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FIRESTONE TIRES

PRESENTED BY- Digvijay Salunkhe Pranab Chaudhary Gaurav Gulati Anand Sharma. FIRESTONE TIRES. BACKGROUND. Automobile industry was the fastest growing industry at the beginning of 20 th century. The tire industry was booming during the first three decades.

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FIRESTONE TIRES

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  1. PRESENTED BY- DigvijaySalunkhe PranabChaudhary GauravGulati Anand Sharma FIRESTONE TIRES

  2. BACKGROUND • Automobile industry was the fastest growing industry at the beginning of 20th century. • The tire industry was booming during the first three decades. • Explosive growth, technical ferment & low entry barriers attracted entrepreneurs to the industry. • In 1900 Harvey Firestone started Firestone Tire and Rubber Co. at Akron.

  3. Firestone focused itself as tire manufacturing company. • Harvey firestone , a pioneer in sports marketing, invested heavily in company’s brand. • He sponsored the winner of Indianapolis 500. • In 1902 firestone decided to bring production in house and build a tire factory in Akron. • Firm invested heavily in R&D, hence the factory and technology was both specialized and durable. • The firm focused on improving manufacturing. The brought new innovations in improving tire life, ride & safety.

  4. Firestone committed to new customers, like Henry Ford and maintained a healthy relationship. • Firestone also took great care in binding his company as one family. • After the death of Harvey Firestone in 1938, the company integrated backward as well as forward. • After the death of Harvey Firestone company did not stop to make progress.

  5. WHY DO FIRMS SUCCEEED? • As at the beginning of 20th century automobile industry was the fastest growing industry, Harvey Firestone realized the importance of tire industry. • Successful Firms must always realize the upcoming needs of the market.

  6. Unlike other rubber industries Firestone identified itself as a Rubber tire industry. • At the establishment point, firm must try to focus on specific market segment.

  7. The firm invested heavily in R&D, which allowed firestone to bypass competitors patent on tire design and gain large share of market. • Firms must always keep on innovating better products as per market needs.

  8. Firestone perfected the process of Gum Dipping and Advertised the process. • A firm should have a high USP and should differentiate it from others.

  9. Harvey Firestone built a good relationship with struggling entrepreneur Henry Ford. • A firm must identify upcoming customers and be committed to them.

  10. Harvey Firestone viewed his workers as paternalistically. He committed to set a values to bind his company as a family. • Firm must value their workers to built a mutually loyal relationship.

  11. WHY DO SUCCESSFUL COMPANIES FAIL? • Francois Michelin entered the tire market in Europe with new Radial Technology, which Firestone failed to identify earlier. • After the death of Harvey Firestone, managers of Firestone were unable to identify emerging trends of automobile industry.

  12. Firestone used existing technology to manufacture Radial tires with minor alterations. • This resulted in low quality of tires, which they had to recall back.

  13. Although the automobile companies were shifting to Radial technology, firestone failed to close bias tire plants. • As radial tire lasted twice than bias tire, many tire plants were closed, but firestone after investing in new technology did not closed its old plants.

  14. Firestone were having emotional attachment with its employees, and old plants, which were called as gum dip managers. So there were no new ideas. • Firestone, thus kept on loosing the confidence of their shareholders.

  15. Shareholders patience finally ran out, and they proposed to fire the top managers. • Japanese tire manufacturing firm acquired Firestone, and with rising dispute terminated the century long relationship with Ford.

  16. Even after firestone was acquired by Bridgestone, they still advocated the use of belted tires, instead of radial tires. • Firestone’s major competitor Goodyear, adopted the radial technology, consequences were company successfully defended its leadership in global tire industry.

  17. THANK YOU.

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