Group report
BMW company
Prepared by:
Victoria Tikhonova
Anna Kichigina
Anastasia Loseva
Сontent
History of BMW……………………………………………………………….
Milestones of success…………………………………………………………..
BMW innovations……………………………………………………………....
Current situation at the company……………………………………………….
Competitors…………………………………………………………………….
Future of the company………………………………………………………….
Personal attitude to the company……………………………………………….
History of BMW company
Bayerische Motoren Werke AG (BMW), (English: Bavarian Motor Works) is an independent Germanautomobile manufacturer founded in 1916. BMW is a worldwide manufacturer of high-performance and premiumautomobiles and motorcycles, and is the current parent company of both the MINI and Rolls-Roycecarbrands.
Milestones of the history:
1916 – Founding of Bayerische Flugzeug-Werke. The new company incorporated Otto-Werke. BMW acquired the BFW site in 1922, but Bayerische Motoren Werke continues to regard BFW’s establishment as its date of founding.
1917 – Rapp-Motoren Werke was renamed Bayerische Motoren Werke GmbH. The company constructed a large plant and built engines for military aircraft there till 1918.
1918 – Bayerische Motoren Werke GmbH was converted into a stock corporation with a share capital of 12 million Reichsmarks. BMW GmbH becomes BMW AG.
After World War I, BMW (and Germany) were forced to cease aircraft (engine) production by the terms of the Versailles Armistice Treaty. The company consequently shifted to motorcycle production in 1923 once the restrictions of the treaty started to be lifted, followed by automobiles in 1928.
The circular blue and white BMW logo or roundel is often alleged to portray the movement of an airplane propeller, an interpretation that BMW adopted for convenience in 1929, which was actually twelve years after the roundel was created. In fact, the emblem evolved from the circular Rapp Motorenwerke company logo, from which the BMW company grew. The Rapp logo was combined with the blue and white colors of the flag of Bavaria to produce the BMW roundel so familiar today.
By 1959 the automotive division of BMW was in financial difficulties and a shareholders meeting was held to decide whether to go into liquidation or find a way of carrying on. It was decided to carry on and to try to cash in on the current economy car boom enjoyed so successfully by some of Germany's ex-aircraft manufacturers such as Messerschmitt and Heinkel. Therefore the rights to manufacture the tiny Italian Iso "Isetta" were bought using a modified form of BMW's own motorcycle engine. This was moderately successful and helped the company get back on its feet. The dominating shareholder of the BMW Aktiengesellschaft since 1959 is the Quandt family. Stefan Quandt, Johanna Quandt and Susanne Klatten (born Quandt) together own about 46% of the stocks. The rest is in public float.
BMW AG purchased the BritishRover Group (which at the time consisted of the Rover, Land Rover, MINI and MG brands as well as the rights to defunct brands including Austin and Morris) in 1994 and owned it for six years. By 2000, Rover was making huge losses and BMW decided to sell the combine. The MG and Rover brands were sold to the Phoenix Consortium to form MG Rover, while Land Rover was taken over by Ford. BMW, meanwhile, retained the rights to build the new MINI, which was launched in 2001.
Milestones of success
BMW's Dream Factory. Sharing the wealth, listening to even the lowest-ranking workers, and rewarding risk have paid off big time.
Management structure.
BMW's management structure is flat, flexible, entrepreneurial -- and fast, that enable the company to respond to competitive threats and market trends. The company has become the industry benchmark for high-performance premium cars, customized production, and savvy brand management, making it the envy of Mercedes-Benz (DCX ), Audi, and Lexus and the subject of Harvard Business School case studies. Even mighty Toyota Motor Corp. (TM ) regularly dispatches engineers to BMW's factories to see how the company cranks out 1.3 million customized cars a year.
Most innovative company.
The BMW Group is the most successful premium manufacturer in the automotive industry. One of the fundamental prerequisites for this success was and is ongoing leadership and innovation in the construction of cars perceived and acknowledged as leaders by the customer. Innovation upgrades the product in its substance, and only attractive product substance can secure the long-term success of a company in sales.
A further point is that innovation is the right tool to clearly stand out from the competition in an increasingly competitive premium market. Modern premium cars today have reached a comparably high level of technology in many respects, the customer taking features such as passive safety and quality for granted right from the start.
A few examples:
- Jet-guided High Precision Injection direct gasoline injection technology significantly reduces fuel consumption and increases engine output at the same time.
- Runflat tyres save space and weight by omitting the spare wheel and at the same time offer a significant enhancement of safety.
- Active Steering offers the driver supremacy on the road on fast straight-ahead stretches, outstanding agility in a rapid succession of bends, and comfortable steering behaviour when parking.
Only innovations offering clearly recognizable customer benefits, strengthening the character of cars and brands, meeting the greatest demands in terms of quality and reliability, and providing a sensible business case, meet the prerequisites for actual use in series production.
