INTRODUCTION
1.1 Overview of Haier's Journey
1.
The Haier Group was founded in Qingdao, China, in 1984. The business started off as a
refrigerator manufacturer that was on the verge of going bankrupt. Under the visionary leadership
of Haier, the company has undergone a tremendous transition spearheaded by its founder and
former CEO, Zhang Ruimin. With $35 billion in revenue, Haier is currently the biggest appliance
manufacturer in the world. Zhang laid the foundation for Haier's development as a world leader in
consumer electronics and home appliances by introducing cutting-edge technology and a
customer-centric mindset.
Figure 1- Zhang Ruimin,the founder and
former CEO of Hiear Group
2.
Figure 2- Headquarters on Hiear's main
campus in Qingdo,China
In 1990, Haier had established its supremacy in China and gone global, taking on well-
known firms like Samsung and Whirlpool. Zhang realized, however, that conventional hierarchical
structures were unable to satisfy the increasing demand for speed, innovation, and personalization
as global markets changed. The Rendanheyi model was developed in 2005 as a result of this
insight.
3.
Haier was radically reorganized into a decentralised company under the Rendanheyi
model, which enabled staff members to take on the role of entrepreneurs. This eventually
developed into the Xiaowei system, a network of autonomous microbusinesses with complete
freedom to operate, innovate, and make choices. Haier's current metamorphosis is the result of an
incredible organizational innovation and leadership journey.
1.2 Why Haier’s Model Matters
4.
Haier’s Rendanheyi model represents a groundbreaking shift in organizational
management, especially for companies struggling with traditional hierarchies in the digital era. Its
principles are highly relevant for businesses facing rapid technological advancements, increasing
competition and changing customer expectations.

Decentralization Fosters Innovation: Traditional organizational silos often
hinder creativity and adaptability. Haier dismantled these silos by creating
independent micro-enterprises (Xiaowei), allowing teams to operate like startups
within the organization. This fostered innovation and speed in decision-making.

Employee Empowerment Drives Accountability: Unlike conventional systems
where decision-making is centralized, Haier’s Rendanheyi model gives employees
full ownership of their work. This entrepreneurial approach has resulted in higher
motivation and alignment with customer needs.

Customer-Centricity at the Core: A hallmark of Haier’s approach is its focus on
“zero distance to the customer.” By prioritizing customer needs and involving them
in the product development process, Haier ensures that its offerings remain relevant
and valuable.

