Haier Taking a Chinese company global
For external analysis, China experienced growing economic development from late 1980s, which means demand outstripped supply in home appliance industry. Besides, China entered the WTO in 2001. Although Haier was faced with international competence, it also created more opportunities to infuse advanced technology and designs.
For internal analysis, Haier was dedicated to gain competitive advantages in domestic market. To start with, good relationship with government is a good point. Specifically, Haier was a collective enterprise whose ultimate authority was municipal government. It can enjoy the tax benefit at the beginning stage of development. Besides, Haier provided differentiated white goods. Haier is famous for its high-quality products with excellent brand reputation. In comparison with multinationals brand, Haier’s products are closer to Chinese needs and design. Continuous innovation was also taken into consideration to meet customer needs. Even though national and foreign competence was severe, Haier insisted single-brand approach. Haier, unlikely most other Chinese manufactures whose aim is only to export and earn foreign currency, became the pilot of OEM products. Its differentiated products served as protective factors that ensured continued profits. Moreover, diversification is another important element to be successful. From 1992 to 1998, Haier expand through merging with and acquiring other companies to enrich its product lines, such as refrigerator, freezer, air conditioner, and television. Equipped with Haier own management and quality control strategy, the newly expanded factories and subsidiaries maximize profit. Additionally, operational restructure and management change are of vital importance. In order to improve its own key competitive ability, Haier restructured the existing facilities into 7 product divisions in 1998 and improved significantly the company’s feedback speed from the market, reducing operating costs and increasing
For internal analysis, Haier was dedicated to gain competitive advantages in domestic market. To start with, good relationship with government is a good point. Specifically, Haier was a collective enterprise whose ultimate authority was municipal government. It can enjoy the tax benefit at the beginning stage of development. Besides, Haier provided differentiated white goods. Haier is famous for its high-quality products with excellent brand reputation. In comparison with multinationals brand, Haier’s products are closer to Chinese needs and design. Continuous innovation was also taken into consideration to meet customer needs. Even though national and foreign competence was severe, Haier insisted single-brand approach. Haier, unlikely most other Chinese manufactures whose aim is only to export and earn foreign currency, became the pilot of OEM products. Its differentiated products served as protective factors that ensured continued profits. Moreover, diversification is another important element to be successful. From 1992 to 1998, Haier expand through merging with and acquiring other companies to enrich its product lines, such as refrigerator, freezer, air conditioner, and television. Equipped with Haier own management and quality control strategy, the newly expanded factories and subsidiaries maximize profit. Additionally, operational restructure and management change are of vital importance. In order to improve its own key competitive ability, Haier restructured the existing facilities into 7 product divisions in 1998 and improved significantly the company’s feedback speed from the market, reducing operating costs and increasing