Filter Innovations Inc. Hbr Case Analysis

2834 words - 11 pages

Problem StatementJohn Dragasevich is the president of Filter Innovation Inc. (FII), which is a small filtration company. With government restrictions becoming stricter and tighter, Dragasevich is faced with the decision to expand his company and invest in MBR (Membrane Biological Reactors) technology or continue operating his business like he has been doing.Key IssuesThe changing of government regulations towards water filtration systemsLose a competitive advantage from not investing in MBR technologyPrioritize environmental responsibilities at all times - MBR is best environmental optionPrimary Business Strategy - Retail vs. Customized ProductsIssue 1:MBR's are the new emerging technology for wastewater treatment because they allow for the re-usage of water. MBR's were designed to treat biological wastewater instead of ground water or industrial process water. MBR's are also the best environmental option for wastewater treatment.FII supplies treatment solutions for groundwater, wastewater, process water and air. They provide a variety of products that can be bought in store and through customized orders. Dragasevich wants to expand and grow his business by investing in MBR's. With new and strict government restrictions on the wastewater filtration systems, Dragasevich is faced with the decision to invest in a new technology.If Dragasevich decides to continue operating along his current business model, FII may face a couple of problems in the future. The first problem is that FII may lose clientele due to an existing wastewater treatment design that is against regulations in some industrial and municipal cases. If the regulations continue to evolve in the years to come, FII will either be forced to invest in MBR's or sell the business. The second problem is that FII may face legal complications if the regulations change on existing customers. If old filtration systems are not upgraded to the regulatory standards, FII may face a lawsuit.Issue 2:Many of FII's direct competitors (Sanitherm - 3% of MBR market, Enviroquip - 30% of MBR market in NA) have already invested in MBR's. FII would lose its competitive advantage if they decided to not invest in MBR's, which, in return, would cost FII customer and brand loyalty.Dragasevich finds it very important that FII be recognized as being at the forefront of the leading technology. "Its in our name…. Innovation!" Dragasevich said. If FII decided to not invest in MBR technology, Dragasevich would be going against the goals of FII and his own personal goals. FII would also have wasted money by spending 5% of its pre tax earningsIssue 3:Dragasevich's corporate goal, and one that is personal to him, was to prioritize FII's social and environmental responsibilities at all times, ensuring that FII's actions positively influence both the community and the environment. MBR's are the best environmental option available in the water filtration market. If Dragasevich decides to not invest in MBR's, he would...

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