CONTENTS
VISION......................................................................................................................................2 MISSION...................................................................................................................................2 INTRODUCTION ....................................................................................................................3 SWOT ANALYSIS ..................................................................................................................4 STRENGTHS........................................................................................................................4 WEAKNESSES.....................................................................................................................4 OPPORTUNITIES.................................................................................................................4 THREATS..............................................................................................................................4 STAGE 1 “INPUT STAGE”................................................... ........................... ................... ................ ............. .....5 5 EFE MATRIX........................................................................................................................6 CPM.......................................................................................................................................7 IFE MATRIX.........................................................................................................................7 STAGE 2 “THE MATCHING STAGE”...................................................................................9 SWOT MATRIX.................................................................................................................10 SPACE MATRIX................................................................................................................11 BCG MATRIX.....................................................................................................................12 IE MATRIX.........................................................................................................................13 GRAND STRATEGY MATRIX.........................................................................................14 STAGE 3 “THE DECISION STAGE”....................................................................................15 QSPM MATRIX..................................................................................................................16 RECOMMENDATIONS.........................................................................................................17
1
VISION “Innovative products that will transform, the customers every day living into inspired living”
MISSION Our mission is to combine quality, innovation, and style for the comfort and convenience of your home. At Haier, we are committed to paving a new path. We are at the forefront of the next wave of home appliances and consumer electronics and have made a conscious effort to design and develop high-end and high-quality products. As our growth continues, we will surpass the challenges presented by new markets while maintaining the quality and dependability that our customers have come to associate with Haier . Our offerings are constantly expanding and evolving as we strive to create products that allow consumers to lead better and healthier lifestyles.
2
INTRODUCTION COMPANY HISTORY
Haier was incorporated in 1984 only producing household refrigerators. Over the past 20 years, the company has witnessed significant prosperity and is now a transnational organization widely recognized in the world community. Haier currently manufactures a wide range of household electrical appliances, 15,100 varieties of items in 96 product lines, and exports products to more than 100 countries. In 2004, Haier’s global sales hit RMB100.9 billion and Haier brand, valued at RMB61.6 billion, topped all Chinese trademarks at a nationwide survey. Haier was ranked first in the row of China’s Top 10 Global Brands August 30, 2005 on the Financial Times. Haier CEO Zhang Ruimin was placed 26th of the World’s 50 Most Respected Business Leaders on 17th November, 2005 on Financial Times. Zhang Ruimin was ranked 6th of the Asia’s 25 Most Powerful People in Business on Fortune in August, 2004 and first of the 25 Most Powerful Business Leaders inside China on the Chinese Edition of Fortune in April 2005. Haier’s international promotion framework encompasses global networks for design, procurement, production, distribution and aftersales services. Haier has established 15 manufacture complexes, 30 overseas production factories, 8 design centers and 58,800 sales agents worldwide. From Zhongyikang Statistics, Haier’s leadership position in Chinese home appliance industry has been solidified by obtaining the domestic market share of 21% for overall appliances, far ahead of all its competitors, 34% for white goods, exceeding globally recognized domination line, and 14% for small electric appliances, overtaking all previous competitive rivals. In the world market, Haier has gained first place in the United States for sales of compact refrigerators and wine coolers, in Iran for washing machines and Cyprus for air conditioners. From Euro-monitor Statistics, Haier is currently ranked fourth among the global white goods makers by revenue and Haier’s goal is to play a leading role in the world white goods industry.
