EXECUTIVE SUMMARY
ACER CASE STUDY
MGNT389 (Tutorial 12:30)
Chen Chen
Hai Nhi Tan
Sam Sporbert
Christopher Connors
Yuan Cao
This study source was downloaded by 100000760886123 from CourseHero.com on 12-16-2023 13:52:46 GMT -06:00
https://www.coursehero.com/file/32353827/Acer-executive-summarydocx/
1. What is Acer's international business strategy?
To identify Acer’s international business strategy, integration-responsive (framework is
applied to explain key driving factors for global integration and local responsiveness. In
considering organisational structures and strategic capabilities, we focus on external
pressures that influence the degree to which the organisation centralizes and coordinates
activities and/or adapts to its local market (Silver 2015, p. 4). Four types of strategies are
developed based on two conflicting dimensions of the framework: home replication,
multidomestic, global and transnational strategy (Cavusgil et al. 2017, p. 328). Acer adopts
transnational strategy as the firm strives to be responsive to local needs while retaining
sufficient central control of operations to achieve efficiency and knowledge leverage
(Dorrenbacher & Geppert 2016, p. 5). In the notion of global integration Acer seeks cost
reduction by developing ‘fast food’ style logistics, downsizing and diluting shareholdings,
conducts global sourcing through suppliers’ inventory cut-off, and takes advantage of global
media by addressing its image problem and investing progressively to build its brand (Clyde
2003, p. 219). On the contrary, the need to optimize local responsiveness and flexibility
results from the needs to leverage natural endowments, which Acer uses ‘fresh ingredients’
and local suppliers; the pressures to respond to local customer needs and local competition,
because the firm’s managers are lack of international experience and knowledge about
foreign markets; and the need to segment by country (Clyde 2003, p. 221).
2. What type of structure and control systems would best suit Acer to support its plans?
A decentralised control system would be good for Acer as it involves the subsidiaries around
the world having substantial authority. This decentralised approach to management allowed
for faster decision making based in each region. This combined with the independent
ownership generated more motivation and incentive for the international subsidiaries to work
hard. This approach is beneficial for Stan Shih’s plans for a ‘local touch, global brand’,
This study source was downloaded by 100000760886123 from CourseHero.com on 12-16-2023 13:52:46 GMT -06:00
https://www.coursehero.com/file/32353827/Acer-executive-summarydocx/
through allowing subsidiaries in different countries to have responsibility and be influenced
by their local territory.
The use of a decentralised management model is supported through Acer’s disintegration
model. This model entailed each standard component of Acer to be represented as an industry
segment, beyond their SBUs and RBUs. Benefits of this include better performance-to-cost
ratio for the customers, as well as greater competition. To complement the decentralised
management approach, the global matrix structure is recommended. The global matrix
structure combines the advantages of the geographic area, product, and functional structures,
while minimising their disadvantages. A main reason for the global matrix structure to be
employed by Acer is Shih’s ‘local touch, global brand’ philosophy that has been achieved,
through the disintegration model.
3. Critically evaluate Acer's Client Server Organisation model
Acer re-engineered their business through the Client Server Model to become a top company
in the electronics industry. The model can be evaluated through three main points. First, a
comparison of the new Client Server model against the more traditional financial model of
control. Second, the benefits and constraints of the model itself and third, whether the model
was successful in implementation based on financial results and business growth. In summary,
Acer’s Client Server model aimed to respond to threats in market position and regional area
growth, by increasing local responsiveness through an integrated network of strategic and
regional business units and activities. It allowed for global integration through a transnational
strategy and supporting technological capabilities while emphasizing information exchange.
The model had a direct correlation between long-term financial gain and operating
performance. Therefore, the model can be considered successful based on financial
This study source was downloaded by 100000760886123 from CourseHero.com on 12-16-2023 13:52:46 GMT -06:00
https://www.coursehero.com/file/32353827/Acer-executive-summarydocx/
performance, however, it is important to note that there may have been other factors, working
in conjunction with the model that allowed for Acer’s success.
