Introduction
New Balance is now considered as one of the largest shoe manufactures in the world along with Nike and Adidas. This company was established at the beginning of the twentieth century, namely in 1906, but for a considerable period of time, it could not strengthen its positions in the market and the production was mostly small-scaled, the real breakthrough came in the early eighties when they designed a drastically new shoe model, called Trackster, its major peculiarity was ripple sole.
This success of this enterprise can be attributed to several reasons: first, uniqueness of this product and its popularity among buyers. Secondly, we should not overlook the management approach to customers and marketing: first the management of the firm has always been very attentive to the individual needs of their clients and in part this boosted the growth of this enterprise.
There are various rather impressive aspects of New Balance. First, it should be pointed out that during the course of its development, this firm never spent large amounts of money on advertising. Its products became well-known throughout the United States mostly due to the positive feedbacks of the customers. This feature distinguishes New Balance among other shoe manufactures. Furthermore, at the moment, the firm is arguably the only representative this industry, which does not off shore US- based jobs.
Naturally, the company has many subsidiaries in Europe and Asia, but these plants constitute only the smaller part of the production. Apart from that, the major principle of this enterprise is to focus on functionality of their shoes but not on their fashion. Certainly, each buyer is primarily concerned with comfort, when he or she buys shoes, but the design of the product is no less important. Perhaps, this prevents the firm becoming even more efficient.
Strategy
There are five strategies, which enable to achieve competitive advantage over other firms; the management may choose one of these aspects: cost of the product, image, quality, and timing (Thompson et al, 2004). As regards New Balance, it is rather difficult to determine which competitive strategy this firm chose. This company has several priorities among them we may distinguish the quality and constant innovation of the shoe models. In order to substantiate this statement, we should refer to some examples: first, while designing any shoe model, the developers never disregard the opinion of their clients, who may detect some drawbacks or might propose some invaluable suggestions. However, its policies are not conservative; the management supports every initiative, made by average employee.
Management
New Balances management has done several thing while pursuing this policy. First, despite the growing globalization, this company still manufactures its products in the United States, and their approach is quite understandable. They argue that off shoring may surely reduce operating expenses for some period of time but in the long run it will have detrimental effects on the quality. First, they emphasize the role of highly-skilled labor force, which practically ensures customers satisfaction, and this is the goal, which every manufacture must achieve in order to survive. New balance also has a very effective customer support service, which can be accessed either by phone or online.
At this center, potential clients can receive recommendations of the most appropriate shoe model. New Balance spares no expenses on research and innovation, for example, the developers consult scientific findings concerning breathable microfibers or water-resistant linen. The main objective is to make shoes as comfortable as possible. This brings NB to the forefront of this industry.
Culture
However, the popularity of NB can also be explained by the culture of this organization. It comprises several elements such as attitude toward its clients and employees. First, the management sets stress on the fact that each customer is unique therefore; the product itself must be adjusted to his or her needs, for instance by fitting the size and shape of shoe, bra and so forth. Secondly, the customer support center gives helpful tips how to wear them, in order to avoid any discomfort or pain.
This is extremely useful for people who might experience health problems, or those who are recovering from injuries especially such assistance is need by athletes. This makes people feel that the company genuinely cares for them, and contributes to their well-being.
The second element of NB culture is its employees, the management attaches primary importance to the level of their skills and competence, each worker takes obligatory training courses in order to improve ones competence. New Balance also ensures that each employee receives all necessary support from the company, including health insurance, pension, sick leaves and so forth. This policy helps the firm to guard its reputation. The essence of their culture lies in the belief that employees must be satisfied with their work and payment.
Improvement
Nevertheless, there are certain areas, which may be improved. As it has been noted before, NB pays more attention to the functionality of their shoes than to the fashion. Of course, functionality is one of the deepest concerns for the customer but the potential buyer first looks at the appearance and this immensely influences his or her choice. In contrast, Nike or Adidas never overlook this aspect, and in part this is the reason why their products are so popular all over the world.
In this respect, we should mention that NB is not so well-known oversees as its competitors. Perhaps, it might be prudent to popularize this brand in other counties, such the Eastern Europe, India, Asia, because this market still remains unexplored. Another suggestion that can be made is that company may widen the range of its goods, for example, New Balance has the capacity to manufacture articles of clothing such as shorts or trousers. This requires additional investments but at the moment NB is quite capable of breaking new grounds.
Conclusion
Therefore, we can arrive at the conclusion that in order to continue to be successful, New Balance must first adhere to its major policies, in particular, customization of the products, constant innovation, and willingness to refine their shoe models. Their manufacturing process has always been based on the interactions with the customer, and such approach should remain the dominant one. Besides, the management must continue to meet the quality standards and employ only highly-skilled personal. In other words, the enterprise should not transfer its activities to the third world countries in pursuit of profits, because this will easily ruin its reputation.
We may make some suggestions that may possibly stimulate the growth of this organization. New Balance should invest more capital in the exploration of foreign markets. Finally, the company may begin to expand its production line.
References
Jr. Thompson, Arthur A, A. J. Strickland, III, A. J. Strickland III, John E Gamble (2004). “Crafting and Executing Strategy: Text and Readings with Online Learning Center with Premium Content Card” McGraw Hill Professional.