To what extent does the internal environment of "Haier Company" enable it to survive and prosper in a global knowledge economy? IntroductionThe business world in changing in this new era where there is an outpour of information and knew knowledge. The contribution of technology, globalization and information technology cannot be emphasized; beyond how it is evidenced to influence the operation of today’s companies. This issues have brought in the concept of the knowledge economy; an economy that depicts great capacity to learn through the work processes; learning on how to use newer approaches to tasks to better the output.
An economy that has fully embraced innovation, not as a just as a value but as a skill that is put to use to boost performance and therefore, it enhance competitive advantage of an organization against its competitors (IMF 1997 p. 43-54). The new knowledge economy requires that organizations have to come up with newer strategies to speed up decision making processes so as to gain a competitive edge in the market. The global market has changed to the extent that if companies have to survive in the market, they have to offer timely response to their customers as well as their employees (Bairoch 1993 p. 49-63).
This research will examine these and other issues that revolve around the knowledge economy, with regard to the internal factors of Haier Company. Executive SummaryThis research paper has discussed a number of issues related to the global knowledge economy; and with particular regard to the relevance of the internal environment in Haier Company that has made it survive in the global knowledge economy. The paper has covered the details about the background of Haier Group Company; it has outlined the global knowledge economy concept also the internal environment challenges, and corporate revival of the company.
Additionally, the research has encompassed an analysis of the internal environment of Haier Company and its contribution to its survival of in the global knowledge economy. Finally, it has a conclusion that captures the concepts discussed through the research. Background to OrganizationHaier Company is a China based multinational company that deals with the production and sale of home appliances electronic tools and equipment.
The company has situated its headquarters in Quigdao, Shandong, found in the People’s Republic of China. Over the years, the company has engaged itself in the production, sale and distribution of home appliances such as the washing machines, refrigerators, air conditioners, televisions among other home appliances. Currently, in white goods the company has developed the Haier brand to be the largest market share in the globe; maintaining a 6.1 per cent share value last year . The origin of Haier as a company is traced back long before it was actually founded as a company.
In the year 1920 a factory that produced refrigerators was built in Quigdao to supply the refrigerators to the Chinese market then. In the year 1949, just after the establishment of the People Republic of China, the company was taken over by the state therefore; it became a state owned enterprise, though the employees as well as individuals owned some shares in it. A study into the ownership structure reveals that the company though still under partial public ownership, the company is still technically a collective company in which the employees are supposed to own it.
A detailed look into the company, exposes the fact that the actual ownership of the company is opaque for the employees do not receive the dividends and are ignorant of the share of the company that they are said to own in reality (Haier Group Company Overview 2004, p. 4). Being a state owned enterprise, the interference by the officials has been a great risk to Haier Company. The various levels of Governments previously have pushed ailing companies upon successful ones; and this affected Haier Company at once, where it was said to acquire a pharmaceutical company, yet it had neither prior infrastructure in biotechnology nor experience in this field (Danzon 1997, p. 44-57).