When Chris Chen founded VanceInfo Technologies in Beijing in 1995, the company had 25 employees and one low-end IT services outsourcing job for an U.S. multinational. By August 2008, through a mix of acquisitions and organic growth, VanceInfo employed more than 4,800 individuals, had numerous Fortune 100 customers, and enjoyed revenues exceeding $80 million over the preceding 12 months. Although modest compared to more complex Indian rivals, VanceInfo was nicely placed to seize an anticipated explosion in demand for China-based international IT services. At exactly the same time, rapid growth was stressing resources, systems, and the business's management personnel. Headcount was scheduled to quintuple to 20,000 in four to five years' time to keep pace with competitive earnings targets. Old ad-hoc manners no longer could suit present or future needs.
To succeed, direction had to execute internal management systems, and new financial, operational, particularly in the crucial area of human resources where VanceInfo faced some of its biggest challenges. These included introducing effective procedures for training, rapidly enlarging, managing, and retaining its work force. Additionally, in its quest to grow its work force to 20,000 within five years, go into higher-margin business lines needing new expertise, and beat out domestic and international competitors, management had to strike a balance between quick increases via acquisitions and possibly slower increase through organic expansion. The case helps students think through the complexities involved in managing a fast growing business. Especially, it asks students to analyze whether the current strategy of growing organically and through selective strategic acquisitions of VanceInfo will permit it to reach its targets. In addition, it asks them to analyze the company's human resource challenges and its attempts to meet them.
Scaling How China-Based VanceInfo Grows Big Fast case study solution
PUBLICATION DATE: January 23, 2009 PRODUCT #: HR34-HCB-ENG
This is just an excerpt. This case is about LEADERSHIP & MANAGING PEOPLE
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