Case ApplicationPoge @Poga ®Higher and Higherhurts Chinese brands, with the biggest challenge toChinese companies being to change the impression ofChinese products as cheap, poor value, poor quality, andYou may not be familiar with the Haier Group (soundslike "higher"), but if you've ever shopped for a refrigera-tor, microwave, wine cellar, or air conditioner at Wal-Mart, Bed Bath & Beyond, Lowe's, Home Depot, orTarget, you've undoubtedly seen, if not purchased, thecompany's products. And Haier's name surfaced in U.S.business news headlines in late 2005, when it made a bidto purchase domestic appliance maker Maytag. Today,Haier exports its products to more than 160 countries andregions, and its annual revenues are over $12 billion.Haier Group is China's largest home-appliance makerand CEO Zhang Ruimin has ambitious goals for his com-pany. Whereas the United States has General Electric,Germany has Mercedes-Benz, and Japan has Sony, Chinahas yet to produce a comparable global competitor.Zhang is hoping to change that. Haier enjoys enviableprestige in China (a survey of "young, fashionable"Chinese ranked Haier as the country's third most popularbrand behind Shanghai Volkswagen and Motorola, withCoca-Cola fourth), but Zhang isn't satisfied. He wants togain worldwide recognition, build the company intoChina's first truly global brand, and be listed on theFortune Global 500. But accomplishing those goals maymean losing the "Chinese-ness." In an online surveyconducted in 2005 by Interbrand, 79 percent of therespondents believed that a "made in China" labelunreliable.The Haier Group started as the Oingdao RefrigeratorPlant. When Zhang took charge of the government-controlled company in 1984, his first action as CEO was totake a hammer and smash 76 refrigerators because of theirpoor quality. Why? To drive home the point that productquality was going to improve. At that time, the companyhad only one product and 800 workers. Today, the com-pany has over 50,000 employees in various locations mak-ing some 15,000 different products in over 96 categoriesranging from air conditioners to mobile phones to vacuumcleaners and more. It has manufacturing facilities in13 countries including the United States and throughoutEurope, the Middle East, Africa, and South Asia. In addi-tion to its manufacturing facilities, Haier has 18 researchand development and design centers around the world.On average, Haier innovates 1.3 new products per day.Continuous innovation is the soul of Haier's corporate cul-ture. And the company's products are now known aroundthe world for quality and innovation.In Zhang's push to make the brand global, Haierbegan sponsoring an Australian basketball team nowknown as the Melbourne Haier Tigers. It also recentlysigned a sponsorship deal with the Wests Tigers RugbyLeague team in Australia, and has become the marketingPoge partner of the NBA in the United States. And in itsbiggest strategic coup of all, the Haier Group has beenselected as the official home-appliances sponsor of theBeijing 2008 Olympic games. This type of exposure islikely to go a long way toward Zhang's strategic goal ofbecoming a truly global brand.DISCUSSION QUESTIONS1. What competitive advantage(s) do you think the HaierGroup has? What competitive strategy does the com-pany appear to be following? Explain your choices.2. What strategic goals does Zhang have for Haier? Dothe company's strategies appear to be helping itreach these goals?3. How might SWOT analysis be useful to Zhang Ruimin?4. What other strategic management concepts mightZhang use to help him continue managing the HaierGroup for successful performance?5. What strategic leadership characteristics does ZhangRuimin exhibit? Explain.

Question

Case ApplicationPoge @Poga ®Higher and Higherhurts Chinese brands, with the biggest challenge toChinese companies being to change the impression ofChinese products as cheap, poor value, poor quality, andYou may not be familiar with the Haier Group (soundslike &#34;higher&#34;), but if you've ever shopped for a refrigera-tor, microwave, wine cellar, or air conditioner at Wal-Mart, Bed Bath & Beyond, Lowe's, Home Depot, orTarget, you've undoubtedly seen, if not purchased, thecompany's products. And Haier's name surfaced in U.S.business news headlines in late 2005, when it made a bidto purchase domestic appliance maker Maytag. Today,Haier exports its products to more than 160 countries andregions, and its annual revenues are over $12 billion.Haier Group is China's largest home-appliance makerand CEO Zhang Ruimin has ambitious goals for his com-pany. Whereas the United States has General Electric,Germany has Mercedes-Benz, and Japan has Sony, Chinahas yet to produce a comparable global competitor.Zhang is hoping to change that. Haier enjoys enviableprestige in China (a survey of &#34;young, fashionable&#34;Chinese ranked Haier as the country's third most popularbrand behind Shanghai Volkswagen and Motorola, withCoca-Cola fourth), but Zhang isn't satisfied. He wants togain worldwide recognition, build the company intoChina's first truly global brand, and be listed on theFortune Global 500. But accomplishing those goals maymean losing the &#34;Chinese-ness.&#34; In an online surveyconducted in 2005 by Interbrand, 79 percent of therespondents believed that a &#34;made in China&#34; labelunreliable.The Haier Group started as the Oingdao RefrigeratorPlant. When Zhang took charge of the government-controlled company in 1984, his first action as CEO was totake a hammer and smash 76 refrigerators because of theirpoor quality. Why? To drive home the point that productquality was going to improve. At that time, the companyhad only one product and 800 workers. Today, the com-pany has over 50,000 employees in various locations mak-ing some 15,000 different products in over 96 categoriesranging from air conditioners to mobile phones to vacuumcleaners and more. It has manufacturing facilities in13 countries including the United States and throughoutEurope, the Middle East, Africa, and South Asia. In addi-tion to its manufacturing facilities, Haier has 18 researchand development and design centers around the world.On average, Haier innovates 1.3 new products per day.Continuous innovation is the soul of Haier's corporate cul-ture. And the company's products are now known aroundthe world for quality and innovation.In Zhang's push to make the brand global, Haierbegan sponsoring an Australian basketball team nowknown as the Melbourne Haier Tigers. It also recentlysigned a sponsorship deal with the Wests Tigers RugbyLeague team in Australia, and has become the marketingPoge partner of the NBA in the United States. And in itsbiggest strategic coup of all, the Haier Group has beenselected as the official home-appliances sponsor of theBeijing 2008 Olympic games. This type of exposure islikely to go a long way toward Zhang's strategic goal ofbecoming a truly global brand.DISCUSSION QUESTIONS1. What competitive advantage(s) do you think the HaierGroup has? What competitive strategy does the com-pany appear to be following? Explain your choices.2. What strategic goals does Zhang have for Haier? Dothe company's strategies appear to be helping itreach these goals?3. How might SWOT analysis be useful to Zhang Ruimin?4. What other strategic management concepts mightZhang use to help him continue managing the HaierGroup for successful performance?5. What strategic leadership characteristics does ZhangRuimin exhibit? Explain.

Accepted Answer

Haier group is a home appliances company that has been growing very fast in recent times.