CASE ANALYSIS

SANDIP KUMAR I EPGP-13C- 095

1
 Contents

1. Define Problem
2. Organisation Structure/ Power Structure / Character Involved
3. Who is responsible to handle the problem?
4. How is problem handled at present?
5. Proposed Solutions
6. Expected Outcome

CASE ANALYSIS SANDIP KUMAR I EPGP-13C-095

2
 The problem in Galanz
• Limited focus on R&D technology and product development
• Over-dependence on price-cutting strategy. Galanz tried to establish a monopoly in the
market and pushing the competitor out of the market by destroying their confidence
• Higher demand of product but have the capacity of ~66% of magnetron production
• Low brand awareness in overseas markets.
• Anti Monopoly lawsuits.
• Prioritization of the business models. Conflicts of interest of OBM and OEM businesses
• Centralized decision-making body and centralized organization structure
• Capacity challenges for magnetron production.
• Inefficient production planning.
• Limited focus on market research and forecasting of demand. Escalated the production
capacity with the belief that higher production will encourage and put pressure on the sales
team to achieve higher sales
• Centralized organization structure where information and communication flow was slow
• Conflicts between R&D Department and Production department

CASE ANALYSIS SANDIP KUMAR I EPGP-13C-095

3
 Organization structure
• Galanz was highly centralized organization, wherein decision making was vested with the top
tier of the management.
• It had 3 tier of personnel senior directors , general manager and operation staffs
• Liang Zhaoxian, the vice-chairman and chief executive officer (CEO) and Liang Qingde were
currently responsible for handling of problem and decision making

CASE ANALYSIS SANDIP KUMAR I EPGP-13C-095

4
 How is problem handled at present?
Issues Current Practice
Limited Focus on R&D Follow the trend in the market instead of bringing innovation on their own
Training of employee Instead of hiring skilled laborers, dependent on the training of operator by taking entire production
line of rent from a company like Fillony which gave them access to technology also
Tackling competition Instead of innovating products, they focussed on taking advantage of cheap land and labor in China
and focus on price-cutting strategy. They focused on establishing a monopoly and pushing the
competitor out of the market
Issue of magnetron Galanz had the capacity of fulfilling 66% of its demand through in-house productions. The
remaining requirement was fulfilled through Toshiba, Panasonic, LG & Daewoo. However, each of
these brands refuses to fulfill the commitment due to the competition they were facing from
Galanz.
Low brand awareness in Strategic partnerships with multinational companies such as K- Mart, and Wal-Mart
overseas markets
Production planning Instead of demand forecasting and market research, they had this belief that Inventory motivates
salespeople to work harder and make more sales. Galanz dint had to bother about forecasting for
their OEM business, but OBM was mismanaged
Organization structure & Centrally organized and currently decision making vests with the top management only
Decision making

CASE ANALYSIS SANDIP KUMAR I EPGP-13C-095

5
 Proposed Solutions & Expected Outcome
Problem
Limited Capacity of
magnetron productions
Retrenchment by suppliers
Handling of customer
complaints
Difficult in handling
cultural differences in the
overseas market
CASE ANALYSIS
Solution
• Increase the in house production
• outsource the production of
magnetron
• Transfer from OEM to ODM
• The company had to invest in
enhancing customer service
capabilities
• Should adopt a global marketing
strategy
• Joint Venture with Other brands
Expected Outcome
Galanz doesn’t have to depend upon
Toshiba, Panasonic or LG for the
magnetron. So they can take on their
competitor heads on in the OBM market
The success of the company also depends
upon after-sales support. The consumer
interacting will ensure that a customer
gets as much use and value as possible
out of their purchase. This may entail
training on existing features or education
about new uses or capabilities.
They don’t have to depend on Kmart or
Walmart for sales in overseas markets.
They can sell using their own brand
name. With the quality, variety, and
price couple with the consumer
research, they can disrupt the overseas
market also, the way they have captured
the Chinese market
SANDIP KUMAR I EPGP-13C-095
6
 Proposed Solutions & Expected Outcome
Problem Solution
Limited focus on R&D, • Increase the budget. Most of the
Market Research & competitors are spending 6 % of
Forecasting the revenue on R&D.
• Galanz need to increase its spend
from 3% to 6% at least
• Start focussing on consumer needs,
changing tastes, income, and
preferences as per the regions.
• Forecast the future demand in
different categories of products
Centralized Organization • Organizational structure needs to
change. There should be a hierarchy
in the organization. Decision-
making should not be restricted to
the only top tier of management.
• Each department should be given
the power to make decisions for
their department
CASE ANALYSIS
Expected Outcome
• Instead of following the trends,
they can do innovations
themselves.
• It will also help in inventory
management and produce the
varieties as per the demand
• Decision making will be faster
• Communication will flow in an
efficient manner
• When people are given the
responsibility of making the
decision, this will give a sense of
ownership and likely to bring more
efficiency to the team
SANDIP KUMAR I EPGP-13C-095
7
 Proposed Solutions & Expected Outcome
Problem Solution
Optimum Balance between • Galanz should develop its OBM
OEM, ODM & OBM business in the international market.
• Galanz should continue its OEM/ODM
businesses
• These businesses help Galanz to get
economies of scope.
Price Cutting Strategy and • Instead of focusing on just price-
creating Monopoly cutting, Galanz should rather focus on
the consumer, product quality.
Monopoly, price-cutting was just
pushing out the competitor, but it was
not increasing their profit margins
CASE ANALYSIS
Expected Outcome
• Brand Recognition in the international
market. It will help Galanz to get world
recognized brand image.
• By capturing low hanging fruits in OEM
and ODM, the company can harvest
on the economy of scales and the
profit
• These businesses did not require
Galanz to invest in brand building.
Thus high profit and Galanz can price
Microwave oven at the lower side.
• The company will not have to have to
face anti-monopoly suits by any
government.
• Health competition will also ensure
regular improvement in product
quality
• By not focusing on price-cutting
strategy and improving product
quality, profit is likely to increase
SANDIP KUMAR I EPGP-13C-095
8