Through its EfficientDynamics concept, the BMW Group is continually generating fuel consumption reductions with the aim of offering the most efficient vehicle in each relevant premium segment. Measures taken to improve EfficientDynamics contribute to further reductions in fuel consumption and vehicle emissions, simultaneously enhancing both dynamics and performance. BMW Group’s engineers consider all potential areas for optimising a vehicle, including improved aerodynamics, more efficient engine technologies, lightweight construction through to a comprehensive system of energy and heat management within the vehicle. The BMW Group endeavors to make any new fuel consumption reducing technologies available to as many customers as possible, as soon as possible. This is seen as the only way to achieve ecological progress for the fleet as a whole.
In addition, the BMW Group will successively introduce the Auto Start/Stop Function feature to their range of models, starting with the BMW 1 Series. This innovation automatically switches off the engine as soon as the vehicle stops moving and starts it again extremely quickly as soon as the driver wishes to continue the journey. This technology can help to save a great deal of fuel, especially in urban stop-and-go driving conditions.
The technological lead.
To maintain its position as a worldwide technological leader in the automobile branch, transforming creative ideas into innovations is essential for the BMW Group. This is why we systematically develop and realize technologies for tomorrow's automobiles and motorcycles which hold a great deal of benefit for our customers. We have oriented our development and working structures accordingly.
Lateral thinking – getting ideas from the entire world.
New solutions are often spontaneously born by seeing examples from the widest imaginable fields, including architecture, art or nature. Studying nature – which has developed its fascinating richness over billions of years – gives us valuable inspirations for efficient technical solutions because the evolutionary process has constantly optimised natural functions. Building on these, aerodynamics scientists at the BMW Group have studied, for example, the streamlined bodies of dolphins to obtain new knowledge for designing automobiles.
Cooperation with science.
The BMW Group promotes constant dialog with scientists. In addition to numerous joint projects with research institutes and universities, the BMW Group bestows the internationally recognised and highly endowed prize for university students, the "Scientific Award", every two years. With the motto "Passion for Innovation", this prize promotes and honours the passion of young researchers and scientists taking an interdisciplinary approach to their work.
Virtual innovative agency
Shape the future with us!
Our task is to secure the long-term innovation and technology leadership of the BMW Group. To realise this goal, the BMW Group is permanently looking for unusual innovations on the subject "mobile future".
We are not only interested in our own research and development departments, but also in the creative minds outside the BMW Group. Your submission through the Virtual Innovation Agency (VIA) could be the start of a forward-looking cooperation with the BMW Group.
The path for your innovative solution into the world of the BMW Group!
If you have innovative solutions for our complex challenges, then you are on the right road with us. The Virtual Innovation Agency is the platform for you to bring your achievement into the world of the BMW Group.
Entrepreneurial culture.Happy Workers, Better Cars.
Much of BMW's success stems from an entrepreneurial culture that's rare in corporate Germany, where management is usually top-down and the gulf between workers and managers is vast. BMW's 106,000 employees have become a nimble network of true believers with few hierarchical barriers to hinder innovation. From the moment they set foot inside the company, workers are inculcated with a sense of place, history, and mission. Individuals from all strata of the corporation work elbow to elbow, creating informal networks where they can hatch even the most unorthodox ideas for making better Bimmers or boosting profits.
Just about everyone working for the Bavarian automaker -- from the factory floor to the design studios to the marketing department -- is encouraged to speak out. Ideas bubble up freely, and there is never a penalty for proposing a new way of doing things. BMW is "a fine-tuned learning system."
Ecology oriented.
To improve efficient use of resources (material, energy, water) by products as well as during production, a precise balance between ecological and economical issues must be sought after.
To save energy, production uses sophisticated central routing technology, for example. Thisenables energy-using components to be turned on and off precisely when needed. In addition, the use of heat reclamation equipment, use of industrial waste heat, and cold generation in absorption equipment supports the development of circulation systems. This makes it possible to exploit primary energy to a high degree, ensuring an energy supply which is also environmentally friendly.
BMW innovations
1. BMW's reputation for innovation can be traced to its equally innovative lateral management techniques.
"At lunch and breaks everyone is discussing ideas and projects all the time. It's somewhat manic. But it makes things move faster," says BMW chief designer Adrian vanHooydonk.
Companies such as BMW that leverage workers' tacit knowledge through networks (cross-functional teams) "are widely ahead of their competitors.
BMW is one of a handful of global companies including Nokia (NOK ) and Raytheon (RTN ) that have turned to networks to manage day-to-day operations, superseding classic hierarchies.
2. lighting-fast changes
BMW figures some 90% of the innovations in its new models are electronics-driven.
