Lock & Lock
IME 20051164 Junghee Pyeon
IME 20051206 Wootaek Hwang
IME 20051214 Joonhyung Ahn
CONTENTS
1. Company & Product Overview
(1) Company Overview
(2) Product Overview
2. Business Analysis
(1)
(2)
(3)
(4)
SWOT Analysis
TOWS Analysis
Five Force Analysis
BCG Matrix
(1)
(2)
(3)
(4)
(5)
(6)
(7)
(8)
Collaboration Strategies
Sources of Innovation
Patterns of Innovation
Types of Innovation
Dominant Design
Timing of Entry
Choosing Innovation Projects
Protecting Innovation
3. Strategic Management of Innovation
CONTENTS
1. Company & Product Overview
(1) Company Overview
(2) Product Overview
2. Business Analysis
(1)
(2)
(3)
(4)
SWOT Analysis
TOWS Analysis
Five Force Analysis
BCG Matrix
(1)
(2)
(3)
(4)
(5)
(6)
(7)
(8)
Collaboration Strategies
Sources of Innovation
Patterns of Innovation
Types of Innovation
Dominant Design
Timing of Entry
Choosing Innovation Projects
Protecting Innovation
3. Strategic Management of Innovation
1. Company & Product Overview
(1) Company Overview
Since its establishment in 1978, Lock&Lock Co. Ltd has been
grown as a global company that exports its products
(Lock&Lock containers with new-concept four side interlocking
system) to more than 100 countries worldwide.
1. Company & Product Overview
(1) Company Overview
 Export Destinations
1. Company & Product Overview
(1) Company Overview
 Financial Status
Sales
2007
Million Won
2008
2009
2010(half)
Operating profit
2007
2008
Million Won
2009
2010(half)
Lock&Lock has been grown very fast since its establishment,
and aim to achieve 10 trillion Won sales in 2020.
1. Company & Product Overview
(2) Product Overview (1/3)
 Product Type
Plastic Container
Glass Container
1. Company & Product Overview
(2) Product Overview (2/3)
Bis-free Container
Many customers have
concerns that plastic containers
make environmental hormones.
Glass containers also have some
disadvantages such as heavy
weight, fragileness, and so on.
Lock&Lock developed a new
technology container called Bisfree, which is lighter than glass
and doesn’t make any
environmental hormones.
1. Company & Product Overview
(2) Product Overview (3/3)
 Product Characteristics
(1) 4-side interlocking system
(2) Hollow silicon packing
The patented technology of
interlocking all four sides and the
hollow silicon packing are utilized
for the products.
CONTENTS
1. Company & Product Overview
(1) Company Overview
(2) Product Overview
2. Business Analysis
(1)
(2)
(3)
(4)
SWOT Analysis
TOWS Analysis
Five Force Analysis
BCG Matrix
(1)
(2)
(3)
(4)
(5)
(6)
(7)
(8)
Collaboration Strategies
Sources of Innovation
Patterns of Innovation
Types of Innovation
Dominant Design
Timing of Entry
Choosing Innovation Projects
Protecting Innovation
3. Strategic Management of Innovation
2. Business Analysis
(1) SWOT Analysis
Strength
• Powerful brand image
Weakness
• No other business models
• High market share
• Patents
• Know-how
• R&D
• Big market(ex. China, U.S.)
SWOT
• Many copies & Fake products
• Global brand awareness
• Various airtight products
• Modern life style
Opportunities
Threats
2. Business Analysis
(2) TOWS Analysis
S-O
• By using know-how, diversify products
• By using global image, target global market
• By using brand image, grow the market
share
S-T
• Concentrating on “high quality and good
brand image” through various promotions &
campaign
TOWS
• Prepare for new business models, although
it is not profitable right now.
W-O
• Protecting innovation restrain fake product,
allowing Lock&Lock diversify the business
model.
W-T
2. Business Analysis
(3) Five Forces Analysis
High
Low
Bargaining power of
suppliers
• Raw materials are easy
to buy
Potential Entrance
• Existing Korean
companies
• Foreign low quality &
low price container
companies
Existing Rivalry
• Copies
• KOMAX, GLASSLOCK,
etc
Threats of substitutes
• Tradition containers
Bargaining power of
buyers
• Many copies with low
price. But, because of
brand image,
Rock&Rock can sell high
price.