4. How would you build and extend the culture of an Asian multinational such as Acer?
Acer currently has an approach that steers away from traditional Asian culture (Clyde-Smith,
D 2003). The Multinational Corporation – lead by Shih, adopted what would typically be
classified as a western culture approach. This has been evidenced in their Dragon Dream
approach, “Go” or Wei Chi approach or their flat hierarchy approach (Clyde-Smith, D 2003).
These cultural approaches do in fact work to a degree. However, to extend the culture of an
Asian Multinational such as Acer, it is critical to keep in line with current and traditional
cultural practices. This can be achieved through the correct application and understanding of
Hofstede’s model. In summary, Multinational corporations have a good cross-cultural
management strategy that is the foundation for building and expanding corporate culture.
Cross-culture management of enterprises is using cross-culture advantage to eliminate the
culture conflict and lead to the successful operation of multinational corporations (Adler,
Ghadar ， 1990).For instance, cross-cultural training is seen as the principal method of
eliminating cultural conflicts and realizing effective cross-cultural management.Strong
culture in an Asian multinational company, such as Acer is considerably in need of executive
managers’ roles.The role of this manager will help multinational corporations to better build
their culture （Ahlstrom, Bruton, 2010）.The multinational corporations in Asia that adopt
cultural innovation strategies and geocentric management models will be able to expand the
corporation culture to an extent.
References:
This study source was downloaded by 100000760886123 from CourseHero.com on 12-16-2023 13:52:46 GMT -06:00
https://www.coursehero.com/file/32353827/Acer-executive-summarydocx/
Acer-group.com. (2018). Annual Reports. [online] Available at: https://www.acer-
group.com/ag/en/TW/content/annual-reports [Accessed 18 Apr. 2018].
Adler, N, J. and Ghadar, F. 1990. Strategic human resource management: a global perspective,
p.235-260
Ahlstrom, D., Bruton, G.D. (2010). International Management: Strategy and Culture in Emerging
World. Mason OH: Cengage Learning.
Cavusgil, ST, Knight, G & Reisenberger, JR 2017, ‘Strategy and Organisation in the
international firm’, International business: the new realities, p. 316-343
Clyde-Smith, D., (2003), “Case 21: the Acer Group: building an Asian multinational”, in
Mintzberg, H. (2003), Strategy Process: Concepts, Contexts, Cases, 4th ed, Prentice Hall, Upper
Saddle River, NJ, pp. 217-228.
Dorrenbacher, C & Geppert, M 2016, ‘The Integration-Responsiveness Framework: A Review
and Application of the Concept’, Berlin Institute for International Business Studies, no. 1, p. 1-
30
Silver, TJ 2015, ‘The Role of the Integration-Responsiveness Framework in an International
Branch Campus: A Case Study’, p. 1-157.
Horowitz, D 2016, 'Geert Hofstede', Salem Press Biographical Encyclopedia.
Nakata, C 2009, Beyond Hofstede: culture frameworks for global marketing and management /
edited by Cheryl Nakata, Basingstoke [England] ; New York : Palgrave Macmillan, 2009.
This study source was downloaded by 100000760886123 from CourseHero.com on 12-16-2023 13:52:46 GMT -06:00
https://www.coursehero.com/file/32353827/Acer-executive-summarydocx/
Noerreklit, H, Schoenfeld, H-M, 2000, ‘Controlling Multinational Companies: An Attempt to
Analyse Some Unresolved Issues’, International Journal of Accounting, Vol. 35, No. 3, pp. 415 -
430.
Porter, ME, 1979, ‘How Competitive Forces Shape Strategy’, Harvard Business Review, March-
April, pp. 137 - 145.
This study source was downloaded by 100000760886123 from CourseHero.com on 12-16-2023 13:52:46 GMT -06:00
https://www.coursehero.com/file/32353827/Acer-executive-summarydocx/
Powered by TCPDF (www.tcpdf.org)
