Hitachi Limited: Construction Machinery

Name: Hitachi Limited: Construction Machinery (English version)
SKU: W35323

Derek Lehmberg

Product #:W35323

Supplier:Ivey

Discipline:Strategy

Setting:Japan, 2021

Details:Case (PDF) • 20 pages • 2024-01-25

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In 2021, Hitachi Limited was reconsidering its ownership of Hitachi Construction Machinery (HCM). The decision about HCM’s future was one of the last steps in a more than decade-long effort to reorient Hitachi from a manufacturing conglomerate to a service-oriented company. HCM was a global player in the construction and mining equipment business, and although it no longer relied on Hitachi for product technology, Hitachi’s technological capabilities might once again become more valuable to HCM as automation and electrification of construction and mining equipment gained importance. Would there be greater synergies from more closely integrating HCM with Hitachi’s other businesses, or would both sides be better off if HCM was completely independent?

Learning Objectives

This case is suited for use in strategic management courses at the undergraduate and master of business administration (MBA) levels. After preparing and discussing the case, students will be able to:

Appreciate the complexity of corporate-level strategic decision-making in large, complex organizations.
Grasp the difficulty of implementing major changes to existing corporate-level strategies in large, complex organizations.
Make distinctions between related and unrelated diversification.
Identify potential synergies between different businesses.
Evaluate costs and benefits of diversification options.

Hitachi Limited: Construction Machinery

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Learning Objectives