Acer Case

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Discussion Question
1. How does the “global market/local market” paradox figure into Stan Shih's strategy for China? Answer:Acer have a good chance to make China as their home market so Acer can capture critical economies of scale that will allow Acer to develop innovative new product for global market. And the other hand, Acer can use their image as global brand to building strong home market. 2. Acer is now the world’s second-largest PC Company, behind Hewlett-Packard. How can it sustain its growth? Answer: Acer Inc., the world’s second-largest computer vendor, needs reengineering and repositioning because its previous winning formula is not effective any more, its founder Stan Shih said Tuesday. Shih, who no longer manages the Taiwan-based multinational computer group but still controls a huge stake in the company, made the suggestion on the sidelines of a cultural seminar. His advice came after Acer unexpectedly lowered its PC sales estimate for the first quarter of this year last Friday and gave a conservative forecast for its Q2 business prospects. Shih acknowledged that smartphones and tablets have had a significant impact on the personal computer industry. He expressed the view that Apple’s products, such as iPhone and iPad, have brought new visions and new concepts to the technology industry. Because of changing business environment, Acer underwent a major re-engineering almost once every 10 years. In 1992, Acer reshaped its increasingly bloated organization under a lean and mean strategy. Now the company is at a crossroad again. Shih said Acer has only lowered its business forecast and has not incurred any losses. “But its misforecast indicates that the PC market is undergoing substantial changes, ” Shih said. “The unexpected slow sales in Q1 should serve as a wake-up call. It’s time for Acer to undergo its third wave of re-engineering and re-positioning.” Noting that Apple not only sells products but also sell services and that HP has...
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