...TIS ELEVATOR Accelerating Business Transformation with IT Company Background Otis Elevator is named for the company’s founder, Elisha Graves Otis, who invented the “safety brake elevator” in 1853, then become of the company under United Technologies (UTC). Otis core business was the design, manufacture, installation, and service of elevators and related products, including escalators and moving walkways. By 2004, Otis had 1.5 million elevators and 100,000 escalators operating throughout the world. Otis had elevators in 10 of the world’s 20 tallest buildings and more than 1.4 million elevators and escalators under maintenance. Otis sold products in more than 200 countries and territories. Engineering headquarters was in Farmington, Connecticut with international facilities in Japan, France, Germany, Spain, Korea, and China. Revenues climbed from $6 billion in 2000 to $8 billion by the end of 2003 with 80% coming from outside the United States. The company had always provided solid and steady profit contribution to UTC since its acquisition more than 25 years earlier. In the period from 2000 through 2003, Otis’s contribution to UTC’s profit increased from 25% to 35%. Otis’s sales and profit growth helped drive the strong performance of UTC, which had projected revenue of $35 billion for 2004, 14% over 2003’s. Early Application of IT (OTISLINE) In The early 1980s, Otis created a centralized customer service system to dispatch service mechanics. IT worked...
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...Business Context Elisha Graves Otis founded the company when he first founded the ‘Safety brake elevator’ in 1853. From then the company’s main focus was to design and manufacture the safety systems according to the customers need. The Otis Elevator Company became a subsidiary of United Technologies (UTC). It is one of the largest manufacturing industries in the world. It not only manufactures but also installs the equipment in the respective customer desired locations. It then continues its relationship with the customers by providing timely service facilities. It was soon recognized as a leader in service excellence among all the companies. The main competitors included multinational companies such as Hitachi, Kinetek, KONE, etc. Otis grew aggressively by acquiring elevator business in China. By 2004, the company had 1.5 million elevators and 100,000 escalators operating in the world. Its revenues increased by $6 billion. The company was a huge success. Initiatives taken to improvise 1. OTISLINE customer service center During any service emergency, the service panel was dispatched from the local offices that caused huge delay time and hence decreasing customer satisfaction. The OTISLINE customer service center was created to dispatch service mechanics on immediate requests. The main aim was to implement 24x7 concept. This initiative also allowed Otis to produce ‘excess’ callback reports for various levels of management. The managers had the information they needed...
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...The inclusion of a brief summary (‘Executive Summary’) is standard reporting practice and is meant to act as a guide to the contents of the report and to highlight major conclusions and recommendations. The Executive Summary derives its name from the practice of providing the executives of an organisation, that is, those responsible for making decisions and taking appropriate action, with a concise outline of the major points in a report to save them time. The detail can be pursued in more depth later by a complete reading of the report. The structure of the Executive Summary should follow the structure of the report and include brief statements on the following: definition of the problem aims and objectives methods/data sources key findings conclusions any recommendations for action. The Executive Summary should be brief and succinct, and may use point form to achieve this. As a rule-of-thumb, allow one page for every 5,000 words up to a maximum of five pages, and using headings in longer Executive Summaries. The inclusion of an Executive Summary is not a substitute for discussion/exposition in the full report. Example of an Executive Summary Problem context & Purpose of report Method Results Conclusions Recommendations Limitations This report provides an analysis and evaluation of the current and prospective profitability, liquidity and financial stability of Outdoor Equipment Ltd. Methods of analysis include trend, horizontal and vertical...
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...Otis Elevator: Accelerating Business Transformation with IT Otis was the largest manufacturer, installer, and servicer of elevators, escalators, and moving walkways in the world. Otis Elevator company has reformed itself as a service oriented company from an old line industrial company. This was possible due to the company’s focus on orders of magnitude improvements in logistics and service. It has integrated all the functions needed in perspective of customer and developed a single customer-centric business model. One Interesting fact is that 80% of the company’s revenue comes from outside the united states. This emphasizes that globalization played a significant role in terms of customer base, revenue. So, going forward the company should concentrate in expanding it’s operations all over the world, especially the emerging economies and attaining diversified customer database. One can easily infer form Otis transformation that Information Technology, Improvement in information flow and understanding market trend, customer needs plays a major role in changing the face of the company. Otis has restructured itself taking upon the fact that customer service, maintenance contributes more to the market along with the sales. OTISLINE Customer service center is one of the early IT applications in Otis which helped Otis dispatch group respond to customer in less than a sec. IT applications aids in improving visibility of business performance to management and...
