The Michelin Company was founded in 1889 in Clermont-Ferrand (France) by Edouard Michelin. Initially, Michelin employed 52 persons in a plant spread over 32 acres. Edouard Michelin benefited of his brother's (André Michelin) support. The two brothers were complementary: André was an innovator, and Edouard a charismatic leader. This family orientation is a key element for understanding the Michelin Company. The company has been led as one of the largest family businesses, which explains the tensions caused by relocation, or the uncertainty that followed Edouard's sudden death. Indeed, Edouard Michelin's disappearance from the firm was a veritable tragedy for the company. His father, François Michelin, was engaged with the international development of the company. Very early, François handed the reins of the company to his son Edouard. At the time of Edouard's death he was the youngest CEO on the CAC 40 (Paris Stock Index), at only 42 years old. After this tragic accident, Michelin's stock was going down and the future seemed uncertain. Now, for the first time, the reins of the company passed into the hands of a person who was not a member of the Michelin family. With the appointment of Michel Roullier, Michelin began to lose its old family structure (delocalization issue), and the company had to readjust its image to its values.
[...] appointment of Michel Roullier, Michelin began to lose its old family structure (delocalization issue), and the company had to readjust its image to its values. Tire and innovations Innovations are another driving force behind Michelin. The company has seen great success, thanks to its technological advances such as the first patents for detachable tires (1889), the invention of tires for the first trucks (1908), a detachable steel wheel prefiguring the spare wheel (1913), radial technology (1955) and so on. Michelin also had many other patents in the future and also took part in important projects like the invention of the special tires for Space Shuttle and the Airbus A380. [...]
[...] IV) Conclusion Considering the facts mentioned above we come to the conclusion, that the Michelin Group more or less followed the “Establishment Chain” as the main modus operandi for its internationalization process. The establishment chain is characterized by the four following steps: 1. No regular exports 2. Exports via agents 3. Sales subsidiary 4. Production in a foreign market Of course there are only a few regular exports between regions, because Michelin is always present in each important market as a producer. [...]
[...] As demonstrated, the strategic program is based on three steps: “concentration of industrial capacity into larger and more specialized facilities, using more flexible, standardized and streamlined production processes; deployment of best practices, and thorough improvement of processes and organizations; planned natural attrition of nearly 20,000 employees in the 2006-2010 timeframe, to be only partially replaced.” III) Analysis of the internationalization process Start of the internationalization process The internationalization process started very early in the year 1906, with the foundation of the Michelin Tire & Co Ltd. [...]
[...] Michelin dared to take the brave step of going abroad to North America very early, opening their first plant outside Europe in Milton, New Jersey in 1907. Until this decade, the concept of a decentralized production with existing plants for each regional market, and the production for every specific area was recognizable. In Europe and North America, Michelin followed this concept very strictly by having a plant in nearly every country. The company's slogan is in accordance with this modus operandi: “Michelin established closest to its customers”. [...]
[...] In comparison to the network approach or the internationalization approach, the establishment of a chain seems to best explain the internationalization process of the Michelin Company. However, there are also single steps are not followed one by one, and cannot be identified clearly. Did Michelin succeed in its internationalization? Michelin has been very successful in its internationalization process. Nowadays, Michelin and its largest competitor Bridgestone are the leading companies in the market. It is a head to head race for the first position. [...]
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