What are Steinway’s resources and capabilities? Are they strong? Strengthening? Weakening? How do you know?
Steinway and Sons has been recognized as the market leader for high-quality grand pianos. The firm had prospered due to its technical excellence and innovation (technology) in making these high quality pianos. The firm enjoyed valuable, rare and inimitable resources. It had two manufacturing facilities (infrastructure), one in Long Island City, NY and the other in Hamburg, Germany. The firm produced high-quality pianos using craft method rather than highly automated production lines (operations). This made the product inimitable producing legendary sound and a customizable piano to suit a musician. A musician always found the …show more content…
They had 35% world market and 50% of Japanese market ($1 billion in 1994). Yamaha manufactured pianos using highly automated assembly line techniques. They also produced limited concert grand piano using traditional craft method and implemented continuous improvement. Yamaha invested in reverse engineering to emulate Steinway design. Yamaha also claimed that it had sourced its lumber from the same places Steinway. It was a vertically integrated company that was evidenced by the fact that there were very few piano manufacturers who cast their own iron plates. They marketed their pianos in major universities and music institutions that valued high quality, prompt delivery and competitive pricing offered by Yamaha. Yamaha also waived fees for delivery and in-hall tuning for concert artists. Yamaha was enjoying the switch of “Steinway Artist” Andre Watts endorsing Yamaha as his piano of choice. All these factors including healthy financials of Yamaha posed threat to Steinway.

Yamaha has been unsuccessful in breaking into Steinway’s competitive space. What recommendations would you give Yamaha?
Yamaha has far greater share of the overall piano market compared to Steinway (35% worldwide). Yamaha also had larger diversity in its pricing. Yamaha should continue to capture the mid-range market that Steinway intends to capture using the Boston piano. Yamaha could also