How to improve LM wind power's

business in face of strong competitors

and advent of new technology?
 CONTENTS
1. Brief Introduction of LM Wind Power
• Mission, Vision and Values Analysis
• Business Model
• B2B and Current Trends
2. External Analysis
•Macro-PESTEL Analysis of LM
•Micro-Porter's Five Forces of LM
•Competitor Analysis of LM
3. Internal Analysis
•Resource Based View (VRIO analysis)
•SWOT Analysis of LM Wind Power
4. Alternatives considered and Recommendations
•Strategic Choice(Generic) and Strategic Direction(Ansoff).
•Alternatives and Recommendation
•Evaluation(SAF)
•Implementation Plan
•Risk Assessment of Implementation Plan
•Conclusion and further questions
01 • Mission, Vision and Values Analysis
Brief Introduction of LM Wind Power

• Business Model
• B2B and Current Trends
 Brief Introduction of LM Wind Power
Founded Year 1940
Headquartered Kolding Denmark
• Design and manufactures blades
• Provide maintenance,repair, installation support
Business
• Provide supplementary logistics services

Global business office Amsterdam, Netherlands

13 locations in 8 countries (Denmark, Spain,
Global Market
USA, Canada, India, China, Poland and Brazil)

Global network of R&D: Denmark, Netherlands, India.

No. of Employees
8,178(2017)

Turnover (€ Mn) 1,059.4(2017)

(Source : MarketLine)
 (source: LM Annual Report 2017)

蓝色扁平清新通
2018
用
Lorem ipsum dolor sit amet, consectetur
 LM Wind Power M&V

“Together, we capture the wind to power a cleaner world”

LM Wind Power's business model is based on a green and reliable

product and our unique ability to create value in efficient
partnerships, with suppliers and customers as well as internally.
Together, we secure clean energy for the world many years into the
future.

(source:www.lmwindpower.com)
 M&V Analysis of LM
Positive Negative
• Vision statement truly reflects the team work value of • It doesn't address customers or market segment.
the company by stating together as the first word in the
vision statement. • Concern for survival and growth and profitability is not
mentioned.
• Domain of activity is referred in the vision statement.

• The mission statement refers to product and technology

which is electricity made by wind.

• The company's main feature is to create clean and green

power. It is completely stated in the mission statement.

• Concern for employees are mostly covered in the values

of the company.
LM Wind Power 5 values
1. Focus on customer and market
2. Work as one team
3. Trust and respect
4. Take ownership
5. Innovate for excellence

(source:www.lmwindpower.com)
 LM Value Analysis

Positive Negative
• Focus on customers: tailor-made blades • The unclear long-term strategy

• Team-work spirit of the company • Competitive advantage definition is missing

• innovation
 (source: LM Annual Report 2017)

蓝色扁平清新通
2018
用
Lorem ipsum dolor sit amet, consectetur
 Distribution and Current Trends of LM
B2B Products are sold to wind turbine makers as general

Current trends • Find international scope, for example: launching the factory abroad insted of
export.

• The future technology of bladeless turbines.

• The end Life of the products.

Mega trends • Most of the countries need to move towards green energy to improve the
country’s infrastructure and sustainable position

• Environmental issues have become a big concern worldwide.

• According to the literature in 2009, 62% of energy investment were in the area
of renewable energies in European Union as a leader
02 External Analysis
• Macro-PESTEL Analysis of LM
• Micro-Porter's Five Forces of LM
• Competitor Analysis of LM
Macro-LM PESTEL Analysis
Political and Legal
Factors:
•Governmental Support
•Better Allowances
•Less Taxation.
•Environmental Laws

Technological Economical Factors:

Factor: •Growing wind blade
demand.
• R & D Expansion
• Strong Infrastructure
of Carbon Free Energy
Production.

