1) Rank the importance of Galanz’s operations objective of cost, quality, flexibility,
delivery, service and innovations. How has the importance changed over years?
2) What are Galanz’s competitive and operations strategy and how does the
operations strategy support its competitive strategy?
3) Should Galanz develop its OBM business in International Market? Should Galanz
continue its OEM and ODM business?
4) What should Mr. Liang do to lead his company to greater success? Should it
change its overall cost leadership strategy? How should the company change the
priorities and utilize resources and capabilities to gain competitive advantage in
Galanz Enterprise Group Co. Ltd (Galanz) is a Chinese company found in 1978 by Liang
Quingde, headquarter located in Shunde Guandong which was initially started with few
number of workers producing feather product and rely on foreign exchange in exporting its
product. The company has been turned into a world-class manufacturer of microwave oven
and produces about 50 percent of world production in 2003. This case describes the
competitive and operational strategies, Galanz, used to achieve such rapid growth. The
company began with a clear competitive strategy based on cost leadership. They developed
and implemented a system of operations, to help to reduce costs through economies of
scale, the transmission capacity of the developed countries and make full use of available
capacities. The Several factors including high competition and market changes, restriction
of trading tariffs, institutional environmental changes as well as natural disaster influenced
the firm to shift its activity to electrical market.
There were also other factors that played a major role in making Liang shift to microwave
ovens production. First, although there were foreign competitors in the market, they do not
know much about the environmental changes in Chinese market. Second, microwave price
was high and unaffordable for the Chinese consumers. Third, rapid economic development
in China opened up potential growth opportunities in this segment. Forth, changes in
Chinese lifestyle and rising affordability. Fifth, ease of manufacturing microwave oven
that as it was invented in the 50s. When Liang Senior became major shareholder of
Galanz, he entered the microwave market successfully because he knew the Chinese
market better than the competitors, so he took the initiative and started producing Galanz