Gold peak electronics

Abstract

The report illustrates the case of Gold peak- a Hong Kong based company that initiated its business to offer low-tech products in the HongKong markets. The company eventually moved into China due to attractive market opportunity and the strategy to develop high tech technology in the market. The company later acquired two UK based organizations that offered it the resources to pursue its business strategy. However, such acquisition came with a cost of managing maintaining the cultural diversity, language barriers, internal resistance and organizational coherence with the end goal. Since the engineers in the UK facility are different from China, the issues of cultural management and job security arose.

In such a situation, Li has to develop such a strategy that could omit the cultural issues from the organization and develop a collaborated team structure to shake knowledge and expertise, making the organization successful and competitive in the market.

Keywords:  Competitive edge, Culture, Language

Gold peak electronics Harvard Case Solution & Analysis

Introduction

Gold Peak Electronics is a Hong Kong Based company, established in 1960’s.HongKong always hada comparativeedge of offering low-tech technology development to the market, which in later year sultimately became the reason for departure of GPE to other markets.

Initially, due to the dilution of the brand image and competitive edge of the company, GPE initiated its business in China, which has been an easy market in terms of language barriers and low entry barriers, along with the fact that both countries somehow shared same working patterns, low cultural distance and friendly governmental relationship that allowed GPE to penetrate effectively into the market.

Whileentering into the Chinese market, the companyinitiated to prude its own product and became the OEM, and in the later period, it turnedinto the ODM, originaldesignmanufacturers, using the knowledge derived from Research and development.

In the late 90’s, the company invested in the Research and Development to harness thepower of original offerings and developing a strongcomparative brandimage in the market.In doing so, it established an acquisition strategy with a UK based company to drive the expertiseand talent in developing innovative products in the market.Suchtransformed the brand image of the company into OBM-Original Brand Manufacturer.

Though the acquisition offered great value to the company, however,itcreated the issue in managing the organizational structureand culture coherently and uniformly in the GPE, due to thefact that, since UK and China has differentculture andvalues,moving and sustaining theemployees in these two location, and maintaining a team synergy is difficult, alongwiththe developmentof trust in terms of knowledge sharing. Suchcreated a gridlock For LI to pursue thisstrategyeffectively in the global market, making the process of globalization slow.

Analysis

What pros and cons company faced before and afteracquisition?

Since GPE pursued the globalizationstrategy and developed the alliance with two UK basedcompanies,apartfromChinese and Hong Kongfacilities, it offered the company thefollowing benefits accompanied with certain costs.

Pros and Cons beforeAcquisition

GPE initiallyoperated through the Chinese market shifting its researchfacilities and manufacturing in the particular regions.Such offered the company:

• The ability to produce and manufacturethe electronicproducts at low cost.It is due to the fact that, sinceChinese laborischeapandHaskell sets usually high-tech production, it offered greatvalue and supportto GPE functions in Chinese market................

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