Business Essay Example on Haier Internationalization Strategy

Published: 2022-07-04
Business Essay Example on Haier Internationalization Strategy
Type of paper:  Essay
Categories:  Business strategy
Pages: 7
Wordcount: 1721 words
15 min read

The Haier Group is Chinese-based large household Appliances Company founded in 1984 and since then has registered tremendous growth to become internationally reorganized. The company in existence for around 20 years granted one of the most successful companies in China. Imperatively, amidst the tremendous growth registered existed some of the challenges to meet the international standards with regards to how best it can adopt the effective developmental strategies for the products and general services. With regards to the time frame, Haier Company, since 1990 has been employing a series of in the internationalization and general publication outside the nation. Notably, the in-depth analysis reveals that Heirs success in the global market is due to the ability to incorporate specific multinational management theories which have since then worked for the other companies in Korea, Europe alongside other American companies.

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The main features of Haier's internationalization strategy since early 1990

Between the 1900 and 2000 Haier group of companies sees the company through to the international recognition and massive expansion (Li 2018). Following the technical analysis, several strategies have since employed which acts as the key drivers behind the gigantic performances recorded in the international markets. It is imperative to note that, the Hairs group of companies relied on in cooperating the strategies which are solely driven by the global markets to help create the brand awareness and recognition to meet the consumers' needs and demands. One of the central focus of this paper majorly focuses on the how the company strategically employed the international entry strategies alongside the internal and the external strategies (Li 2018). Such strategies include:

Competitive Advantage

The massive increase in the use of electronic appliances among the consumers propelled active research in the Heirs group of companies to success. Adoption of the appropriate measures to help satisfy the consumer needs and demands (Hashai et al. 2014). The active involvement of the Haier's company in the active, innovative research to help avail the needed products both locally and internationally initiates a domestic competition before entering the foreign markets. On the other hand, advanced involvement in technology helps produce the demanded household appliances which raising the competitive advantages required as one of the prerequisite advantages in the global identity. The theory for the creation of the national strength has since created a sense alongside the taste in the global markets. Significantly, to maintain the competitive position of the customers, the company then opted to adopt some of the benefit-cost reduction strategies aimed at improving the customer's preferences as well as the computer lavage. Hair primarily focuses on building the famous brands to improve its quality products by entering the global markets by many customers. Similarly, the company generally understood the significant differences between the local and the international markets, following this technical analysis it then helps the company to compare the firms adequately and how it is often affected by the cultural, religious and the ethical disparities (Hashai et al. 2014).

The goal of Haier's internationalization

The chief strategic goals of Haier's internationalization process also involved producing products relevant to meet the consumer's daily demands as well as conservation of the environment (Bonaglia et al. 2007). On the first account, the ability of the Haier's company to fully integrate the demand of the local consumers, for example, the creation of the energy saving fluorine-free refrigerators which has not only met the environmental requirements but also has met the relevant demands of the local consumers. Besides, production of some warehouses to help boost sales is one guiding principle and relevant strategy which has massively increased the global realization of their products. The principal aim of adopting the internalization strategy only helps the relevancy in the domestic sale as well as the international status (Bonaglia et al. 2007).

The Haier's International Difficult Strategies

The successful opportunities observed in the company following a series of hard decisions such as dealing with the most pressing issues first. The adoption of the first mode strategy while entering the global market, on the first account, the company introduced the global market by dominating the international regions such as Europe, where it played an essential role in the international economic arena. Following this strategy, the company was then able to set full command to control the entire region with regards to its essential branding. Haier then used this strategy to establish its rules by using its branding as the most a prerequisite requirement to attain full control in the global markets.

