Question

In: Operations Management

What are firm strategy options in the drone industry and how are these firm strategies likely...

What are firm strategy options in the drone industry and how are these firm strategies likely to affect the emergence of the drone industry?

Solutions

Expert Solution

Drone market can be described as the melting pot of difgferent technologies like hardware, software etc. In all over the world the indutsry has greatest potential and opportunity. The current international commercial drone market is $10bn and is expected to reach $17bn by 2024. Different cutting edge technologies are required in drone so the players have limited strategy to grow in the market. Partnership is a key strategy. Various upstream and downstream companies making drone can come into a partnership by joint venture, joint development of hardware and software. It can increase the synergy between the companies and get cost effectiveness in the market. The market has seen partnership like Intel and Ascending Technologies.Another strategy which can be used is acquisition of the dominant player(s). Through acquisition larger market share can be captured and remain relevant in market. Intel and Parrot are increasing their footprint through acquisitions.

These firm strategies can increase the market size of drone industry vis-a-vis firm. It can create more space for industry and small players can be eliminated through the process.


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