Discussion
Elevators are one of the largest means of public transportation in the world (Renner, 2016). They move millions of people all around the globe on a daily basis. For most of the people they generate reactions that resembles the fear of flying experienced in the airplanes, that is claustrophobia or a feeling of note being in control. This report bases on analysing the Otis Elevator company by applying strategic management theories, tools and concepts that are covered in the unit for analysing the case. The main objective of this paper is to analyse the case study of Otis Elevator from the management perspective. It shall elaborate on analysing the external environmental forces that are influencing this company and would analyse the competencies and capabilities of company. It shall also assess whether or not these capabilities and competencies of this company are enough to cope up with the upcoming challenges that are faced by it and to boost its global business.
Otis Elevator Company is one of the widely popular manufacturer of moving walkways, escalators and elevators. It was founded in the year 1853 and is headquartered in Farmington, Connecticut, United States (Graham, 2017). It belongs to vertical transport systems industry and designs, installs and manufactures a wide variety of freight elevators and passenger for the low-speed, medium-speed and high-speed applications. The history of the company highlights its ever increasing growth and also its innovation products and strategies in the industry. Elisha
It provides the products in order to upgrade the escalators and elevators and also offers the repair and maintenance services for its services and products. With the same, it also provides REM (Remote Elevator Monitoring) systems in order to identify the problems of the elevators and the EMS panorama system for monitoring, controlling and reporting the operational functions of the elevators (Kirchhoff et al., 2018). This company caters to the residential and the commercial properties. It operates in more than 200 different nations and services more than 1.9 million of escalators and elevators all over the world (McCormack, 2014). The company operates as one of the subsidiaries of the UTC (United Technologies Corporation). lt has a number of well-known business areas including Sikorsky (Black Hawk helicopters), Chubb security, a range of aerospace products and Pratt &Whitney
PEST Analysis
PEST analysis refers to the measurement tool that is used for assessing the markets for a specific product or business within a given time frame. It stands for Political, Economic, Social and Technological factors that is influencing an industry or business.
Company background
Political environment- Due to the equal opportunity regulations and anti-discrimination laws, in more number of multi-storey buildings, elevators are required to be included as per the laws. With the same, according to the political environment of Australia, the companies under this industry should pay in advance their taxed to the state, i.e., a notable amount of revenues are been freeze by the value added tax (VAT).
Economic environment- At present, the industry of vertical transport systems is still recovering itself from the crisis of the year 2009. The demand of the customers are rapidly increasing as well as the sales are increasing. Otis has a lot of competitors which are also engaged in the transport activities (Anzola et al., 2016).
Social- Otis Elevator Company is benefitted from the trends of ageing population. As the people get older, they are less capable of climbing the stairs. Hence, the domestic escalators and elevators automatically becomes one of their necessities (Azarov et al., 2017). Along with the expansion of economies, there is a rise in incomes of the people and therefore, more number of people can now afford elevators.
Technological- The fast paced technological revolution is affecting this company to a great extent. Elevators can now-a-days talk and let the passengers to know the floors in which they are coming and going to and the companies or the building authorities could monitor the performance of the elevators remotely sitting at their rooms and even sitting in different continent. In future, it has been assumed that there would be an invention of space elevator by 2020. With the same, the digital technology has brought in a new element into the vertical transport systems industry. With the introduction of interactive TV screen, the advertisers are now able to promote their products and services in the elevators. In this way, Otis make money for itself as well as for the building operators. The interactive TV screens could also serve for multiple purposes comprising of the work of informing the passengers about the problems, providing them with advertising, offering them entertainment and videoconferencing with the rescuers.
