This Case is about CHANGE MANAGEMENT

PUBLICATION DATE: November 22, 2012 PRODUCT #: IES340-HCB-ENG

Established in 1984 by Zhang Ruimin, present CEO of the business, Haier has quickly grown to an international leader in home appliances, from a tiny fridge plant in Qingdao, China. As among the very valuable brands in China, Haier produces designs and sells various home appliances including air conditioners, fridges and washing machines in over 100 nations. Since 2006, its international presence has vigorously expanded, planning to turn each brand that was localized into a mainstream product in its specific marketplace. Haier had consistently encouraged a performance-driven culture stressing meritocracy and individual duty. Lately, Haier formed a management system comprising of an inverted organizational triangle with self-managed units. This construction put staff in direct contact with the clients and empowered them to take initiative to serve the marketplace as an alternative to reacting to orders from a supervisor. Furthermore, if their performance was not inferior, young talent might be readily promoted to higher positions than more-tenured colleagues. Nevertheless, Haier confronted the challenge of the system being at odds with the Japanese custom of lifelong employment, seniority and equality. Thus, Japanese workers had trouble not only understanding but also executing this revolutionary system.

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