Castell not only stress upon company capabilities, but also identify key features of products, which act as a competitive advantage of the company (“Brand Essentials”). b. Strategies Faber Castell is regarded as the largest pencil manufacturer in the world. For the last 20 years, since the beginning of the digital era, Faber Castell through its unbeatable strategies has maintained its sales and even concentrated upon inventing new series of pencils, which effectively contribute towards increasing sales as a whole. The strategies undertaken are very helpful in order to survive in long run as Faber Castell has maintained product sales, even with presence of high number of competitors in the market (“Faber-Castell Pencil Is Far Mightier than the Sword”). The diagram below highlights the strategies which have helped the company to remain competitive in the market: Figure 1: Strategy (Source: Meredith and Shafer 31) Visions and mission statement The mission of Faber Castell is to satisfy their customers with affordable pencils of high quality and cater to needs of the customers. The vision of the company is to maintain its position in the industry by maintaining quality in the long run as well as constantly innovating new products in the near future (“About Us”). Business strategy The company has nullified competition by utilizing its wining competencies and most specifically, with quality. The company provides these pencils to customers at a cheap price, which last for long even after repeated sharpening (“About Us”). The lower price does not affect quality of products offered by the company; this can be accounted to the company belief that with larger number of customers buying their products, motivation to invent new products is enhanced. The quality and benefits that are provided by Faber Castell are majorly absent in products offered by other pencil manufacturers (“Faber-Castell Pencil Is Far Mightier than the Sword”). It is observed that one of the core competencies of Faber Castell has been imitated by other manufacturers and that is addition of rubber on the pencil. This strategy has proved successful for other companies too, but the initial success was experienced by Faber Castell as the inventor. Another innovation of the company is to make pencils with ergonomic triangular shape. This type of pencils is preferred by children owing the comfortable grip and good handwriting quality that is facilitated. The company aims at targeting a number of segments in the society. The first segment is that of Children who use pencils in school and at home. This type of target customer is very sensitive in nature, in case they do not like pattern or design of a pencil, they do not hesitate to reject it and this in a way de-motivates their parents towards buying the same. Hence, this segment of customers is to be dealt with very cautiously. The second customer segment comprises aristocrats who like to use luxury pencils for documenting information. This segment does not worry about price of the pencil, but desires for elegance and comfort (“Faber-Castell Pencil Is Far Mightier than the Sword”). Business Model The type of mass customization strategy that is used by Faber Castell is collaborative customizers. Faber Castell seeks information on the market and carries out survey to know exact needs of the customers. After understanding the exact requirements of customers who are majorly the parents and Children, Faber Castell develops customized outputs. As a result, children get a variety of differently collared pencils, which satisfy their desires and instil comfort in the act of writing. The triangular shape of the pencil makes their grip strong and enhances overall ease so that speed of writing and handwriting quality are improved. After considering exact needs of children, Faber Castell designs and manufactures customized pencils for them. The external forces that have often disrupted the operation of Faber Castell are environmental issues and competition from the local companies. The internal forces that help the company to expand its business are core competencies and culture. Issues and Challenges encountered by Faber Castel in Digital Era In the current digital era, sales of Faber Castell are noticed to have declined to a considerable level as individuals have started to use computers for gathering information. However, it has been observed that children do not a choice but to use pencils at schools and home. So, it can be inferred that sales from the second segment declined to a considerable level and not that from the first one. Faber Castell also encountered recession wisely, by way of lowering price of the pencils in order to enable poorer sections of countries afford their brand as they tend to purchase cheap local brands (“Faber-Castell Pencil Is Far Mightier than the Sword”). In order to target second segment of the market, Faber Castell has devised luxury pencils in the present age of computer technology so as to retain customers who would choose to use pencils for documenting important information. The company marketed a set of five black-lead pencils, which had silver plated tips in order to avoid breakage. Though the pencil was sold at a high price, yet it had garnered sufficient popularity in Europe as the Europeans considered luxury items as their symbol of status (“Pencil Pushers prevail in age of PC”; Faber-Castell Introduces Some of the Worlds Swankiest Pens”). Despite huge challenges like, digitalization and recession, the company has maintained its image and income by satisfying and exceeding needs and expectations of customers. Therefore, it can be inferred that Faber Castell has the capability to maintain an unbeatable position in the industry. Works Cited “About Us.” Faber Castell. Faber Castell, 2014. Web. 21 May 2014. “Brand Essentials.” Faber Castell. Faber Castell, 2014. Web. 21 May 2014. Drejer, Anders. Strategic management and core competencies: Theory and application. Westport: Quorom Books. 2002. Print. “Faber-Castell Introduces Some Of The Worlds Swankiest Pens.” Forbes. Forbes.com LLC, 2014. Web. 21 May 2014. “Faber-Castell Pencil Is Far Mightier than the Sword.” Mail online. Associated Newspapers Ltd, 2014. Web. 21 May 2012. “Facts and Figures.” Faber Castell. Faber Castell, 2014. Web. 21 May 2014. Meredith, Jack and Scott, Shafer. Operations management. New York: John Wiley & Sons. 2009. Print. Newman, Cory. Core competencies in cognitive-behavioural therapy. London: Routledge. 2013. Print. “Pencil Pushers prevail in age of PC.” Sunday News. Sunday News, 2000. Web. 21 May 2014. “The Future of the Pencil.” The Economist. The Economist Newspaper Limited, 2014. Web. 21 May 2014. Read More