The core capabilities of Otis Elevator Company are that it has innovative technology and there is a development of sophisticated elevator control solutions (Al-Kodmany, 2015). With the same, it is also to note that this company has undergone a rapid transformation of technology into new processes and products. Also, it has transformed its business model into digitised model. The core competencies of Otis Elevator Company are that it has installed elevators in some of the most famous structures and buildings of the world including Eiffel tower, Burj Khalifa, WTC, Petronas etc (Schroeder-Brumloop et al., 2017). It also a worldwide acclaimed brand in the vertical transport system industry. Its services are available in more than 200 different nations and it is continuously investing in new technologies, products as well as in intelligent systems. Furthermore its barriers to entry is comparatively high and approximately 66000 employees are employed within the company. Otis has also invented the safety elevator for his employer in the year 1852.
External environmental forces influencing the company
Otis Elevator Company has a very powerful growth in India, Brazil and China as well as in other significant Asian countries (Nolan, 2014). The capabilities and competencies of this company is helping it in successfully handling with the external influence and for facing the challenges. However, it is also to note that the company needs to capitalise on the opportunities for growth due to stagnation in the comparatively developed markets. With the same, along with a very strong history and reputation in the global market, Otis has a very vast Resource and development resources and is continuously keeping on implementing new innovative ideas and technologies (Arkalgud, 2017). Such a strong competencies and capabilities of this company could also help it in engaging into strong tie-ups with the construction and real-estate companies and could also boost the business.
Conclusion
Hence from the above discussion it is clear that Otis is regarded as one of the dominant players in the international elevator industry. The world is becoming more vertical than ever before, hence elevator demand is strong. At present, Otis Elevator Company is successfully managing its business in the global market. After using the PEST analysis tool it is clear that the trends in the social level is helping the Otis Elevator company is growing and developing further. With the growing age of the people, the demand for elevators get increased as they slowly become incapable of walking stairs on their own. Hence, it can be said that the company is getting benefits from the trend of ageing population. Furthermore, due to the several laws present in Australia elevators are required to be included. It is also helping the company to increase its revenue. Moreover, it is also clear from the above analysis that Otis Elevator Company has a very strong competencies and capabilities of innovative technology and a development of sophisticated elevator control solution. Such a strong competencies and capabilities of this company is helping it in engaging into strong tie-ups with the construction and real-estate companies. It also is boosting its business in the global market.
References
Al-Kodmany, K. (2015). Tall buildings and elevators: a review of recent technological advances. Buildings, 5(3), 1070-1104.
Anzola, D., Neumann, M., Möhring, M., & Troitzsch, K. G. (2016). National Mafia-Type Organisations: Local Threat, Global Reach. In Social Dimensions of Organised Crime (pp. 9-23).
Arkalgud, R. (2017). Contributions of the Corporate Sector to Sustainable Development. In Biodiversity for Sustainable Development (pp. 31-78). Springer, Cham.
Azarov, V. N., Artemenko, A. E., Kabanov, A. S., & Morgunov, M. Y. (2017, September). Risks and threats in the processes of transport security. In ” Quality Management, Transport and Information Security, Information Technologies”(IT&QM&IS), 2017 International Conference (pp. 47-54). IEEE.
Graham, S. (2017). Vertical Mobilities: Confronting the Politics of Elevators in Tall Buildings and Ultra-Deep Mining. In Exploring Networked Urban Mobilities (pp. 96-123).
Kirchhoff, F., Hnida, M. G. W., Wilke, M., Lorenz, H. L., & Herkel, P. (2018). U.S. Patent Application No. 15/572,948.
McCormack, D. (2014). Pipes and cables. The Handbook of Mobilities Research, 225-232.
Nolan, P. (2014). Globalisation and Industrial Policy: The Case of C hina. The World Economy, 37(6), 747-764.
Renner, M. (2016). Supporting sustainable transportation. In State of the World (pp. 177-194). Island Press, Washington, DC.
Schroeder-Brumloop, H. L., Rebillard, P., Sirigu, G., Dukacz, O. S., Stripling, R. S., Illan, J. A., … & Martin, J. (2017). U.S. Patent No. 9,637,349. Washington, DC: U.S. Patent and Trademark Office.
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