Acer Case Study

2987 words - 12 pages

Question 11. Analyse Acer's situation.First, to conduct this analysis I am going to develop in-depth the SWOT analysis which I consider to be the most representative and the one that outlines the most important aspects of a company.Secondly, I will use the Poter's five forces framework which aims to identify the competitive background of a company.SWOT analysis summarises the key issues from the business environment and the strategic capability of an organisation that are more likely to impact on strategic development (P 148, Johnson G. et al.).StrengthsPrivilege position in its markets. Acer has become a very competitive company in the IT world. For example: it is the "fifth computer ...view middle of the document...

..lower inventory costs" (ACSP 222). Another consequence of Acer's strategy is its diversification within the different markets.Flexibility. The company is very flexible because it can act in many different countries depending on specific characteristics, and it is able of satisfying demand by using national suppliers. "The flexible client server business model...responding to the trend toward increased dispersion and local autonomy" (ACSP 224). Furthermore, its subsidiaries constantly update relevant market information with the aim of acting when new products or market changes are required. "This structure allowed for faster decision making" (ACSP 224).Short turnaround time. "The turnaround time from idea to market dropped to only one or two months" "The high turnover aided Acer in achieving a 34% return to equity" (ACSP 222). Thanks to this, Acer can offer the freshest (newest) products before any other company.Taiwanese IT industry. IT Taiwanese companies have several advantages if we take a look to its environment. For example: "Taiwan's aggressive technology programmes, such as cheap government advantages and government funding for innovative R&D". (ACSP 219). And Taiwanese IT industry is dynamic and cost effective; one reason is that there is a talented and cheap workforce. "About 60% of Taiwan's university population consisted of science and engineering students...44% in Korea and 32% in Japan". (ACSP 219).Human resources management. Two important facts related to this subject are: Employees' involvement in the company. "Employee ownership in the company in 1995 accounted for about 30%" (ACSP 226). And efficient internal communications because there is "Good communication between managers: regular summit... communication and consensus in decision making" (ACSP 227). They enhance company performance and increase staff motivation.Spirit of innovation. Acer is considered one of the most innovative companies, "The firm had achieved a reputation for innovation" (ACSP 218), due to its "Engineers, are always willing to rise to the challenge of any new technology which might take the company to the front" (ACSP 226). This is why the company hails of its slogan "Fresh technology enjoyed by everyone, everywhere" (ACSP 226).WeaknessesTaiwan's image problem. Taiwanese industry is perceived as not as a quality products supplier. For instance: "Taiwan's reputation is for low-end products", "Consumers not believe a Taiwanese company capable of sophisticated technology" and "Made in Taiwan" has a low quality and low price perception. (ACSP 219). This affects company's quality image.Image problem. The customers are not aware of Acer's brand name. "The company still suffering from low brand awareness in the US despite its top-ten position".Cultural differences between its national and international staff. "Outsiders sometimes found difficult dealing with the intricacies of Acer's organisation" and "People from advanced countries tended to...

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