An Asian Multinational

Introduction
Acer’s beginnings

 Company created in 1976 as Multitech International

 Renamed in 1981
 Capital stock: 25, 000 USD
 Workforce: 11 employees
 Activity: IT products distributor
Introduction
Acer: 30 years later...!

 3 more brands belong to Acer Group : Gateway

(2007), E-machines (2007) & Packard Bell (2008)
 EMEA Leader in Notebook Sector
 Rank 2 (Globally) : for total PC’s & Notebooks
 Capital stock: 805 million USD
 Revenue : $17.9 bn
 Workforce: 7000
Introduction
Introduction
 Global PC Market Share by Units, Percent. 2006-2010.

Rank 2006  2007  2008  2009  2009Q4

1 Dell 15.9 HP 18.2 HP 18.4 HP 19.3 HP 19.8

2 HP 15.9 Dell 14.3 Dell 14.3 Acer 13.0 Acer 13.5
Leno
3 7.0 Acer 8.9 Acer 11.1 Dell 12.2 Dell 11.5
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Leno Leno Leno Leno

4 Acer 5.8 7.4 7.2 8.1 8.7
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Toshi Toshi Toshi Toshi Toshi

5 3.8 4.0 4.5 5.1 5.3
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Other
51.6 47.1 44.5 42.3 41.1
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Roadmap
1983: Acer begins manufacturing PC clones.
1988: Acer Incorporated goes public.
1991: Acer posts its first loss.
1994: Acer Computer International (Asia-Pacific
distributor) completes its initial public offering (IPO).
1995: Acer is top selling PC brand in Mexico, Bolivia,
Chile, Panama, Uruguay, Thailand, Philippines, and
Taiwan.
1996: Acer expands into consumer electronics.
1998: Company reorganizes into five units.
2000: Acer restructures, breaking off several
operating units; contract manufacturing spins off to
become Wistron Corporation.
2003: Acer becomes the world's fifth largest PC
maker.
2005: Stan Shih retires; J.T. Wang is named CEO
and Gianfranco Lanci becomes president
2007: Purchase of Gateway & Packard-Bell brand
 Going International
Local touch, global brand
Positionning/Product Strategy:

 Acer has long positionned it-self as a follower (first assembling for OEM)

 High quality but affordable products (innovative but seldom pioneer)

 Progressive product diversification: focusing on value-added segments

 Building a global brand

 Going International
Local touch, global brand
Production Strategy: Decentralisation

 Centralized R&D and (large scale) manufacturing of value-adding

components in low cost countries (economies of scale, low cost structure)

 Decentralised assembling process, together with local marketing and

distribution operations (low inventory cost, „just-in-time“)

 Local politic of joint ventures and partnerships (good knowledge of local

markets)
 Going International
Local touch, global brand
Management/Ownership strategy:

 Decentralized and highly independant management (flexibility to demand)

 Locally highered operationnal and managerial workforce (local expertise)

 Participation of local shareholders: „21 in 21“

 The client-server organisation

Organisation Structure
Price war and costs efficiency
Economies of scale from the competitors
Attruition war with prices – not just at lower end portable
computers market, but for higher end products too.

SOLUTION:
Fast Food Business Model
Joint ventures to compete more efficiently with costs
savings on components and distribution network.
Decentralize everything, give autonomy to the RBUs and
SBUs
Innovation in Competition
The Design, Manufacturing and Service Division (DSM) in
charge of R and D,
 DSM was spun-off in 2001 and renamed Wistron
Corporation
RESCUECOM’s Computer Reliability Report- Acer ahead
of Apple
R & D Centre at China- development of Smartphones, TD-
SCDMA technology
 Multibrand strategy

 The 4 brands cater to different customer segments:

1) e machines for price conscious
2) Gateway (in US) and Packard Bell (in Europe) for the middle tier
3) Acer for technophiles
This strategy also helps to gain shelf space in stores

 Acer will be selling netbooks with Google's Android free operating

system (OS)
Google has moved over the years from offering a software with much less
functionality to one that can hit at the core of Microsoft's cash cow operating
system with. With ACER’s move, Microsoft's core business is very likely at
risk
 Acer Joins Open Patent Alliance to Advance Mobile 4G WiMAX
Innovation

 Acer Inc. has joined the Open Patent Alliance (OPA), a group
dedicated to offering intellectual property rights (IPR) solutions that
support the development and widespread adoption of WiMAX.
 The first global PC OEM board member, Acer will help the
proliferation of WiMAX technology, devices and applications around
the world.
Introduction of Netbooks

In 2008, Acer became one of the first 2 companies to offer netbooks using
the free Operating System backed by Google (called Android). To expand
the user base, the netbooks of Acer will run on both XP (Microsoft’s OS) and
Android and allow the users to switch between the two.

In response to this move by Acer, Dell and HP are also came out with their
own Android notebooks.

But, because of the first mover advantage, Acer is the market leader in the
netbook category.
ACER : a tablet leader
ACER was working with Microsoft to produce a first-generation tablet
computer in 2002.Even though being a tablet pioneer, this didn't
work out well for Acer

Focus on corporate clients

2009 onwards, Acer is planning to focus on the corporate clients as
the margins here are roughly double of those in the retail PC market.
New line of servers have been rolled out and additional staff devoted
to corporate sales
Thank you !!!
Ishu Kapoor- 541
Milli Mehra-553
Sonam Anand-544
Sumedh Tucker-551
Tarun Tahiliani-525