Strategy roadmap 2013-2018 development at Schaeffler automotive aftermarket Italy

The Final Project represents a detailed overview of the activities and responsibilities taken during the internship period spent at the company Schaeffler Italy, in Momo, Novara. In period from April to September 2013, company was developing a strategic document that will enable its Automotive Aftermarket department to sustain its growth in the next five years. As the intern of the department, at the position “Marketing and Communication Intern”, I was directly involved and engaged on the creation of the “Strategy Roadmap 2013-2018” document and on the activities related to its development. 1. Issues and context of references Recent economic downturn and crisis in all Europe has left a big impact on the way how the companies are doing their businesses. Need for improvement is present, more than ever before. In the new economic reality, many small and big business had to change the way they are planning their operations and execute tasks, due to the unstable business environment. Market became more demanding, with high restrictions and limitations and only by changing the approach to the market and clients, companies were able to sustain their business during the past turbulent period. For the past 5 years the annual growth rate of Automotive Aftermarket in Western Europe countries was near zero or even slightly below. The minor changes in market shares together with barely existent growth are an indication of balanced competition. Market volume growth in Western Europe is not expected in the coming years. Vehicle density is already so high that their number can hardly change . Car registrations in Italy are decreasing and the purchase power has decreased dramatically as well. Another factor in the rising competitive pressure is technical development and higher quality in production of spare parts that means longer spare parts lifetime. All these facts have a big impact on the suppliers and all the levels of the automotive value chain. Schaeffler Group, being one of the leaders at the market, was not an exemption. Due to its complex business organizational structure and centralization, Schaeffler Group had to respond on the new situation by optimizing its decision-making processes and adapt to the new reality. One of the steps that company has taken was decentralization of certain decision making processes and giving more freedom to the national branches in development of its own strategies for sustaining the operations and creating environment for small but sustainable growth. Nevertheless, even though the national branches received certain level of freedom, when it comes to the creation of market’s specific strategies, there was a need for an integrated and a coherent strategy at a higher level that would drive the growth of the Schaeffler as a brand and the market’s leader. National strategies had to be integrated into a much wider strategic document, driven by the vision of Schaeffler’s management. These national strategic documents, in combination with the European strategic map, would enable Schaeffler to leverage on risks on both micro and macro levels, while realizing potential for growth and approaches to capture these opportunities. Schaeffler’s national branches in Western Europe received a complex task to develop strategic national long-term plans, with the guidance, and limitations, of Schaeffler’s European Strategy Map. For this purpose, Schaeffler Italia developed a “Strategy Roadmap 2013-2018” for automotive aftermarket that has the aim to drive both national growth, and European growth of Schaeffler Group in the upcoming period. 2. Objectives The purpose of this project is to present steps and phases of Strategy Roadmap’s development as well as the concrete findings and the actions of the plan itself. All the data presented in this project were acquired during the internship period, April – September 2013, in Schaeffler’s Automotive Aftermarket Department. The analyses that were conducted helped the company to realize and clearly see AS IS situation. Based on the strategic findings, company was able to further define its vision, strategy and its targets, the TO BE state it wishes to reach. In Strategy Roadmap, certain projects and initiatives for the upcoming period were defined, that would enable company to face strongly all the challenges and reduce the potential threats and risks. The report includes the general description of the company and products, deep internal and external analysis, strategic findings, strategy definition, strategic targets, proposed projects and initiatives and final strategy roadmap. All the findings were presented at the central level and the final version of the “Strategy Roadmap 2013-2018” had to be aligned with the Schaeffler’s European strategy and approved by the senior management of Schaeffler’s automotive aftermarket department for Western Europe. 3. Conclusions The key issues that were identified are: internal logistic problems; Increasing importance of e-commerce, online sales, eCRM and digital communication and marketing; Technology development – growth of electric and hybrid car’s sales, e-mobility and car sharing as well as the economic decline that can endanger company’s position and allow fast market’s enter for low cost competitors from other parts of the World, in particular from Asia. In order to deal better with all the above mentioned key issues and threats, Schaeffler Italia, together with the Schaeffler’s department for Automotive Aftermarket for Western Europe, developed a Strategy Roadmap, with a systematic and clear vision, that will drive it through the next five years.