2. Business Analysis
(4) BCG Matrix
Star
Question Mark
Ceramic or glass
airtight
container
High
Market Growth
Water bottle
and
Thermos
Cooking
equipment
Plastic
airtight
container
Kitchen utensils
Living box
Low
Cash Cow
High
Dog
Middle
Market Share
Low
CONTENTS
1. Company & Product Overview
(1) Company Overview
(2) Product Overview
2. Business Analysis
(1)
(2)
(3)
(4)
SWOT Analysis
TOWS Analysis
Five Force Analysis
BCG Matrix
(1)
(2)
(3)
(4)
(5)
(6)
(7)
(8)
Collaboration Strategies
Sources of Innovation
Patterns of Innovation
Types of Innovation
Dominant Design
Timing of Entry
Choosing Innovation Projects
Protecting Innovation
3. Strategic Management of Innovation
3. Strategic Management of Innovation
(1) Collaboration Strategies (1/10)
 Strategic Alliance (1/3)
Lock&Lock made a strategic alliance with partners which needs
high quality air-tight containers such as tea, ice cream and so on.
The company provide customized air-tight containers to the
partners
Ex1) Tea container
In 2004, Damtuh, a tea
maker, launched lemon tea and
peach tea with Lock&Lock
container. More than 10,000
products were sold just within
one week after launching it.
3. Strategic Management of Innovation
(1) Collaboration Strategies (2/10)
 Strategic Alliance (2/3)
Ex2) Tea container
In 2011, Baskin Robbins 31,
an ice cream maker, started a
promotion event that if a
customer buy an ice cream
which is bigger than quartersize, the company provide
Lock&Lock container with just
1,000 KRW.
3. Strategic Management of Innovation
(1) Collaboration Strategies (3/10)
 Strategic Alliance (3/3)
Ex3) Doosan Bears Tumbler
In 2011, Doosan Bears, a
baseball team, made tumblers
with Lock&Lock’s technology.
3. Strategic Management of Innovation
(1) Collaboration Strategies (4/10)
 Joint Venture
Since air-tight container market is red ocean, Lock&Lock
needed to enter a new market but it had no speciality in other
fields. So they made a joint venture with companies in other
fields.
Ex) Zen&Lock
In 2006, Lock&Lock made a
joint venture with Zen Korea, a
ceramic container maker, to
produce ceramic air-tight
container. The joint venture got
400,000 pieces order right after
it launched ceramic air-tight
Kimchi container.
3. Strategic Management of Innovation
(1) Collaboration Strategies (5/10)
 Outsourcing
Ex) Design Outsourcing of
Speed Cook
In 2011, Lock&Lock launched
Speed Cook, a lamen cooker.
Since Lock&Lock’s core
competency is manufacturing
technologies, not designs, the
company outsourced this
design function to Motto
Design, a design company.
3. Strategic Management of Innovation
(1) Collaboration Strategies (6/10)
 Design Idea Collaboration for Localization
India
Western Countries
Korea
Ex) Locally Customized Design
Depending on regions, customers have different needs. For
example most Indians need flat bread containers, Westerns need
cereal containers, and Koreans need Kimchi containers. These design
ideas mostly came from local buyers and collaborators in each region.
3. Strategic Management of Innovation
(1) Collaboration Strategies (7/10)
 Promotion Collaboration (1/2)
Ex) Promotion through famous home-shopping channels
At the beginning of launching Lock&Lock, since the company
wanted to make a high-quality brand image, it chose QVC, the No.1
home shopping channel in the world, as a business partner.
3. Strategic Management of Innovation
(1) Collaboration Strategies (8/10)
 Promotion Collaboration (2/2)
Ex) Partnership with promotion agencies
When Lock&Lock enter unfamiliar regions, the company formed a
partnership with promotion companies which have more knowledge
about the region. They formed a partnership with Starcom to enter
Japan and UK markets, and with Hill & Knowlton to enter China
markets.
3. Strategic Management of Innovation
(1) Collaboration Strategies (9/10)
 Summary (1/2)
<Protecting Core Competency>
Lock&Lock’s core competency
is technological superiority over
other competitors. To take
advantages of this, the company
relies only on in-house R&D, and
does not collaborate with other
companies in R&D part.
<Collaborating Strategically>
Since Lock&Lock is a air-tight
container production company,
the company has no special
knowledge about design,
promotion, and so on. To
overcome this shortage, the
company collaborated with other
specialist in that field. And also
sometimes it made strategic
alliance with other industry
players to boost the sales of its
products.
3. Strategic Management of Innovation
(1) Collaboration Strategies (10/10)
 Summary (2/2)
Collaboration of a certain function in a firm
should be determined
depending on its strategic importance!!!
