Galanz Case Study Analysis: Competitive and Operations Strategies

This case study analyzes Galanz's journey from a microwave manufacturer to a global leader, focusing on its competitive and operations strategies. The analysis begins with the identification of order qualifiers and order winners in Galanz's early stages, highlighting the importance of high-quality products and large-scale production. The study then examines Galanz's distinctive competence, which was its high manufacturing efficiency, and how it aligned with its order winners. The case delves into the critical success factors, such as growing demand and cheap labor, and the operational objectives prioritized during the OEM, ODM, and OBM phases. The challenges faced by Galanz while balancing OEM/ODM and OBM businesses are explored, particularly in managing product varieties, R&D, and after-sales services. Finally, the analysis considers whether Galanz fits the disruptive innovation theory, emphasizing its market entry strategy and progression as a company, highlighting the company's innovation to secure market share.

Running head: PROCESS MANAGEMENT 1
Process Management
Name
Institution

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1. In its early stages (1992-1999) as a microwave manufacturer
a. What would you consider the order qualifiers for Galanz? (1 point)
In the founding stages of Galanz, the company was faced with the challenge of winning
over demand. The company had to focus on imparting order qualifying attributes on its products.
Order qualifiers are those qualities of a product that attract a potential customer to consider
buying the product. In the case of Galanz, the order qualifiers were high quality products and the
potential to produce in large scales (Shao, Li, & Yin, 2013). The company, even in its initial
stages, produced top-quality products according to the standards of the time, and the company
was also able to provide a significant number of products when called upon by the market.
b. What would you consider to be the order winners? (1 point)
Order winners are the attributes that make a customer willing to part with money for the
product. Galanz offered their products at very low prices. The low costs combined wit superior
quality was the order main order winners for the company. The company offered leading costs
and recognized the need for affordability in the Chinese market. This won it, customers.
c. Identify the distinctive competence of Galanz and if it aligns with its order
winners? Identify two Critical Success Factors (CSF) for Galanz in this early
stage. (1 point)
The main distinctive competence at Galanz was the high manufacturing efficiency. The
company had an optimized production plan that was very efficient (Zeschky, Widenmayer, &
Gassmann, 2011). Through this method, the company was able to manufacture with very low
production costs, and consequently, it could offer more friendly prices to customers; therefore,
the friendly production costs and pricing strategy were well-aligned to order winners.
Some of the main critical success factors for Galanz were;
- The country’s growing demand for affordable consumer products.
- The availability of cheap labor and land.
2. Cost, quality, flexibility, delivery, product variety, and after-sales service are the
objectives of the usual operation for most companies? For each of the following
phases, identify which objectives were prioritized by Galanz. Explain your answer.
a. OEM phase (1 point)

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Quality, cost, delivery- in its OEM phase, Galanz understood the need to create a
reputable brand name. the company aimed to create top quality products and to do so at low costs
(Zhang & Zhang, 2015). The company purposed to proper management of production costs to
keep then at a minimum value. The ultimate goal at this point was to make the product have
quality as superior as possible at a cost as low as possible. The company recognized the need to
deliver customer orders/demands and, therefore, also prioritized product delivery. These
objectives were strategically [poised to penetrate the market and to a large client basis.
b. ODM phase (1 point)
In the ODM phase, the company focused on product variety and innovation in addition to
cost and quality. The company had previously achieved low-cost quality production and realized
the need to present the customers with a wide range of products. The company focused on the
application of innovative technology to produce a wide range of products while maintaining its
leading position in terms of quality and cost.
c. OBM phase (1 point)
In the OBM phase, the company had developed a significant influence on the market and
needed to improve service delivery to customers. The company, therefore, prioritized aftersales
services, product varieties, and flexibility. The company had developed a clientele, and this
clientele presented varying needs and preferences in terms of precut configurations. The
company had to give them a variety to choose from, and it had to be flexible in conforming to
market trends. To further establish its brand, identify the company focused on providing after-
sales services to customers.
3. What are the operations challenges faced by Galanz as it seeks to balance its OBM
business with its OEM/ODM business? (2 points)
At one point in its growth cycle, Galanz was running services for both OEM and ODM
customers. Specifically, when the company was transiting into the OBM phase, the service
offered to both OEM and ODM customers created massive operational challenges. The company
was faced with the need to managed product varieties. Product varieties complicate planning,
sourcing, and inventory management ad also production line changeovers (Jones, 2017). The
company was faced with the challenging task of managing smaller production volumes for each
product. the company also had to develop and manage a research and development department.

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The department would call for prototype manufacturing and testing, and this called for extensive
planning with a complex resource allocation strategy. Providing after-sales services to customers
was also challenging, given the stretched resources the company was operating within the
transition period. These also called for logistics management of which the company hadn’t
practiced before. The company had to manufacture a specifically planned volume of OBM
products; this meant that the company had to conduct demand forecasting to determine the
product volumes. It was very challenging for the company to forecast demand for products that it
was introducing in the market, considering that it had no data to relate with. The company also
had to do extensive and widespread marketing for its OBM products; this meant that the
company had to put in extra planning for the marketing department.
4. According to the disruptive innovation theory of Bower and Christensen, would
Galanz be considered a disruptor? If yes, what is disruptive innovation? In your
discussion, consider Galanz’s market entry strategy and its progression as a
company. (2 points)
Bower and Christensen's disruptive innovation theory argues that disruptors penetrate the
market by entering through sections that are underserved by existing companies (Li, Porter, &
Suominen, 2018). The disruptor uses these sectors to gain a foothold in the market, after which
they move upwards to more profitable segments. Eventually, they compete with the established
companies, and at times, they end up displacing them.
Galanz started by the identification and ventured into an underserved sector in the
Chinese market. The company entered the market by offering a low-cost product to the market.
When component suppliers realized that Galanz would eventually overtake them, they restricted
supplies and forced Galanz to innovate massively (Li Y. W.). Through innovation, the company
was able to offer more diverse products and acquire larger market share both locally and
internationally. The company was able to slowly by slowly drive out many established
companies from the market and established itself as an OEM/ODM supplier (Sodhi & Tang,
2013). Galanz didn't start as an innovator, but with the competition restricting supplies, the
company was forced to innovate. The company, therefore, became an innovative disruptor.
Galanz was, therefore, a disruptor (Nagy, Schuessler, & Dubinsky, 2016).

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