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  • Subject Name : Management

Haier Group- Internationalization Strategy

Main Features of The Internationalization Strategy

The CEO's approach for a sequential plan with organization setup for expansion with aggressive sales using local operating approach and dominance created HAIER’s success. The 7 years strategy plan was drawn.

  • Haier entered several markets between the period 1992 and 1997. The primary objective was to build a brand and not seek revenue. It helped in acquiring local market
  • The approach for the product was locally designed, made, and sold that included using local distributors, establishing plant and research, and allied activities.
  • Haier used technical executives for foreign operations
  • Haier used global developed market for expansion of products through brand building and improvement in customer service and product development.

Strategy Difference Between Haier and Western Enterprise

They set up own companies for operations and choose developing countries for the setup of distribution centers for each product. Haier picked string markets for expansion and then developed expansion in developing countries. The export strategy through operational house and localization is not followed by western enterprise.

Analysis of Haier Implementation Strategy

  • Haier sold the same products globally but focused on differentiation for innovation. Haier focused primarily on refrigerators
  • Haier s approach was different from other companies as they used local distributors instead of establishing own marketing channel
  • The enterprise transformed to open system with mutually creative connections outside contributors.
  • Customer satisfaction is the prime focus of products designed to solve customer problems. The venture with GE gave R&D leverage to the company. Employees were transformed towards contributors with the flexibility to elect their team

Haier's strategy has been successful and it has become one of the leading domestic alliance companies. Haier's decentralized structure in management helped in decay making and team building for successful execution. Haier has acquired market percentage in the Asia Pacific, America, and Europe. It expands through technology spin-off through a joint venture. Forming technological alliances globally and USA Market tie-up with no branding leverage has established a self-operated research Centre for development for the area other than the home country.

Principle Features of The Management System

The early focus through CEO Zhang to build quality management with principles of marketing for international relationships strengthen it'd distributors and operations in a foreign country. The use of digital technology for communication and performance management with the OEC principle. The assent and decentralized structure gave individual autonomy to staff. The western companies focus on standardization and more focus on establishing operations than local technology spin-off

The lesson for Chinese and western enterprises

  • Product focused internalization strategy with marketing through the local supplier network
  • Increase investment in R%D for competitive advantage and decentralization for faster decision making and focus on personal leadership and intrinsic motivation
  • A product-focused international market entry strategy was followed by Haier.

Recommendation for Haier and western buyer competition

  • The group has used a strategy for implementation effectively. It can use the transfer of technology and innovation to building across the globe by strategic alliances by local suppliers support
  • The group can use marketing and brand awareness to dominate in new markets as the competition is tough from western competitors strong brand image than Haier
  • Haier has a lack of experience with a performance at par can be consummative through branding from support by the Chinese government and company. The R&D support will help them to excel at the competitive level and increase in dominance in the market by innovation as the role of a pioneer when it has moved out of china
  • To display consistency the research support is essential for survival. The limited resource can be improved through the partnership as discussed in the previous point. To counter to a reputed brand product does justice and ensure it is essential. The localization of resources is critical to success by the case scenario discussed with the time frame from early 1990. The export stage can be improved with a new market and prescreening with the developed plan. Marketing and advertising through influential marketing and innovation as fast-moving chain establishment
  • Distinctive product appeal is refreshing, the products require fine-tuning for global appeal and dominance for the next 5 years

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