Social Factor: Environmental

•Current Trend of Green Factor:
Energy. •Green Energy
Production.
•Affected Marine Life.
Micro-Porter's Five Forces of LM
 Competitor Analysis
Competitor Analysis

10
9
8
7
6
5
4
3 TPI Composite
2
1 LM Wind Power Company
0
Employee Global Market Innovativeness Financial Strength Customer Service Product Quality

LM Wind Power Company TPI Composite

03 Internal Analysis
• Resource Based View (VRIO analysis)
• SWOT Analysis of LM Wind Power
 VRIO Analysis of LM

Valuable Rare Inimitable Organized

YES YES NO YES

LM Wind power has all the Limited amount of

TPI Composite also The resources
required resources and resources
capabilities needed to have better technology supported by
respond to the environmental for designing and organisation
threats and opportunities. Temporary competitive
production LM GE
advantage
 SWOT of LM
Strengths Weaknesses Opportunities Threats

• Favorable
Renewable • Operationnal Issues
• Market Research • Policies: European • Increasing
• Time consuming
• Focused R&D Union Popularity of
• Energy consuming
• Operational • Wind Market: the Substitute Energy
• Mantenance
Performance US Sources
• Waste
• Offshore locations • Addition of Blade • Competition
Factory: China

(Source: MarketLine)
 The SWOT Matrix Analysis of LM
(RuiLi)
Internal Facts

E
x
Strength(S) Weakness(W)
T Opportunities(O 1.New technology trend reinforce 1.Time consuming production.
) the green energy. 2.The problem of maintenance.
e development and strength market stimulate the new technology development.
r penetration. 3.Expensive time and energy consuming testing for
n 2.Off-shore locations bring more new products.
a opportunities and enlarge the
l economic of scale.
3.Know-how for blade production.
4.Bench mark on being the longest
blade producer.
F
a Threats(T) 1.Bladeless wind mills. 1.Expansive production in comparison with the size
c 2.High cost installation in off-shore of the company will reduce the profit margin.
t sites. 2.High cost for installation.
3.Product life cycle. 3.Expensive value chain.
s
4.Pure green production.
04 Alternatives and Recommendation
• Strategic Choice(Generic) and Strategic
Direction(Ansoff).
• Alternatives and Recommendation
• Evaluation(SAF)
• Implementation Plan
• Risk Assessment of Implementation Plan
• Conclusion
(source:www.lmwindpower.com)
Strategic Choice of LM
Strategic Direction of LM-Market development

Mid-term

By-product
Short-term

Short-term Long-term

Recyclable products
New business

Entering new markets

(where the main competitor has not
made a bench market yet, For example:
Russia, Africa)
 Alternatives and Recommendations
Alternatives Recommendations

• Cost-efficient

Organic Growth • Diversity products

• Technology innovation

Acquisition, merger and Joint Venture • Acquisition

Internationalization • Transnational Strategy

Evaluation of the choice of strategy(SAF)
1.Cost Not
Suitable Feasible
Efficient Acceptable

2. Diversity Not
Suitable Acceptable
Product Feasible

3.
Technology Suitable Acceptable Feasible
Innovations

4.Acquisition Suitable Acceptable Feasible

5.
Transnational Suitable Acceptable Feasible
Strategy
 Implementation Plan of LM
Short-term Mid-term Long-term

• Enlarge the market share • Innovate the value • Innovation leadership

chain
(Forward or Backward
Upstream integration)
• Lower the risk of
Optimize technology
dependency
(by- products)
Accelerate speed • R&D recyclable material
of producing

• Recyclable materiel patterns

Re-cooperate • Value configuration
Align with locals strategic model
companies
to reduce the
waste
Add Value • Use their knowledge and
technology in new business
Downstream • Lock-in business For example: innovative
models usage of a special kind of
rubber)
 Risk Assessment of implementation plan of LM
• Financial risk
Risk • Other green energy threats
• Integration of technical resources

• Lost the competitive advantage

Impact • Restrained in the market share
• Shaken out in facing of the growing competition

• Strength the HRM to hire and maintain global

Mitigation actions high-tech engineers
• Strength the relationship with customers and
network in host countries.
• Upstream and downstream
• communicate closely.
 Conclusion and further considerations
M&V Reflection Conclusion Further Considerations:

• Cleaner world • Technology innovation • Time and money

• Green energy • Transnational strategy consuming
• In the long run, the • Increase the price
technology innovation will • Decrease competitive
gain the benchmark and advantage
sustainability.