(3) The policy of localization

In the bid to adopt the internationalization of the Hairs Company, the localization strategy seem to work positively and acts as a significant boost in the globalization of the company (Jones et al. 2005). It is imperative to note that, the localization of the foreign markets which includes setting up of the information centers, six design divisions and two industrial parks was majorly to develop the household appliances to help boost the local consumption. On the similar account, the company also adopted the strategy of establishing the foreign markets to help increase the sales of the products. Besides, the establishment of the factories in the foreign countries such as the United States was costly enough which then allowed the company to fully employ the localization strategy to gain the relevant information to further the establishment. In order successfully establish these factories, Haier Company then incorporated a series of technological advancement, as well as designing the products majorly for which fits the foreign consumers such as the United States. Significantly, the full establishment of the overseas factories also contributed to solving the anti-dumping of the Chinese company's right from the international company. Designing the products majorly for the which fits the foreign consumers such as the United States. Significantly, the great establishment of the overseas factories also contributed to solving the anti-dumping of the Chinese company's right from the foreign company (Jones et et al. 2005).

The Trinity strategy

The ability to set a significant station in the foreign countries helps the company expand rapidly to reach many customers like in the United States, Malaysia, Philippines. On the same account, the setting of the manufacturing plants created a significant boost in realizing a meeting the customers' needs and demands.

How Does Haier's Internationalization Strategy Differ From the Pattern of International Development of Western Enterprises?

The Haier's internationalization strategy entire focuses on introducing companies products on the foreign markets. The survival strategies which favored the foreign investment explored the underlying motive s which seems different from the patterns of developments in the international standards. Imperatively, as the company strives to meet the global standards, some of its strategies seem different from the international developmental approach hence poised massive challenges in the implementation of its agenda in the bid to compete for some of the global giants in the business. Notably, the Haier's company adopted the Uppsala model which allows the company to operate in a sequential model from low to high while entering the market. The massive exports of the products to the international markets also do not concur with the international regulations.

The adoption of the critical localization strategy which allows for the dispensation of the domestic modes of operation into the foreign market to creates a different environment in the western business platform. Similarly, the Trinity strategy which was significantly castigated globally to have gone contrary to the dumping policy tends to differ with the west of standards since it doesn't provide a useful guiding principle upon which the system is based (Child et al. 2005). On the same account, in a bid to capture the global standards Haier Company which rely mostly on the strategy of finding chinks some of the basic ideas on the international market segments often neglected. The international markets branded as ignored require the domestic companies to keep to the standards of the global market (Chan, 2011).

Contrastingly, the pattern of the western development policy following the technical analysis indicates a massive challenge. Besides, the assumption of the three-step strategy by the Haier Company of exploring the international markets with the modern technology poised a more significant problem with the western developmental policies. Significantly, Heirs strategy conflicted with the west of standards since it doesn't provide the negated measures to the industrial pollutants and the applicable mode of dumping (Child et al. 2005).

How successful has Haier's internationalization strategy been and why?

The international strategy for Haier has seen a greater success has been aimed at building a brand name as well as establishing deep understanding of the customers. The international strategy in this case further involved increased manufacturing of its products in China. Through this way, the company enjoyed the advantages of avoiding any substantial costs of establishing the manufacturing operations within the host nations. Primarily, the international strategy in this case can be referred to the Hill's Model that developed a Reduction/Responsiveness framework. Through this method, the comp-any could successfully differentiate between the available multinational strategies such as the localization, international, transnational as well as the global standardization (Chan, 2011).

The success of the company can further be attributed by the involvement in the export mode as part of its internationalization strategy. Notably, this mode can be divided into both the direct and indirect export. The direct export in this cases refers to the export through an independent organization in the manufacture company (Chan, 2011). This method is usually deemed appropriate for the companies with limited export experience as well as the common intermediaries involved in the process of export. Through this export mode, the company was able to receive a higher level of control through the distribution channels. It is important to note that the Haier Group began the process of exportation in 1986 until 2004. The total export reached an estimated value of $1 billion (Lu, 2009). The exporting enabled the company receive a tremendous marketing share within the international market and further facilitated the introduction of the Haier brand to the international customers. A closer look at this success would reveal that the company's strategy entailed entering the market a sequence of from the complex to simple market. It predominantly developed from the nations such as the Germany and the United States among other developing countries. The strategy involved the first export to Germans and expanding the practice to other regions after getting its market share. It further succeeded in changing a new image that prompted it to explore markets within the developing nations.

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