3
SWOT ANALYSIS
STRENGTHS Maintaining high quality Savvy management team, unique corporate culture, qualified employees, core technology, excellent after-sale service system Diversified product line High reputation and brand image
WEAKNESSES Relatively high cost Lack of communication between firm and retailers. Competitive edge is not communicated to the customers. More attention on traditional electrical products
OPPORTUNITIES Increasing demand for home appliances Free trade agreements Economic globalization - “go out” Core technology Domestic and foreign business partners
THREATS Fierce competition in target market Change of consumer taste Shift in technologies “Energy saving” “environment protecting” “green” Stronger competitors
4
STAGE 1
“INPUT STAGE”
EXTERNAL FACTOR EVALUATION (EFE) MATRIX COMPETITIVE PROFILE MATRIX(CPM) INTERNAL FACTOR EVALUATION(IFE) MATRIX
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EFE MATRIX
KEY INTERNAL FACTORS
Wt
Rate
Wt. Score
0.11 0.09 0.10 0.08
4 2 3 2
0.44 0.18 0.3 0.16
0.09
3
0.27
0.10 0.11 0.13
3 4 4
0.3 0.44 0.52
0.07 0.12
2 4
0.14 0.48
OPPORTUNITIES:
Increasing demand for home appliances Free trade agreements Economic globalization - “go out” Core technology Domestic and foreign business partners
THREATS
Fierce competition in target market Change of consumer taste Shift in technologies “Energy saving” “environment protecting” “green” Stronger competitors
1.00
6
3.23
CPM
CPM
whirlpool
Haier
General
SCHWEPPES
Critical Success
Weight
Rating Score Rating Score Rating Score
Factor
1 Advertising
0.20
1
0.20
4
0.80
2
0.40
Product Quality
0.10
4
0.40
4
0.40
3
0.30
Price Competition
0.10
3
0.30
3
0.30
4
0.40
Management
0.10
4
0.40
3
0.30
3
0.30
Financial Position
0.15
4
0.60
3
0.45
3
0.45
Customer Loyalty
0.10
0.40
2
0.20
0.20
0.80
4 2
0.40
Global Expansion
4 4
0.40
2
0.40
Market Share
0.05
1
0.05
4
0.20
3
0.15
Total
1.00
3.15
IFE MATRIX 7
3.25
2.60
KEY INTERNAL FACTORS
Wt
Rate
Wt. Score
0.14 0.13 0.12 0.15
4 3 3 4
0.56 0.39 0.36 0.6
0.13 0.12
4 3
0.52 0.36
0.11 0.10
2 2
0.22 0.2
STRENGTHS
Maintaining high quality Savvy management team Diversified product line High reputation and brand image
WEAKNESSES
Relatively high cost Lack of communication between firm and retailers Competitive edge is not communicated to customers More attention on traditional electrical products
the
1.00
8
3.21
STAGE 2 “THE MATCHING STAGE”
SWOT MATRIX SPACE MATRIX BCG MATRIX IE MATRIX GRAND STRATEGY MATRIX
9
SWOT MATRIX STRENGTH Maintaining high quality(s1) Savvy management team, unique corporate culture, qualified employees, core technology, excellent after-sale service system (S2) Diversified product line High reputation and brand image(S3)
WEAKNESSES
OPPORTUNITIES Increasing demand for home appliances(O1) Free trade agreements(O2) Economic globalization - “go out”(O3) Core technology (O4) Domestic and foreign business partners(O5)
SO STRATEGIES Launch aggressive marketing campaign(s1,s2,s3,o1,o5)
WO STRATEGIES Joint ventures with Asian competitors(w1,w3,o5) Introduce innovative products(w4,o3)
THREATS Fierce competition in target market(T1) Change of consumer taste(T2) Shift in technologies(T3) “Energy saving” “environment protecting” “green”(T4) Stronger competitors (T5)
ST STRATEGIES Introduce new low cost high standard products(s1,t1,t4)
WT STRATEGIES Issue shares and launch frequent products (w4,t5)
10
Relatively high cost(W1) Lack of communication between firm and retailers.(W2) Competitive edge is not communicated to the customers.(W3) More attention on traditional electrical products(W4)
SPACE MATRIX
11
BCG MATRIX
12
IE MATRIX
13
GRAND STRATEGY MATRIX
14
STAGE 3 “THE DECISION STAGE”
QUANTITATIVE PLANNING MATRIX (QSPM)
15
QSPM MATRIX
16
RECOMMENDATIONS
HAIER should invest more in research and dev elopment Must find new markets and niches with in old markets Must follow KIZAN and work for continuous improvement Need to introduce new standardized and low cost products Work for improvement in current products and offerings Frequently introduction of new products is necessary because without it cannot compete. Work for joint ventures where sole operations are expen sive Use business process reengineering for the radical and dramatic improvement and desired results. Strategic planning is key to success in present world ,HAIER must focus on future and introduce products that are congruent with future and present need of customers and market.
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