3. mobile-phone messages
To reach a younger crowd of potential buyers for its new 1 Series launch in 2004, BMW used mobile-phone messages as the main source of buzz, directing interested people to signups on BMW's Web site for pre-launch test drives in August that year—something unheard of in the industry at the time. The experimental tactic worked: BMW sparked responses from 150,000 potential customers—and sales of the 1 Series took off when it was launched in September, 2004.
4. ideas first
Workers at the Bavarian automaker are encouraged from their first day on the job to build a network or web of personal ties to speed problem-solving and innovation, be it in R&D, design, production, or marketing. Those ties run across divisions and up and down the chain of command. BMW's complex customized production system, the polar opposite of Toyota's (TM ) standardized lines, is easier to manage if workers feel empowered to drive change. Like Dell Computer (DELL ), BMW configures its cars to customers' orders, so each auto moving down the production line is different.
Current situation at the company
With BMW, MINI and Rolls-Royce Motor Cars, the BMW Group is the world's only car maker to pursue a purely premium strategy for all market sectors covered by its brands, from exclusive smaller cars to top-of-the-range luxury limousines. To achieve its aims, the company knows how to deploy its strengths with an efficiency that is unmatched in the automotive industry. The strategic objective is clearly defined: The BMW Group is the leading provider of premium products and premium services for individual mobility.
BMW brand - has stood for one thing: sheer driving pleasure. Sporting and dynamic performance combine with peerless design and exclusive quality, resulting in the unique appeal of BMW automobiles.
The MINI brand wins hearts and turns heads. MINI is refreshingly different: extroverted, spontaneous and in every respect something out of the ordinary. Ideal for a society, the MINI Classic became a cult vehicle in the sixties and seventies. MINI is part of a lifestyle that is cosmopolitan and confident, ready for everything.
Rolls-Royce is one of the most fascinating and well-known brands in the world, the luxury motor car par excellence. For over 100 years, motor cars of the Rolls-Royce brand have stood for truly outstanding engineering, quality and reliability.
Premium is the key word for BMW Group motorcycles as well. BMW group sets standards with regard to technology, environmental protection and safety, and provides outstanding customer service in the pre- and after-sales phases.
Financial services is a key factor for success in today's mobile world. They have established an extensive product portfolio which supplies expert information and advice for situations and questions relating to the finance sector. They provide the following services: financing and leasing, asset management, dealer financing and company car pools.
German luxury car group BMW said its third quarter results 2008 were hit by the global financial crisis despite a rise in sales.
The German group had developed leasing activities in the United States, its main export market, which suffered from credit defaults, late payments and problems in selling second-hand cars turned in by customers.
"The financial crisis worsened and the consumption climate grew dark again."
In October 2008 the sales volume of one of the biggest producer of premium-class automobiles fell on 8,3% in comparison with October 2007 till 113005 cars.
It is connected with the decrease of demand on developed markets. The sales in Western Europe fell on 12%, in the USA – on 5%, in Japan – on 29%. Sales in developing countries have risen: in India – on 10%, in China – on 36%, in Russia – on 40%.
The performance of the BMW Group in the third quarter 2008 was perceptibly influenced by the economic downswing in the wake of the financial crisis. Ongoing consumer reticence in the main sales markets, the weak state of the used car markets as well as increasing refinancing costs had a substantial negative impact on the earnings of the BMW Group.
In addition to the ongoing adverse business climate, the BMW Group's third-quarter performance was also influenced by model life-cycle factors, particularly in relation to the BMW brand. Between July and September 2008, the BMW Group sold a total of 349,098 BMW, MINI and Rolls-Royce brand cars, 4.2 % down on the previous year. The number of cars delivered in the nine-month period increased marginally (+ 1.7 %) to 1,113,972 units.
Market conditions for the motorcycle business were also difficult. The third-quarter sales volume achieved by the Motorcycles segment was nevertheless ahead of the previous year's high level. In total, 24,818 motorcycles were sold during the period (+ 5.4 %). During the first nine months of the year, 80,750 BMW motorcycles were handed over to customers, 2.5 % short of the number sold in the corresponding period of 2007.
Third-quarter Group revenues decreased by 8.6 % to euro 12,588 million, reflecting the noticeable reluctance of customers to spend in the face of the crisis on international financial markets. Despite this extremely unfavourable situation, the BMW Group, with revenues of euro 40,425 million, was nevertheless able to maintain nine-month revenues at the previous year's high level. Adjusted for exchange rate factors, Group revenues for the nine-month period were up by 5.1 %.
Earnings for the nine-month period reflect the ongoing effect of the various adverse external factors described above. In the third quarter 2008, the BMW Group increased the cumulative amount of expense recognised for additional risk provision for residual value and bad debt risks to a total of euro 1,037 million. On top of this, expenditure in conjunction with previously announced measures to reduce the workforce reduced nine-month earnings by euro 258 million.