Business and Management
Submitted By jimmyyang29
Jimmy and Kevin
1) What is Haier Group
2) History of Haier Group
3) Product and Culture of Haier
4) Strategies of Haier
What is Haier Group
Haier Group is a Chinese multinational consumer electronics and home appliances company headquartered in Qingdao, Shandong, People's Republic of China. Its products include air conditioners, mobile phones, computers, microwave ovens, washing machines, refrigerators, and televisions. In 2011 the Haier brand had the world's largest market share in white goods, with 7.8 per cent.
Haier group is the world's fourth largest home appliance manufacturers, a Chinese brand with most value. Haier have been to 30 countries to establish the localization design center, production base and trading company, the global total employees are more than 50’000 people, It has become a large-scale multinational enterprise group, Haier group in 2007 has achieved turnover RMB 118 billion.
In August 2005, Haier was awarded by Britain's financial times "China top ten world-class brand". In 2006, in the Asian Wall Street journal organization selection "Asia top 200 enterprises", Haier group for the fourth year in a row on the "mainland China enterprise comprehensive leadership" charts. Haier has become a world-class brand ranks, its influence is with global market expansion and rapid rise.
History of Haier Group
The origins of Haier date are back long before the actual founding of the company. In the 1920s, a refrigerator factory was built in Qingdao to supply the Chinese market. After the 1949 establishment of the People's Republic of China, this factory was then taken over and turned into a state-owned enterprise.
Haier had been founded as Qingdao Refrigerator Co. in 1984. With China opening up to world markets, foreign corporations began searching for partnerships in China. One of these, Germany's Liebherr Group (Liebherr is the worldwide leader in premium refrigeration), entered into an joint-venture contract with Qingdao Refrigerator Co., offering technology and equipment to its Chinese counterpart. Refrigerators were to be manufactured under the name of Qindao-Liebherr. The installation of Liebherr's equipment and technology was accompanied by a new and rigorous commitment to quality. Combined with Zhang's disciplined management techniques, which broke from the tradition of the iron rice bowl in Chinese state-owned enterprises, the company began to turn around. By 1986, Qingdao Refrigerator had returned to profitability and sales growth averaged 83 percent per year. With sales of just CNY ¥3.5 million in 1984, sales rocketed to CNY ¥40.5 billion by 2000; a growth of more than 11,500 percent.
With the success of Qingdao's refrigerator company, the municipal government asked it to take over some of the city's other ailing appliance makers. In 1988, the company assumed control of Qingdao Electroplating Company and in 1991 took over Qingdao Air Conditioner Plant and Qingdao Freezer.
Having diversified its product line beyond refrigerators, the company adopted a new name in 1991. Borrowing from the German name of its partner, "Haier" came from the last two syllables of the Chinese transliteration of Liebherr. Qingdao Haier Group was further simplified in 1992 to Haier Group, the company's current name.
Its place in the domestic market secure, Haier moved onto the international stage with the goal of building a global brand name. The company opened a production facility in Indonesia in 1996, and the Philippines and Malaysia in 1997. The company tried to compete in the Thai market, but they completely lost to local electronics company and had to finish the marketing.
Haier's move into the U.S. market was cautious at first; it focused upon two niche markets in compact refrigerators and electric wine cellars. Both markets were underdeveloped, but Haier believed that they both had growth potential and were being largely neglected. The company's sales figures soon proved this belief correct, allowing Haier to firmly establish itself in its US niche.
With this success, Haier looked to make further inroads in the North American market by moving into the full-sized refrigerator category. This would bring it into direct competition with established American giants: GE, Whirlpool, Frigidaire, and Maytag. As part of its strategy, Haier decided to build a production facility in the United States at Camden, South Carolina, opened in 2000. By 2002, US revenues reached USD $200 million, small when compared to its overall revenue of $7 billion, but Haier set an ambitious sales goal $1 billion and 10 percent of the US refrigerator market.
Haier continued its expansion into other international markets as well. Production facilities were constructed in Pakistan in 2002 and Jordan in 2003, greatly strengthening its position in the Middle East market. In Africa, Haier has plants in five countries: Tunisia, Nigeria, Egypt, Algeria and South Africa.
The company also purchased a factory in Italy, as part of its continued drive into the European market. Haier has been successful in placing its products in most major European retail chains, either under its own brand or under OEM agreements with foreign partners.
Haier Appliances (India) P. Ltd initiated its commercial operations in January 2004. It was also listed among the top 20 most trusted brands in India by The Brand Trust Report, a study conducted by Trust Research Advisory.
In June 2005, Haier made a bid to acquire Maytag Corporation, backed by private equity funds Blackstone Group and Bain Capital. The bid was for USD $1.28 billion, or $16 per share, topping a previous offer of $14.26 per share made by Ripplewood Holdings. In the end however, Maytag was bought by Michigan based Whirlpool Corporation which offered $1.7 billion in cash and stock, or $21 per share, plus assumed debt.
As of 2008, Haier has surpassed rival Whirlpool as the world's top refrigerator producer in terms of sales, according to Euro monitor, an independent business intelligence provider. Haier said it sold 12 million refrigerators worldwide last year, up 20% over the previous year. Its market share reached 6.3% globally.
