Zongshen Industrial Group Case Study by Pico

An analysis of the Zongshen Industrial Group's strategy to diversify their business by developing e-bikes as a new business unit.
# 145770 | 2,199 words | 14 sources | APA | 2010 | BD

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The paper is a synopsis of the Zongshen Industrial Group. It discusses how the company began operations as a small assembler of motorcycle engines and, over 18 years of operation, evolved into one of the top global manufacturers of motorcycles and small gasoline engines. The paper also explains how the company's decision to diversify and to add an additional business unit, e-bikes, to their existing business unit, gasoline, changed the course of the company's development. The paper summarizes that, because e-bikes became the direction of the future, the management began spending more in order to develop capabilities in this strategic business unit. Because the organizational structure was resistant to this change, and the long-term objective of Zongshen Industrial Group would be to develop a market leadership position in the e-bikes business unit, reaching this objective would require new and different skills.

From the Paper:

"As a privately owned motorcycle manufacturer, Zongshen Industrial Group developed its business units based upon three areas: differentiation, supply chain management and product upgrades. Initially Zongshen had two subsidiaries: engine manufacturing and whole motorcycle assembly. At the time Zongshen did not have its own brand. In 2000, the management started to think about forming a group structure. This is the structure under which the company operates today. In order to address resistance to change, the company had implemented the strategy of differentiation. As a result there were traditional products and there were innovative products developed under the 'Cyclone' project. Diversifying to the e-bike market was the result of the 'Cyclone' project. The manufacturing of electric bikes was conducted by the unit of Zongshen PEM. It had been formed through the acquisition of PEM Technologies. Given the high rate of growth in both gasoline and electric bikes, the product structure of Zongshen Industrial Group was maintained accordingly."

Sample of Sources Used:

  • Aaker, David A. (2006). Strategic Market Management. McGraw Hill/Irwin.
  • Baldwin, Esther, and Martin Curley. (2007). Managing IT Innovation for Business Value: Practical Strategies for IT and Business Managers. Intel Press.
  • Brigham, Eugene F., and Michael C. Ehrhardt. (2007). Financial Management: Theory & Practice. South western college pub.
  • Dess, Gregory G., et al. (2007). Strategic Management: Creating Competitive Advantage. McGraw Hill/Irwin.
  • Evans, James R. (2007). Total Quality: Management, Organization, Strategy. McGraw Hill/Irwin.

Cite this Case Study:

APA Format

Zongshen Industrial Group (2010, November 28) Retrieved May 28, 2023, from https://www.academon.com/case-study/zongshen-industrial-group-145770/

MLA Format

"Zongshen Industrial Group" 28 November 2010. Web. 28 May. 2023. <https://www.academon.com/case-study/zongshen-industrial-group-145770/>