HERMAN MILLER

A CASE OF REINVENTION AND

RENEWAL

Introduction

American Company
Major manufacturer of office furniture, equipment
and home furnishings.
1.3 Billion dollar global company
Known for its innovation in products and
processes.
Only non-high technology organization on
Fortunes 100 best companies to work for and
most admired companies.
Distinctly marked for its reinvention and renewal.

Background

Established in 1905 as the Star Furniture Company

Based in Zeeland, Michigan.

Purchased by D.J. De Pree with the help of his Father

in law Herman Miller in 1923.

The companys name was changed to Herman Miller

after the purchase

Produced its first office furniture in 1942

Background

Expanded internationally in the 1950s (European

market)

In the 1960s, created the Action Office System

Worlds first open-plan modular office arrangement of

movable panels and attachments

In1970, became a public traded company

In the 1980s, Equa chair was named design of the

decade

Background

Became environment friendly in 1990s

Founding member of Tropical Forest

Foundation

Herman Miller Home was launched in

1994

9/11 caused 38% of the company to be

laid of

SWOT

Strengths

Brand Name and recognition

Green Marketing and Community work
Customer Loyalty
Well designed and executed strategy
Strong financial position
Constant innovation
Team Work
Employee Transparency and inclusiveness

SWOT

Weaknesses

Low sales and profits

Benefit cuts and Lay ofs

Rising debt to equity ratio

Financial struggle

R&D Department

SWOT

Opportunities

Online Market

High demand of ergonomic furniture

High Demand for environment friendly

furniture

Expansion into emerging markets

internationally

SWOT

Threats

Intense Competition
Bad Economy
Substitute products
Consumer taste and change in trends
Technological advancementtelecommuting
Change in the cost of raw material

Strategy

Corporate Level Strategy

Growth Strategy
Diversification

Business Level Strategy

Low cost

Structure and control system

Shared Leadership: talking up and
down the ladder
Transparency and full disclosure
Employee Empowerment
De centralized Control
Profit sharing program : stock
sharing
Promotion from with in

Structure and control

system
Participative management style
Cross functional Teams
HMPS (performance system):
minimizing efficiency by minimizing
inventory on hand through just in
time
Cooperative advertising with
strategic partners

Recommendations

Continue using the same strategy

Survived economic recessions on the current

strategy

Serious overhauling of HR practices:

designed for a diferent time in the market
Work on home office strategy
Heavy investment in R&D

Create a team for forecasting emerging

trends or possible downturns

Recommendations

Portfolio diversification:

Academics
House electronics
Health care

Improve relations with suppliers:

contract based work
Partnership with companies
Strengthen financial practices

Recommendations

Marketing campaigns

Stronger marketing department

Celebrity endorsements
Green initiative
Bank on CSR

Expanding into un tapped markets

Middle East