PRESENTED BY- Digvijay Salunkhe Pranab Chaudhary Gaurav Gulati Anand Sharma

 Automobile industry was the fastest growing industry at the beginning of 20 th century.  The tire industry was booming during the first three decades.  Explosive growth, technical ferment & low entry barriers attracted entrepreneurs to the industry.  In 1900 Harvey Firestone started Firestone Tire and Rubber Co. at Akron.

 Firestone focused itself as tire manufacturing company.  Harvey firestone, a pioneer in sports marketing, invested heavily in company’s brand.  He sponsored the winner of Indianapolis 500.  In 1902 firestone decided to bring production in house and build a tire factory in Akron.  Firm invested heavily in R&D, hence the factory and technology was both specialized and durable.  The firm focused on improving manufacturing. The brought new innovations in improving tire life, ride & safety.

 Firestone committed to new customers, like Henry Ford and maintained a healthy relationship.  Firestone also took great care in binding his company as one family.  After the death of Harvey Firestone in 1938, the company integrated backward as well as forward.  After the death of Harvey Firestone company did not stop to make progress.

 As at the beginning of 20 th century automobile industry was the fastest growing industry, Harvey Firestone realized the importance of tire industry.  Successful Firms must always realize the upcoming needs of the market.

 Unlike other rubber industries Firestone identified itself as a Rubber tire industry.  At the establishment point, firm must try to focus on specific market segment.

 The firm invested heavily in R&D, which allowed firestone to bypass competitors patent on tire design and gain large share of market.  Firms must always keep on innovating better products as per market needs.

 Firestone perfected the process of Gum Dipping and Advertised the process.  A firm should have a high USP and should differentiate it from others.

 Harvey Firestone built a good relationship with struggling entrepreneur Henry Ford.  A firm must identify upcoming customers and be committed to them.

 Harvey Firestone viewed his workers as paternalistically. He committed to set a values to bind his company as a family.  Firm must value their workers to built a mutually loyal relationship.

 Francois Michelin entered the tire market in Europe with new Radial Technology, which Firestone failed to identify earlier.  After the death of Harvey Firestone, managers of Firestone were unable to identify emerging trends of automobile industry.

 Firestone used existing technology to manufacture Radial tires with minor alterations.  This resulted in low quality of tires, which they had to recall back.

 Although the automobile companies were shifting to Radial technology, firestone failed to close bias tire plants.  As radial tire lasted twice than bias tire, many tire plants were closed, but firestone after investing in new technology did not closed its old plants.

 Firestone were having emotional attachment with its employees, and old plants, which were called as gum dip managers. So there were no new ideas.  Firestone, thus kept on loosing the confidence of their shareholders.

 Shareholders patience finally ran out, and they proposed to fire the top managers.  Japanese tire manufacturing firm acquired Firestone, and with rising dispute terminated the century long relationship with Ford.

 Even after firestone was acquired by Bridgestone, they still advocated the use of belted tires, instead of radial tires.  Firestone’s major competitor Goodyear, adopted the radial technology, consequences were company successfully defended its leadership in global tire industry.

THANK YOU.