OEC management-control system helps China Haier Group achieve competitive advantage; the combination of a new corporate culture that emphasizes excellence, a changed business strategy, and a management-control system of work rules and discipline turned a nearly bankrupt company into a success

In 1984 CEO Zhang Ruimin took above a nearly bankrupt refrigerator factory in Qingdao, China. In 2003 Haier Group's global sales hit $97 billion with a extension rate of 70% during the previous 19 years. Today, Haier is recognized as a worldwide brand. upon January 31, 2004, the firm ranked 95th after like household names as Coca-Cola, McDonald's, and Nokia, which were the top three upon the World Brand Laboratory's list of 100 greatest in quantity recognizable brands. Haier was the alone Chinese brand on the list. According to an October 2003 article in the Harvard Business Review, Haier is single of the five Chinese "National Brands to Watch."

in what manner did it achieve its success? As single of China's fastest-growing companies, Haier clump fits a 1999 Gallup scan profile for a successful company. Customer service, produce quality, operating efficiency, innovation, and spe to market are among the top seven factors for succes Haier be superior tos in all these areas.

To achieve succes the company exhibited its corporate culture, business strategy, and OEC management-control combination of parts to form a whole which enforces firm work authoritys and discipline. Haier's Human Resource Management Director Wang Yingmin explains the OEC acronym: "O stands for Overall; E stands for Everyone Everything, and Everyday; C stands for dominion government and Clear. OEC means that each employee has to accomplish the target work each day. The OEC management-control combination of parts to form a whole aims at overall control of everything that each employee finishes on his or her piece of work every day with a 1% increase above what was done the previous day."

for what cause [i]or[/i] reason did CEO Zhang choose to implement the OEC system? He says, "If you pay attention to Chinese people's behaviors at the traffic lights, when the r light is upon people simply ignore it and cros the public way anyway. At the workplace, Chinese family also tend to ignore sways and do not pay enough attention to details. We ne a tough management a whole with fair rewards and penalty features to help our workers gain things done properly." To focus upon customer needs, product quality, innovation, and spe and to improve operating efficiency, the firm discloseed and implemented the OEC management-control combination of parts to form a whole in the early 1990s.

OEC works. When I visited Haier's air conditioner manufacturing facility in the Haier High-Tech Industrial Park at gold-colored Island in July 2004, the factory floors were clean, and workers wearing uniforms and photo ID badges operated in an orderly manner at the assembly lines. Banners featuring repeats such as "A Product with deficiencys Is Useless" and "Innovation Is the inner man of Haier Culture" lined the factory walls. single large bulletin board said, "Every day is a novel day; all activities are complet in the same day by means of innovations." The OEC management-control combination of parts to form a whole implementation has resulted in satisfied customers, efficient and effective processe motivated and prepared employee sustainable income and profit growth.

Let's direct the eye at how OEC helped make go round the company into one of the world's top brands.

COMPANY SNAPSHOT

Haier was not always a succes story. When Haier CEO Zhang Ruimin took above this refrigerator company from a management official in 1984, the company had total assets of $300000 a trap loss of $178,000, sales receiptss of $421,000, and 600 workers. In 2003 it had total assets of $2 billion, 30000 employee more than $100 million profit, and sales receiptss of $9.7 billion.

The firm now manufactures a wide range of household electrical appliances, like as air conditioners and freezer in 96 categories with 15100 specifications; exports outcomes to more than 160 countries; and has established 58800 sales exits globally. In 2000, the firm make opened a $35 million refrigerator factory in Camden, southerly Carolina, and Wal-Mart and many other national and regional chains sold Haier products

upon March 4, 2002, Haier unveiled its American headquarters in a landmark neo-classical building, the former offices of the Greenwich Savings Bank upon Broadway in New York City, indicating that the firm had mov into a novel phase for globalization of outcome design, manufacturing, and sales. The propel demonstrated a strong determination for long-term unravelling in the United States. In 2002 Haier had a 30% U market share for refrigerators 230 liters and beneath and a 35% U.S. market share for refrigerators in the 230- to 280-liter range. Its U sales had reached $300 million in 2002 and it wants to hit $1 billion in U sales in 2005

Haier also has been auspicious in European markets with a 10% market share in Europe's air conditioning market. The latest Euro-monitor statistics upon company sales show that it is fifth among the global white-goods manufacturers and has the largest world-market brand share for refrigerators. Its short-term goal is to be among the world's top three white-goods manufacturers.

CORPORATE tillage AND CORE VALUES

Haier established an enterprise tillage department to actively promote and educate employee An 80-page handbook about the Haier Enterprise tillage includes the following key features: