1.
Why is the Acer Aspire in such trouble just two
and a half years after its launch? What are the sources of the problems in the
U.S.? Worldwide?
Client Server
organization structure
Ø
RBU’s and SBU’s were decentralized with lack of trust,
understanding and coordination between them.
Ø
RBU’s lacked product expertise, resources and
worked independently without capitalizing the strengths of SBU’s leading to
component integration issues and diverse products.
Aspire’s Quality and
Customer Service:
Ø
Quality of the product did not live to the
marketing hype and positioning.
Ø
Revenue lost because of 3 years warranty and 15%
and more returns.
Ø
Faulty products [CD-Rom issue] lead to expensive
long customer service calls.
Inventory Issues:
Ø
Excess Inventory [faulty products with local
adaptation > 100 configurations].
Ø
No
Standard Acer parts added 10-15% to cost, excess tech support for unique parts.
Market Competition
Ø
Global Branding ads not effective because of
modified design and product positioning by individual RBU countries.
Ø
Lack of standardization and each RBU customized
according to their needs adding to redundant functionality and more costs.
Ø
Lost market share because of strong brand
competitors low price offering.
2. How
effective has management been in responding to these problems? What is your
evaluation of the changes they have made to the product, the marketing
strategy, the organizational structure and the management roles and
responsibilities?
Created Marketing
coordination for a Global Brand:
Ø
Culver took an informal role which shows lack of
global business management team with assigned responsibilities.
Ø
Aspire had a different look and feel from
country to country and each country positioned differently and used different
pricing strategy.
Did not share
insights and best practices across countries.
Ø
Hong Kong marketing program was a great success
by teaming with chase bank which could have been done in other Asia pacific
countries.
Diverse design and
marketing approaches
Ø
Customers were confused because they got stripped
down version of Aspire in the local market but not the globally advertised
product.
Ø
Inventory issues [unique components for local
market].
Ø
Lack of common brand planning process and
responsibility to create cross-country synergies.
Ø
Accounting:
No provision for future service costs, returns and inventory write-offs which
were charged against same period sales.
Client Server
Organization
Ø
Culver’s new marketing strategy with three new
segments helped in expansion and reengineering customer service [20 minute to 2
minute wait time].
Ø
Arthur Pai as Project coordinator between RBU’s
and SBU’s helped to resolve the tensions and enforced them to work together. Influenced
Frog design to make entirely of standard rather than custom parts.
3. In
1998, how should Stan Shih respond to broader issues raised by the Aspire
problems? Should be continue to support the goal of building Acer as a global
brand? What changes (if any) would you recommend he make in Acer's global
strategy, organizational structure and / or management philosophy to ensure
that it can continue to operate successfully worldwide? How should he implement
your recommendations?
Ø
Redefine
Client server concept: Stan must integrate RBU’s into SBU’s and move from a
decentralized to centralized system to become a global business unit.
o
This will also help RBU’s to leverage the
product expertise, build trust and capitalize the knowledge and additional
resources from SBU to better position Acer in the global market.
o
Eliminates the redundant stuff and helps Acer in
standardizing critical parts.
o
Reduce
the overhead caused by unique components and increased customer calls from
faulty products.
Ø
By doing this Acer can lead in its Global
operations, leverage them for OEM business and position them for a better
global brand.
Ø
Yes Stan should support global brand.
o
Branding should be created as a global function
centralized in Taiwan.
o
Stan should form a Global management team with global
brand managers from each country.
o
Stan should serve as Brand champion and each manager
should be assigned responsibility for their countries.
o
Strategic elements of the marketing mix such as
brand name and positioning should be standardized than execution –intensive
elements such as distribution, sales promotion and customer service.
Ø
Utilize computer sales forecast tools for better
inventory management; know where to invest and how to spend the marketing
funds.
Developed Country : Australia 
Emerging: India 
Enter
Do not
enter
