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Case Presentation Barco Projection Systems

Case Background. A division of Barco N. V.Barco N. V. began in 1934 in the

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Case Presentation Barco Projection Systems

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    1. Case Presentation Barco Projection Systems Robert D. Rogers (Group of 1) 2/12/08 “And so it begins…”

    2. Case Background A division of Barco N. V. Barco N. V. began in 1934 in the “electronic” industry 1948 developed television receiver and the consumer market was responsible for the bulk of the company’s revenue. 1955 to 1975 was a period of rapid growth with expansion into broadcast monitors and video equipment. Inflection point occurred in late 1970’s and the company redefined itself as a player in industrial markets. Barco Projection Systems Strategy High-end products in niche markets BPS is relies on technical leverage in product development R & D is a major strength, requiring 8-10% of revenue and 15% of employee capital Market expansion is accomplished first through channels of distribution with a network of 45 distributors and 400 dealers worldwide; in key markets the distributors are “company operations;” in 1989 growth was enhanced through $110M in acquisitions. There was a belief on the part of management that the R&D expenditures and the complexity of the technology afforded Barco some market protection.

    3. Case Background BPS Product Development Projection system based on 3-gun projection technology BPS is a leader in application of its technology Product mix is based on equivalent technology in tubes, lenses and electronics in three markets defined by combinations of product performance in brightness, image quality and resolution. Electronics comprise 50% of component cost and is used to differentiate BPS products based on scan rate; variations in scan rate define the three market segments, video, data and graphics. By 1983, the growth of the projector product paralleled the changes in the computer market; from 1983 to 1989 the product line showed good growth in high-end applications. By 1989 the product line was being expanded into digitally controlled projectors (BD700) to match the growth in computer processing speed; this new line was to be available in October 1989. Product development was a function of engineering solutions and not based on a market-driven plan Product differentiation was based on image quality, input flexibility and “user-friendliness.” Market Structure Three markets defined by product characteristics BPS and Sony were market leaders Market growth was directly related to performance

    4. Product Market Structure

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