3. Strategic Management of Innovation
(2) Source of Innovation
 Customer Needs
People want to buy a container which doesn’t spill over a
content in the container.
 Needs for Airtight Container
3. Strategic Management of Innovation
(3) Pattern of Innovation
 Added New Characteristic
Not related to traditional patterns of Innovation
 Added New Characteristic: New Characteristic is added to New
Product. It can be one of patterns of Innovation.
3. Strategic Management of Innovation
(4) Types of Innovation
1.
Product vs. Process
2.
Radical vs. Incremental
3.
Competence Enhancing vs. Competence Destroying
4.
Architectural vs. Component
 Added New Characteristic to existing product Product
Innovation & Component Innovation
 Because of Rock&Rock, almost whole container is replaced
with Rock & Rock  Radical Innovation
 In 1978, Lock&Lock Co. Ltd has manufactured more than 600
products including kitchen wares  Competence Enhancing
Innovation
3. Strategic Management of Innovation
(5) Dominant Design (1/2)
Kukjin Distribution Co. founded in
1978 launched Lock&Lock products
having the technology of interlocking
all four sides and the hollow silicon
packing. Lock&Lock instead of rubber
cover have become the dominant design
in airtight container market.
Now, Lock&Lock is the byword for
airtight container. Lock&Lock is not only
a premium airtight container but also the
best brand of airtight container market in
China. Also, Lock&Lock’s awareness in
Korea is 99%.
3. Strategic Management of Innovation
(5) Dominant Design (2/2)
Komax
Glasslock
Network Externality help Lock&Lock
the dominant design of airtight
container. Collaboration between
Lock&Lock and lots of company, rising
Lock&Lock’s brand awareness.
Winner-Take-All Markets didn’t
occur. There are two strong competitors.
Lock&Lock can’t be a natural monopoly
company not only because Komax
makes the airtight container having
superior design and high quality but
also because Glasslock makes airtight
container consist of glass having
attractiveness for Western culture.
3. Strategic Management of Innovation
(6) Timing of Entry (1/2)
 Follower
Many people think Rock&Rock is the first mover. But, the first
mover is KOMAX in an airtight container market. That is, Rock&Rock
is the follower.
3. Strategic Management of Innovation
(6) Timing of Entry (2/2)
 How does Lock&Lock lead the market, rather than
KOMAX?
When KOMAX and Rock&Rock launched an airtight container,
people didn’t know how the container was useful for them. So,
Rock&Rock used TV home shopping to explain the usefulness of an
airtight container. Because of TV home shopping, people started to
use Rock&Rock container. So, Rock&Rock can lead the market,
rather than KOMAX.
3. Strategic Management of Innovation
(7) Choosing Innovation Project (1/2)
Since its establishment in 1978,
Lock&Lock Co. Ltd had
manufactured various products
which are more than 600 including
kitchen and bathroom ware.
But, since 1998, the company has
focused its core competency only
on Lock&Lock products and stop
investing to other products groups.
Just 6 years after launching
Lock&Lock products, the company
extended its market share by 60%
in Korea, and became the world 3rd
largest company in the food storage
container industry.
3. Strategic Management of Innovation
(7) Choosing Innovation Project (2/2)
Lock&Lock manufactured huge
amount of various products before
1998. Jun-il Kim thought Lock&Lock
had to focus on one product having
brand power, so he made 20 criteria
for choosing product.
 Easy to manage inventory
 Not fragile
 Small volume
 Independent to season
 Independent to culture
Air-tight container was the best
product meeting all criteria of
qualitative choosing process and
these decision has been excellent.
3. Strategic Management of Innovation
(8) Protecting Innovation (1/2)
Lock&Lock takes advantages of protecting technological
innovation rather than diffusing it. Since the company’s core
competency is technological superiority over the other companies,
they need to protect their intellectual properties through patent,
trademark, and design registrations.
In addition, the company organized a special team which is
responsible for preventing others from imitating Lock&Lock products.
In 2010, they found a fake product manufacturing factory in China
and confiscate many imitations.
3. Strategic Management of Innovation
(8) Protecting Innovation (2/2)
Lock&Lock promote the method to
distinguish the real Lock&Lock product
from the imitation product using the web
site and the store. This strategy is so
effective in the long run, although it isn’t
effect on consumer in the short run.
Lock&Lock don’t sue the company
making the imitation product, but with
market sharing power, Lock&Lock prevent
the distributors from selling the imitation
product. Because legal action ain't holding
no air in China.
Q&A