Research Paper on:
Komatsu Limited Case Study

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orientation. Over the years, Komatsu began producing other products, such as steel castings and then a two-ton crawler tractor. During the war Komatsu began producing bulldozers, tanks and other military  equipment. By the 1960s, the company was making high quality products with great durability. In the 1970s holding the dominant position in Japan, they began an aggressive expansion overseas; it  was already in Western Europe and the U.S. but marketing became more intense. Caterpillar held both world dominance and U.S. dominance. Komatsu priced its machines 30 to 40 percent  less than Caterpillars, giving it a price edge and it soon cut into Caterpillars market. By the middle of the 1970s, Komatsu held 60 percent of the Japanese market and  the company decided to focus on improving their products even further. They increased the models of their equipment from 46 to 77 between 1976 and 1981. They also initiated a  cost-reduction plan. Through licensing agreements, which they would subsequently withdrew from, Komatsu had eight subsidiary companies, 20 offices and 160 distributors outside of Japan. Even with 56 dealers in  the U.S., Komatsu could not compete with Caterpillar. Komatsus success meant more intense competition in the industry. The company launched some initiatives, such as the "F and F" project -  Futures and Frontiers. Through this project, the company asked all employees to contribute ideas and suggestions for new products. Numerous new products were developed as a result. There was always  an emphasis on R&D and this division became even more important. Komatsu was enjoying worldwide success but top management believed they would be facing even greater competition because the market  would become stagnant. One senior marketing executive, for instance, commented that Caterpillars distribution network was superior to Komatsus. other managers noted it was easier for Caterpillar to change with the