Table of Contents
Revenue Model, Culture and Business Goal
Keda Industrial Company Limited specializes in developing innovative, custom-made ceramics machinery and equipment, as well as other building materials machinery. It started as a small business in a market where the competition is predominantly consisted of European enterprises. According to Fung et al. (2017), the company offered high degree of autonomy and flexible business culture in order to achieve its “pursuit of perfection through endless innovation in the global market” (Fung et. al, 2017, p.2). Nowadays it can be seen that the company still follows its objectives and as per their website they are transformed into four core values, namely “innovation infinitely, create value for the customers, credibility, and quality first”.
Major Business Strategies
Main advantages of Keda are its drive to innovate and the ability to generate profits with low volumes. Prior to the implementation of ERP system Keda was producing six machine presses per month, and its total revenues are reported as $209 million as of 2009. This exemplifies the previously stated low volume production with high margins. Furthermore, the business also has invested $5.4 million into R&D center and opened a national enterprise post-doctoral workstation in 2003 where scholars can work on research project. These investments and initiatives support the values and business objective for constant innovation.
A business strategy presented in the case of Fung et al. (2017) is the computerization of Keda which has begun in 2000. This modernization process started without being clearly defined and guided. In the case, it is mentioned that projects were not solving company’s problems and the general feeling was that there was no strategic goal behind the IT projects (Fung et. al, 2017). The situation changed when in 2003 Dr. Fan Zhu was appointed as a head of the IT department. He froze all inefficient projects and in six months created a blueprint for the implementation of multiple solutions affecting all key business functions.
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IS Strategy
A variety of definitions for information systems (IS) strategy exists, however it can be viewed from an organizational point of view as investment, deployment, use, and management of information systems (Martinez-Simarro et al., 2015). The IS strategy focuses on implementation of new technology and systems to manage data and knowledge. As found in the paper of Martinez-Simarro et al. (2015) for innovative organization, IS strategy can bring profits and competitive advantages. The authors also distinguish two approaches to the strategy – innovative and concervative (following competition).
It seems that initially Keda approached its IS strategy conservatively as it started the computarization because other companies were doing it. Soon after Keda’s mangement realized this approach was not efficient for them and changed its direction. Keda’s new IS strategy had as obejctives to achieve process standardization, enhance management control and improve the accuracy, access and timeliness of information. As mentioned, the computarization plan of Keda included multiple soultions, but the priority was placed on the enterprise resource planning (ERP) system.
