Sample Management Essay Paper on Differentiation Strategy

Differentiation Strategy

 Mercedes-Benz Daimler AG

Mercedes Benz is a German automobile manufacturer established under Daimler AG. Mercedes produces high-end luxury cars, buses, and trucks. Its target clientele is the global high-end market due to the quality and durability of the cars they manufacture. Its array of clients includes individuals, corporates, and governments. Its products include, sedans, ambulance carriers, coupes, trucks, and armored trucks among others to tackle on road and off-road terrains (Shapiro, 1994).

Mission Statement

Mercedes believe that, every call is a challenge and that with every task comes a chance to grow. “Our vision is to become the world’s most renowned center for customer service in the automotive sector” (Ashwin, 2000). To achieve this goal, the company purposes to go an extra mile to harness skilled human capital from the entire world as only the best staff can ensure the provision of the best customer services. “Our purpose is to satisfy our partners’ and clients’ needs.”

Vision Statement

            “Dedicated to Customers, Driven by Excellence.” As Mercedes-Benz brand executives we are committed to excellence, targeting to ensure superior solutions for our clients, retail partners, and business associates by supporting them in whichever automobile situation. In doing this, we promote the brand and add value to brand Mercedes’ promise: “The best or nothing”. We are committed to our organizational values and as the Mercedes Benz fraternity; our outstanding operations set the bar for the global automobile customer support centers.

  • Firm’s Targets and Strategic Goals

            Mercedes Benz Company targets to ensure global customer satisfaction through offering support services at their satellite dealerships worldwide. Mercedes is a multinational brand whose products are consumed internationally. The company, therefore, ensures that these dealerships receive follow-up support services including vehicle spare parts and servicing for worn out cars.

    Setting the pace in innovation to produce energy saving and cost effective automobiles without compromising quality. The company endeavors to go green by ensuring that their products are environmentally safe and that emissions are reduced tremendously.

Mercedes purposes to produce a wide array of cars to suit customer needs. Mercedes have fast-tracked the manufacture of off-road automobiles with strict adherence to safety measures. This invention was done purposely to target the countryside residents who suffer logistical and access problems. This 4*4 model guarantees these clients safety, class and off-road performance.

Through strategic partnerships, Mercedes indulged in the production of or armored luxury vehicles with reinforced security featured including bulletproof windshields, mirrors and vehicle bodies. This technology was sought to fill the market niche sought by corporate leaderships, presidential security services as well as private individuals due to the high-risk nature of their jobs.

To be a leader in the transport industry through production of top notch transport carriers. Mercedes produces the Actros brand of Tipper, and haulier road trains and buses. Through this leadership in transport vehicles manufacture, Mercedes has ensured that it attracts clients from the entire divide. The twin carrier bus has taken city touring to the next level. Tourists and visitors can take bus tours through city streets on the open ‘storey’ buses.

2. Mercedes Benz uses the Divisional Structure to manage its global operations

The company’s management structure matches the divisional structure. It has its headquarters in Stuttgart, Germany, but has autonomous branches in the USA, Britain, France, Brazil, and South Africa among other nations. The Supervisory Board, which makes major company decisions including major appointments is found at the headquarters (Shapiro, 1994). Immediately under the Supervisory Board is the Board of Management, which is mandated with the appointment of regional general managers. These Regional affiliates are managed by general managers who are appointed and supervised by the board of management. These affiliate branches run on their own budgets raised from revenues resulting from their sales. They make their own decisions at the local level. The general managers organize for the appointments of the departmental managers in charge of finance, production, sales, and brand marketing. Departmental managers organize for the recruitment of staff based on the company needs including salespersons and customer care staff (Hancké, 2000).

The current management structure at the Mercedes Daimler has increased management costs in terms of human resource remuneration and payment of taxes among others. Its bulk at the base structure has ensured unusually high management costs hence unsustainability. The company constitution stipulates that there has to be unanimous agreement between the supervisory board and the board of management for major company decisions to be made. This bureaucracy can really hamper decision-making processes, especially for situations that call for expeditious decisions. Additionally, unhealthy competition among divisions is bound to occur. Some clients’ insistence on purchasing a particular car brand from a certain division is bound to affect sales in other divisions. Intense competition from other high end and medium end brands such as the Japanese Toyota and the UK Land Rover are eating way into markets formerly controlled by Mercedes. Introduction of the V- engine series, V-6, V8, V-10 and V-12 engines as well as body reconfiguration by Toyota is winning away clients from Mercedes. The opulence and class exuded by the Range rover machines by land rover isn’t cutting  Mercedes any slack either.


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Hancké, B. (2000). European works councils and industrial restructuring in the European         motor industry. European Journal of Industrial Relations , 6 (1), 35–59.

Katzenstein, P. J. (1985). Small States in World Markets: Industrial Policy in Europe. NY,     Ithaca: Cornell University Press.

Shapiro, H. (1994). Engines of Growth: The State and Transnational Auto Companies in         Brazil & S Africa. . Cambridge: Cambridge University Press.