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...Otis and the Central Role of Information and IT May 18, 2011 I. Key Business Objectives Bousbib developed several key business objectives in response to the changing operational landscape of elevators, escalators and moving walkways industry. No longer would Otis be considered an “old-line industrial company.” Among these key initiatives and changes were: * Vision: Become the “recognized leader in service excellence among all companies – not just elevator companies – worldwide.” * Culture: Change the norms, values and processes of Otis – how they do business – so that the company focus shifts from a manufacturing company to that of a service company. Become the number one service company in the world. * Systems/Functions: Both systems and business functions need to be changed to align their processes and procedures with the new company vision and culture. This included integrating pre-existing systems already established in the company such as Otisline and REM and go from managing the flow of products, to managing the flow of information. * Growth: Provide excellent service in mature elevator regions as service and repair account for 75% of revenues in these locations. Expand to key growth areas and emerging markets such as China in order to win new business and stay ahead of their competitors. * Redefine Services: Go beyond traditional support tools such as Otisline and REM and include new equipment design, supply chain, new equipment delivery...
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...In 1965, Otis Redding wrote and released the song “Respect” which two years later became a smash hit for Aretha Franklin. The stories told by Franklin’s version are significantly different from Otis Redding’s original. Otis Redding’s version describes a man who will give anything to his woman as long as he gets respect. However, Aretha Franklin’s cover demands respect not only from her man as well as the man. “Respect” is not only a catchy song about relationships, but has an underlying meaning that focused on the social movements at the time. The song was able to have multiple meanings due to Aretha Franklin making noteworthy changes from the original. Aretha Franklin reinvented the song, “Respect” with notable revisions to the music, lyrics...
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...Otis Elevator: Accelerating Business Transformation with IT At Harvard the only thing considered duller, safer, and less adventurous than working for a bank was working for some old-line can't-miss industrial firm like Otis Elevator, which only needed caretakers. —Tom Wolfe, A Man in Full (New York: Farrar, Straus and Giroux, 1998), p. 31 At the northeast corner of 20th Street is the turreted red-brick Victorian Apartment house . . . the first cooperative apartment house in New York City. Peek into the luxurious lobby! The foyer is adorned with stained glass and Minton tiles, and the building is equipped with Otis hydraulic elevators installed in 1883, and among the oldest of their kind still in service. —Gerard R. Wolfe, New York: 15 Walking Tours (New York: McGraw-Hill, 2003), p. 261 In early 2004, Otis Elevator President An Bousbib (pronounced boozbe) finalized his presentation to United Technologies (UTC)—the parent company. The past 12 months had been a success for Otis, as highlighted in the 2003 Annual Report: Otis completed the second-largest acquisition in its history with the addition of Amtech Elevator Services. Amtech brings . . . a customer base spanning universities, hotels, hospitals, airports and convention centers throughout the United States. Overall, Otis revenues grew by more than $1 billion to $7.9 billion. Operating profit increased by more than $300 million to $1.38 billion, and operating profit margin grew by more than one point to 17.4%) Otis was the...
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... what a great collaboration, and a smooth fellow caressing the notes and keys to his trumpet. The group was led by two awesome vocalists of which were male and female. They had astounding voices and quickly aroused the audience, even captivating the local pedestrians who were strolling around the neighborhood. I believe the best part about this performance was that it was free admission and therefore, I had extra pocket change to snag a beer and socialize with other attendees. The set up and arrangements were nice and it all seemed well planned but I strongly felt that they could have used a bigger stage so they would have more room to dance and get jiggy with it. Other than that, I loved that they played several old school hits such as: Otis Redding’s “Sitting on the dock of the Bay,” Aretha Franklin’s “Respect,” and The Temptations’ “Poppa was a Rolling Stone.” The performance overall was a great mixture of instruments and vocals. It would have related well with the Christian community as far as drawing people near with good vibes and great...
