Haier

Haier was founded in 1984. In the last 28 years, through its entrepreneurial and innovative spirit, Haier transformed itself from an insolvent collectively-owned factory on the brink of bankruptcy into the No. 1 global home appliance brand. In 2012, Haier’s global revenue and profit reached 25.8 billion USD and 1.42 billion USD respectively. Profit growth was 2.5 times revenue growth. Based on the statistics of Euromonitor International, a world leader in strategy research for consumer markets, Haier has been the No. 1 global home appliance brand four years in a row. On the 2012 “World’s 50 Most Innovative Companies” list released by the Boston Consulting Group, Haier is the only Chinese company in the top 10 and the No. 1 consumer product retailer.

Haier is known for disruptive innovation in its product solutions and management model. As an open platform company, Haier provides leading home appliance solutions to its users. Qingdao Haier (SH: 600690) uses disruptive innovation to create smart appliances for its users with the aim of becoming the leader and game changer in the home appliance industry. Haier’s five R&D centers around the world have forged strategic partnerships with first-class suppliers, research institutions, and prestigious universities to create an innovative ecosystem composed of over 1.2 million scientists and engineers connected by virtual and physical networks. By the end of 2012, Haier had filed 13,952 patent applications accumulatively and had been granted 8,987 patents. Haier Appliances (HKG: 1169) creates a commercial ecosystem based on an interactive platform and a delivery platform. By leveraging the synergy of marketing, virtual, logistics and service networks (“quadruple play model”), it can provide delivery and installation services to users within 24 hours and create the best user experience thanks to the connectivity between virtual and physical networks. The competitive advantages of the quadruple play model helped its distribution channel Gooday attract famous domestic and international brands. The open logistics platform for over-sized items can provide services to China’s top five e-commerce retailers and appliance and furniture manufacturers.

In terms of management, Haier uses its innovative win-win model that aligns employee goals with user needs to inject vitality and creativity into the organization, allowing employees to create value for users and themselves.  Haier has changed its organizational structure from a pyramid into an inverted pyramid and then flattened it even further to become a dynamic network-based organization composed of innovative ZZJYTs (self-management unit). Every node in this network is driven by users instead of leaders. Opening to external resources enables Haier to meet the changing needs of users.  As it is considered to be a potential solution to the management challenges in the Internet age, this innovative model has attracted the attention of world famous business schools and management gurus.  Haier’s win-win model that aligns employee goals with user needs has been included in the case collections of business schools for teaching and research purposes.

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