Situation Analysis (Looking for an opportunity)
The location clearly indicated from the perspective of Mr. Lin that China was one of the fastest developing countries around the world. It is involved in an emerging market expansion rather than going towards the selected industry players. He said that an opportunity has arrived under which, we can prove what we possess in orderto fulfill the third world’s market needs.
The third world, in this scenario consisted of villages and other small territories where ACER could boost their presence and make it a successful company,in that country by continuously focusing on their business expansion. On the other side, we wouldalso be able to increase the relationships, politically as well as economically. Therefore, under particular circumstances, an opportunity could be executed by focusing on controlling the external barriers and then allowing to increase its operational controls.
In this sense, the internal opportunity could be to increase the Chinese workforce within a new project because they provide cheap labor with minimum wages. In contrast, there are more threats imposed on ACER as compared to the highlighted opportunities. In this regard, Lin should critically evaluate the opportunity and determine the process of the outcome in an efficientmanner, and that would achieve the mission as defined by Lin himself.
Need to focus on China’s market
There arevarious consequences of entering China’s mainland, that couldaffect ACER. The first advantage that ACER could implement,would be the fact that it has a strong,thorough understanding of china’s culture, that could allow managing the operational flow of the business in a proper way. Secondly, many foreign investments could take advantage of the emerging economies like China to increase their revenues and other benefits. Thus, looking towards the recent trend, Lin decided to focus on the manufacturing concern in China.
In addition, another advantage that ACER could take was that China was offering tax cutting over manufacturing operations based on electronic industry perspective. In the first two years, tax was exempted entirely, not allowing any entity to pay, unless a 50% cut would be granted in the third year. Taking this advantage, ACER could reduce the cost of operations and manage the revenues and profits in a proper manner if it would focus more on niche market instead of an established one.
Moreover, there was another advantage for MR. Lin that was reducing an overall wage rate. The pay rate in China was petite(One-tenth of Taiwan’s worker rate) and could allow the business to expand with minimum operational cost to bear overtime. So, these are the main reasons why ACER was desperate to establish manufacturing operations in China.
Build motivation towards the new workforce
To achieve the contribution of the new laborforce, ACER could implement the culture of rewards and recognition because, in China, workers were demotivated bylimitations of fixed wages with no compensation on jobovertime. Also, thegovernment allowed the work to be done in extra time instead of providing flexible working hours. This sort of traditional culture could allow ACER to be implemented in China, but in a different way. It could motivate the new workforce by external rewards like attractive salaries for employees and workforce around the country. Another option that ACER could implement, would be to pay bonuses on performance and overtime,by the related laborforce. If this sort of scenario would performcorrectly, then it can be said that the operational efficiency of the new manufacturing operations would be achieved and allowed to increase the business expansion within China overtime………………………
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