Product and Culture of Haier
· Home appliance · Communication · IT · Household
· Biological · Software · Logistics · Financial · Tourism
· Real estate · Electronic component · Digital home · Biological medical equipment
The core of Haier culture is innovation. It is from twenty years Haier development experience generation and forms into special culture system gradually. Haier culture takes the concept innovation as the pilot, the strategic innovation as the direction, organization innovation as the guarantee, the technical innovation as the means and the market innovation as the goal, with Haier from scratch, from small to large, from big to strong, from China to the world, Haier culture itself is in constant innovation and development. Staff's common identity, active participation is the biggest characteristic of Haier culture. At present, Haier's goal is “China's world famous brand, for our motherland”. The goal of the Haier development and Haier employee personal value pursuit are perfect match to each other, each Haier employee will fully realize personal value and pursuit in the process of realizing Haier world famous brand big goals.
Strategies of Haier
Graph: Haier development strategy innovation four stages
Brand strategy stage (1984-1991)
Features: Features: only do refrigerator product, explore and accumulated the enterprise management experience for future development, summed up a set of portable management mode.
Diversification strategy stage (1992-1998)
Features: From a product to multiple product development, from the white goods into the black home appliance field by Acquisition. In the shortest time and with the minimum cost to realizing the maximum the scope of the group.
(OEC management, including "O" on behalf of the Overall, "E" for Everyone , Everything , Everyday, "C" on behalf of the Control, Clear. OEC management can also be expressed as: the day's work to finish that day, cleaning and improve by every day.)
Internationalization strategy stage (1998-2005)
Product batch are sold to major global economic regional market. Have their own overseas dealer network and after-sales service network.
Globalization brand strategy stage ( 2006 - )
Features: Globalization brand strategy is in every country market create the local Haier brand. Haier implement global brand strategy is to improve the competitiveness of their products and the competitiveness of enterprise operation. And subcontractors, customers, users achieve win-win profit. From a single culture transition to a multicultural and realize sustainable development.
We have the Questionnaire answered by this report. And the Questionnaire as follows:
What are the management plans of Haier?
OEC management is practiced at Haier. In 1995 Haier’s OEC management was awarded the National Manage meant Innovation Advance Prize of China Enterprise Confederation. OEC management has attracted large attention in the Chinese business world and seen as one of the key factors of Haier’s success. After office hours workers check seven items of their jobs, that is, (1) job quantity (how many jobs are done), (2) defects in the jobs, (3) usage of parts and materials, (4) condition of jigs, (5) safety, (6) work attitudes and (7) work discipline. And they fill up the 3E card. 3E is the abbreviation of “Everyone, Everything and Every day.” After workers fill up the 3E card, they clean their work places. And they go home. Managers collect the 3E cards and check them. And they calculate wages of workers and show them on the bulletin board in the factory. It takes time to do this kind of paper work. So, it is not uncommon that managers work until 8 o’clock in the evening. Workers are evaluated every day based on the records of the 3E cards. Those with the best records are considered the best workers and those with the worst records are the worst workers.
The workers who are acknowledge as the best workers for consecutive three days have an honorary opportunity to tell their experiences for the workers. The workers who become the best workers most frequently in one month are considered the best workers of the month. They are given a better opportunity to have job training and social benefits. And, the workers who become the worst workers most frequently in one month are demoted to the trial workers. They will be fired unless they improve their records of the 3E cards. The other workers are considered good workers. Thus, there are three kinds of workers; the best workers, the good workers and the trial workers. Each worker is represented on the bulletin board with the mark showing the kinds of workers. The best workers have the red mark of smiling faces, the good workers have the green mark of faces and the trial workers have the yellow mark of wry faces. OEC management is practiced to managers, too.
What is the unique approach of the Haier forward itself to the future?
It’s the company’s culture, Haier culture itself is in constant innovation and development. Staff's common identity, active participation is the biggest characteristic of Haier culture. And also they have other approach which is to Meeting the demands of retailer customers faster than any competitor.
The company is self-managed units, every one of them, each devoted to a customer or group of similar customers. The units include employees at all levels from the usual functions -- design, manufacturing, marketing, and so on. Members who work directly with customers make all the decisions; managers are there only to make sure the unit gets what it needs. But If the members of a unit don't like the way their manager is performing, they can vote him out. Each unit regards itself, and is evaluated, as an independent business earning a profit or loss.
What are the strategies of Haier?
They have the strategies in stage, which for now is Globalization brand strategy is in every country market create the local Haier brand. Haier implement global brand strategy is to improve the competitiveness of their products and the competitiveness of enterprise operation. And subcontractors, customers, users achieve win-win profit. From a single culture transition to a multicultural and realize sustainable development.
And it’s the stage of them use T-model.T model, the so-called T that Time, Target, Today, Team. In a specific point to realize enterprise supply value and customer demand with the value of the butt. T model is very easy-to-use a time management tool. But, haier T model is different; it is the date of production of goods for T. T model requirements in order T - 30 be sure, that is to say that 30 days before the order is determined the market demand after 40 days.
What are the major accomplishments of the Haier?
What is the general reputation of Haier?