Essay on Dynamics of Strategy - Haier Case Study

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Dynamics of Strategy Assignment Author [ID: XXXXX] June 2013 Word count: 3294 Table of contents 1. Summary 3 2. Haier's strategy analysis (Part A) 4 2.1 Haier's strategy overview 4 2.2 Macroenvironment analysis 5 2.3 Industry analysis 6 2.3.1 Key points of the industry analysis 8 2.4 Industry key success factors (KSFs) 9 2.5 Internal analysis 10 2.6 Points on KSFs and internal analysis 14 2.7 Dynamic context 14 2.8 Purpose and stakeholders perspective 15 3. Recommendations (Part B) 17 4. Appendices 20 5. References 23 6. Assignment instructions 25 Summary This report provides an in-depth analysis of the strategic steps taken in Haier India using the B835 module frameworks. The…show more content…
The annotated diagram below illustrates the factors relevant for Haier in India and overlaps are observed. For example: although the threat "heavy tax burden at multiple levels" is identified as economic factor, it is also relevant to be political or legal factor. Opportunities identified by economic (e.g. low penetration electronic products) and sociological factors (e.g. more nuclear families) lead to likelihood of increased demands for Haier's products. The threat highlighted by the political factor (unavailability of suitable road infrastructure to rural India) is challenging to counter involving government bodies and of high-cost. It is not clear from the case study why the Indian government is delaying infrastructure projects although the economic and sociological factors indicate growth (e.g. 8.3% growth in GDP, more nuclear families, rising disposable income) generating more revenues. Applying Johnson's test of suitability, none of the strategies outlined above (Section 3.1) overcome this threat. The "inverted duty structure" is another threat Haier need to respond to since it results in inflated prices for goods. The localisation strategy seems to counter this (applying feasibility test) although it is not clear if Haier's strategy goes as far as "fully local", i.e. manufacturing parts locally using local raw materials
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