Haier Group and OEC

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Author:
elee
ID:
143581
Filename:
Haier Group and OEC
Updated:
2012-03-25 02:01:52
Tags:
Quality Management II
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Description:
Effective OEC Management Control at China Haier Group
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  1. OEC Mgmt control at Haier Group
    • 1984, Haier was nearly bankrupt refigerator factory.
    • 2003, the company global sales hit $9.7 billion with a growth rate of 70% during the previous 19 years.
    • Today, Haier Group reconginzed as a worldwide brand.
    • OEC , O stands for overall. E stands for Everyone, Everything, and Everyday, C stands for Control and Clear.
  2. BUSINESS STRATEGY
    • Haier follow three stage of strategy:
    • Brand building: the company created and built Haier-brand products and set up a quality-assurance system.
    • Expansion or Diversification: Haier decided that if someone bought a Haier Group refigerator, then maybe they would want to buy something else from the firm.
    • Globalization: Haier exported its products to Germany first, then to other European countries, the U.S. Southeast Asian countries, Middle Eastern countries, and India.

    • Two other key business strategies at haier relate to winning over consumers: speed and differentiation.
    • Speed means to satisfy the consumer's needs as quickly as possible.
    • Differentiation means to introduce brand-new products or products with features to meet different needs.
  3. HOW DOES OEC MGMT WORK AT HAIER?
    • Focus on and understand customer value, product quality, operating efficiency, innovation, and speed to market.
    • Commit top mgmt and leadership to creating a "new way of mgmt" and a performance culture.
    • Involve mgmt and employees in creating the OEC mgmt-control system.
    • Educate mgmt and employees.
    • Create desired incentives, and reassure employee that they will be properly evaluated in accordance with their performance.
  4. TARGET SETTING
    • Each division submits a divisional action program form with respect to its annual guidelines and goals.
    • Following are the examples from each of the seven OEC items.
    • Production Plan
    • Quality
    • Technology level and production discpline
    • Equipment
    • Material
    • Labour Displine
    • Production Safety
    • Other Awards and Penalties
    • Endorsement
    • Inspection and Review
  5. Control, checking and clearnace: The OEC daily clearing routine
    • Each team supervisor gives a daily briefing to workers before they start their work.
    • Producion workers conduct their activities by following the seven OEC criteria to check and control
    • Supervisors conduct on-site inspection tours every two hours, detect and solve problems, and complete the product
    • At the end of the day, all workers conduct a self check of their own work with the OEC form with the seven OEC criteria items.
    • At the end of the day, all workers conduct a self check of their own work with the OEC criteria, fill out their 3E.
    • Each supervisor examines the 3E cards, corrects errors, gives a comprehensive evaluation, and submits the evaluation results to the work area manager.
  6. THE EMPLOYEES WHO ARE ACHNOWLEDGED AS THE BEST WORKERS FOR THREE CONSECUTIVE DAYS HAVE THE HONOR OF TELLING THEIR EXPERIENCES TO FELLOW WORKERS.
    • Each work area manager checks the sample 3E cards then fills out his or her own 3E card and submits it to the factory director.
    • Each factory director reviews the 3E cards and records the results in the factory OEC account.
    • The Deputy Division General Manager reviews daily progress reports and suggested soultions and provides feedback defore reorting to the division general manager.
  7. INCENTIVE MECHANISM
    Haier's third subsystem is the incentive mechanism, and is incentive policies are openness and fairness.

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