1.HTC’s strategic issues evaluation3
2.Models and frameworks6
3.Conclusion and recommendations12
APPENDIX A: HTC Financial statement16
APPENDIX B: Production And Sales for The Most Recent Two-Year Period17 APPENDIX C: SWOT analysis18
APPENDIX D: Porter’s five forces analysis19
APPENDIX E: VRIO analysis for HTC21
Since the end of XX century a lot of IT manufacturing companies appeared in the Global market, but not all of them managed to find and even less of them to sustain its competitive advantages. HTC Corp. is one of the companies of that period who successfully transformed its business from Original Design Manufacturer (ODM) producing complete products to famous brand-name companies into Original Brand Manufacturer (OBM) making its own product under its own brand. On its way into successful OBM transformation the company faced a lot of obstacles concerning its Boards of directors’ strategy and vision of company’s future. However, despite the fact that company has become famous recognizable brand, it has been facing a lot of issues concerning stiff competition, supply chain management, product line, finance and strategic partnership. The paper aims to define and justify strategic issues HTC Corp. encountered applying relevant theories and techniques from Strategic management and to recommend solutions for those issues.
1.HTC’s strategic issues evaluation
HTC Corp. was founded in 1997 by Cher Wang and HT Cho as an Original design manufacturer company. Being excellent in design and engineering under HT Cho management it was very successful in ODM market producing laptops for HP, pocket PCs for Compaq and Palm and smartphones for branded handset companies and service providers T-Mobile, British Telecom, Orange and Vodafone (Yoffie & Kim, 2009). Having already earned reputation as a reliable manufacturer, in 2006 HTC made decision to promote its own brand. At that moment most people in the board were ambiguous about this decision (Yoffie & Kim, 2009). However, by the end of 2009 the company eventually quitted the traditional ODM business. New OBM business required from company management extremely important decisions concerning its old ODM business partners (Yoffie & Kim, 2009). Changing direction from ODM business to own brand development involved rethinking its organizational structure, financial costs and marketing strategy in order to enter the global market (Tushman & Herman, 2012). This implies the following strategic issues: organizational structure, financial, marketing and globalization issues. At the moment when the company made decision to enter smartphone market, the most companies had been at a growth stage of its lifecycle. Big manufacturers as Nokia, RIM, Samsung, LG, Sony-Ericsson and Motorola had already been fighting for the market share. Furthermore, each of them had competitive advantages over HTC in terms of cost advantage due to economies of scale (Samsung) and patents (Nokia). As a result, HTC had the following strategic issues: Competition, Partnership, Globalization, Marketing strategy, Operations. Although the mobile phone market was highly competitive, emergence of smartphone devices brought the biggest changes in the competitive environment on a global scale (Euromonitor International, 2011). It gave chance to HTC to gain advantage over incumbent market leaders Motorola, Nokia and RIM. However, along with HTC other players entered the market. In 2007 Apple introduced its powerful and innovative smartphone, LG and Samsung were quick enough to innovate as well not to lose its share of the market. Each of these manufacturers has its competitive advantage. Which are: -economies of scale for Samsung
-hardware and software design for Apple
-business customer orientation for RIM
Looking at the financial statements of the previous...