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...Jones: Introduction To Business: How Companies III. A Functional Approach to Business 12. Operations and Materials Management: © The McGraw-Hill Companies, 2007 Create Value for People Managing the Production and Flow of Goods and CHAPTER 12 Operations and Materials Management: Managing the Production and Flow of Goods and Services Learning Objectives After studying this chapter, you should be able to: 1. Describe the nature of the operations and materials management process and explain how it can create a competitive advantage for a company. 2. Identify the five main components of operations and materials management costs and the methods companies use to reduce them. 3. Differentiate between the three major kinds of operating systems companies use to produce goods and services. 4. Understand the way total quality management can significantly improve both quality and productivity. WHY IS THIS IMPORTANT Flour, eggs, sugar, baking powder, chocolate, and shortening don’t create much excitement when they are in the kitchen cupboard. They create a lot more excitement when someone transforms them into a cake. Whether it’s a cake, a computer, or a legal docu- ment, operations and materials management processes create value in a household or a company. A company’s operations require inputs such as raw materials or parts and the skilled people and equip- ment to transform them into useful products...
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...Summary of the case Otis Elevator was founded by Elisha Graves Otis, the inventor of the safety-brake elevator, in 1853. The main business of Otis was to design, manufacture, install and provide service for elevators and relevant products such as moving walkways and escalators. The market was very competitive in the elevator industry, and Otis investigated that customer cancelled maintenance agreements due to dissatisfaction for service quality rather than product quality. In order to increase its market share and become the well-known leader in service excellence among all companies worldwide, the goal of Otis was to differentiate itself from other companies through logistics and service. Otis’s objectives were 1. To improve innovation, quality, cost and speed during the continuous transformation process and; 2. To move Otis core business from product and service management to customer solution management, and in the end to logistics and information management. Using a single finance and manufacturing system enabled Otis to add value to its entire supply chain. Below, two main transformation waves shown the progress of changes from the manufacturing company toward a total solution company to customers by Otis. Firstly, Otis introduced OTISLINE and REM, which facilitated the company to increase the efficiency of customer service and customer satisfaction. OTISLINE was a 24 hour customer service center, which produced excess callback reports to improve product...
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...Otis Elevator: Accelerating Business Transformation With IT Otis Elevator, a subsidiary of United Technology, has witnessed many transformations since Elisha Graves Otis first found the company in 1853. As a result of these transformations, the company has become the leader in its industry as the world’s largest manufacturer, installer, and servicer of elevators, escalators, and moving walkways. Across the world, the company has over 1.5 billion elevators and over 100,000 escalators in operation, with some operating inside some of the world’s most prominent building structures. Today, mainly informational technology (IT) is responsible for the company becoming the leader of its industry. During the years from 2000 to 2004, the company experienced significant growth and grew to over 61,000 employees with operations in over 200 countries. As this growth occurred, the elevator service market became more stable as there were now elevators installed in almost all buildings in the world’s major cities. The company’s profits now relied heavily on the service and repair of elevators and escalators. The problem at hand was that the company was facing new competitors in the global market, including other similar elevators manufacturers and also other companies that exclusively offered elevator services and repairs. At this point in time the then president of Otis Elevators, Ari Bousbib, knew it was time to remake the company “To become the recognized leader in service excellence among...
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...OTISLINE Otis Elevator was the world leader in elevator sales and services with $2 billion in revenues in 1984. New equipment sales and service of elevators formed the two main business segments in the industry. Otis led the former category owing to its technological superior and reliable products. The service market was competitive and had many players. Otis had opportunity to gain a bigger market share in this by delivering better service at a competitive price to its customers. Investing in OTISLINE Service market was more fragmented than the new equipment sales. Company’s market share dependent on responsiveness, price and quality. Responsiveness to customer call backs was seen as the main differentiating factor in assessing the quality of a service company. OTISLINE not only helped in this regard but also improved Otis’ service by impacting the following headers: Customer Service – Call back responsiveness was greatly enhanced since OTISLINE made service available 24 hours a day and reduced the time to fulfil the service requests. Microprocessors technology – The future of elevator technology lied in microprocessors and to provide servicing to those microprocessor powered elevators required access to propriety information which small service providers would not have. Thus Otis with OTISLINE would have a comparative advantage in better handling the needs of the future. Process automation – Otis had historically pursued automation of their manual process, OTISLINE...
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...might be the motivation for Otis to launch this project? Otis, a subsidiary of United Technologies Corporation, was the first elevator company to introduce microchip into the elevator mechanism. It incorporated the latest technology into its elevators, (indicating that Otis was investing in the technology as it saw some advantage out of it.) Otis installed its first computer IBM 1401 in 1965 to automate maintenance billing which was used for production control and accounting. It kept upgrading its information systems from time to time as and when new computer or technology was available. But this still was unorganized as each department had separate technological advances, i.e. in some departments like billing and production, the technology was advanced, but in departments like dispatching it was still lagging behind. This led to the inefficiency in dispatching. They introduced information technology in 1981 to check the feasibility of centralized customer service department. It used answering machines to turnaround on weekends and no prime time calls, which was inefficient. Hence Brad Robertson decided to start the OTISLINE project which would improve the visibility of the service business and help in better managing of the current operations. • • • • • • They used answering machines to turnaround on weekends and no prime time calls, which was inefficient. Remain the Market Leader: In order to remain at the market leader position, OTIS had to ensure a better product...
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...Case Analysis of Schindler By University of Maryland University College AMBA 660 Week 8 August 31, 2012 Introduction The paper will discuss the challenges faced by Silvio Napoli, in carrying out Schindler’s expansion into the Indian elevator market at the request of the VRA, the corporate committee of Schindler which included Alfred Schindler (CEO), Luc Bonnard (Vice Chairman), and Alfred Spoerri (CFO). To begin Silvio Napoli, a young MBA from France, a third-country national, was fully responsible for the Indian expansion, and he had to get operations up and running and profitable in for years. His challenges included staffing and implementing a business plan he developed. Napoli’s plan two basic premises 1) to sell standardized elevators in India, and 2) outsource manufacturing and logistics in India. Napoli’s plan had success earlier in his career in 1995 with the Swatch Project that bested industry standard 20- to 30- week cycles by 50% with this same approach. Other challenges faced by Napoli included pressure in family his family life as a result of poor planning and no employee assistance program to get his family acclimated to Indian culture. That poor work-life balance distracted Napoli to the point where he could focus on neither his work, nor personal life. After 8 months he had not installed one unit and had orders that were contrary to the standardization strategy his entire business plan was based on. Government activities that affected Schindler’s...
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...joint venture between Otis Elevator Company, CITIC and TEC, and some changes I think may be necessary in the Joint Venture proposal. Exhibit A summarizes the current business overview of Otis and its competitors, which is important to understand the context of the JV and how will a JV in China would be helpful for Otis’s market position. I think this is a good time for Otis to enter the Chinese market. Otis entered China earlier in 1930, and left the country in 1951 due to political instability of the country. A quick timeline of China’s political evolution is highlighted in Exhibit B. The conditions persistent in the country in 1951 are very different from the present conditions in 1983. China has experienced immense growth in all sectors, and the construction industry is booming due to modernization efforts. Even after the death of Deng, I think his successors would encourage foreign investments because all these effort are producing good results in terms of GDP growth, exports, and technological know-how (Exhibits 3, 4 and 5 of the case) for China. In addition to all these, China-Schindler joint venture has proved very successful. This strengthening position of Schindler poses a threat to the market share of Otis. Other smaller players, such as Hitachi, are also entering into agreements with Chinese elevator companies. Also, the JV proposal is for Tianjin, the third largest Chinese city which is also emerging as a major exports hub. This gives Otis an excellent opportunity...
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