Adaptability in a Competitive Market: Haier’s flexible structure enables it to
respond quickly to market changes and launch innovative products tailored to
specific markets. This agility has been critical in helping Haier maintain its
competitive edge globally.
5.
Haier’s experience shows that companies stuck in rigid hierarchies can achieve greater
innovation and operational efficiency by embracing decentralization and empowering their
workforce.
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1.3 Haier’s Key Insights
6.
The Rendanheyi model from the Haier Group provides a convincing road map for
businesses looking to adjust to the demands of the digital era. Haier has shown how companies
may prosper in fast-paced, highly competitive markets by decentralising its organisational
structure and closely coordinating its operations with client demands.
7.
By emphasizing employee entrepreneurship, customer-centricity, and agility, Haier's
success story offers organizations all over the world important lessons.
8.
For companies looking to inspire innovation, engage employees, and remain competitive
in the global market, Haier’s journey is a powerful example of how management innovation can
lead to lasting success.
(2) Key Features of Haier’s Model
2.1 Haier’s Decentralized and Agile Management Approach
Decentralized and agile management is a new organizational model that avoids traditional
bureaucratic hierarchies. This approach fosters flexibility, innovation, and employee
empowerment. Rather than depending on top decision-making, it distributes authority through
small, autonomous teams to enable quicker responses to market changes and customer needs. In
such models, companies let the employees become a valuable part pf the organization by working
independently on all matters concerned with products or services. Employees working for Haier
operate in micro-enterprises-also known as MEs-and operate like entrepreneurs with independence
from approvals in strategy and operation matters from top management. In such models,
accountability rises as the team becomes responsible for its finances, customers, and products.
With decentralization, a company can turn towards or minimize technological changes,
competition rather more quickly, adapting and changing courses as needed. Focusing on autonomy
and entrepreneurship increases employee commitment because people believe that they own what
they do themselves. Decentralization fosters collaboration in an open ecosystem amongst partners,
investors, and other stakeholders contributing to continuous learning and innovation. Companies
also have to implement the appropriate performance measurement systems for dynamic and
autonomous teams.
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2.2 how digital platforms provide real-time data to empower teams to make decisions quickly.
Haier has created a management system that is both decentralized and agile, driven by digital
platforms in real time to empower teams and drive innovation. The company moved from a
traditional hierarchical organization to a network of micro-enterprises-small, autonomous teams
acting like independent start-ups, each responsible for a product or service.
These MEs take decisions quickly, independently, without seeking approval from the top, and are
made possible by the digital platforms of today that allow real-time access to data across different
business functions.
Companies such as Dell has implemented this model in which digital tools provide instant access
to key performance data in almost every dimension of the business. Real-time data access provides
immediate visibility into whether operational metrics, customer feedback, and market trends are
on track, enabling teams to make better decisions quickly and independently from senior
management. Moving away from incremental goals, Haier sets leading targets that allow teams to
be more innovative and adaptive to the dynamic changes in the market.
Haier has also applied digital platforms to enable voluntary collaboration among teams, breaking
down traditional silos that often get in the way of innovation. These platforms enable seamless
communication and data-sharing across departments, helping teams solve problems and seize
opportunities in real time. Teams are empowered to act as CEOs within their MEs: making
decisions based on the data they have at their disposal and driving results with minimum
hierarchical intervention.
2.3 How Haier encourages experimentation and risk-taking within teams.
Haier actively encourages experimentation and risk-taking within its teams by creating an
environment where innovation is highly valued, and failure is viewed as a learning opportunity.
The company has effectively turned its entire organization into a startup factory, with over 50
micro-enterprises incubating contributing to more than 10% of its market capitalization. These
MEs operate in everything from fintech solutions like Hairyongi, which provides loans to small
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businesses, to Express Cabinets, a service that connects farmers directly to consumers through
storage lockers.
Another primary vehicle by which Haier encourages experimentation is by creating multiple
channels for internal entrepreneurship. Employees are encouraged to post new business ideas
online. Others can then collaborate and help the originator flesh out the idea into a viable business.
For example, in the case study Zhang Yi, an aftersales service manager, converted his idea of
Express Cabinets through this approach into a successful venture. The process enables the
employees to take risks, explore new business models, and experiment with innovative solutions
without the rigid bureaucratic structures. Haier promotes experimentation is through the platform
leaders themselves, who call upon insiders and outsiders to put forward their ideas for new business
opportunities, especially when there is unfulfilled market potential or a "white space" opportunity.
This ensures that the risk isn't all taken internally by employees themselves. But also opens the
doors for external innovators to further widen the pool of ideas and views. Haier runs road shows
every month across China, where budding entrepreneurs pitch their ideas to the platform
leadership, members of the investment team from Haier, and others in the innovation network.
2.4 how customer feedback drives quick adaptation of products/services.
Through customer insights, continuously improve and innovate to better match market demands.
The company began experimenting with entrepreneurial sales and marketing teams in 2010, adding
self-managing teams in product units a year later. Initial experiments revealed that internal
contracting and unit negotiations were tough to get right. Teams focused on maximizing their own
unit's success, which led to long and adversarial negotiations. To overcome this friction, Haier
introduced a compensation-linked-to-market-outcome clause. It was now no more about individual
success but about joint collaboration toward aligning up better across teams and jointly creating
customer value. The friction was reduced; teams focused on customer needs which in turn
accelerated the pace of adaptation of products and services to meet market needs.
Zhang, Haier's leader, said that innovation is iterative-in other words, complex systems cannot be
engineered from the top down but must emerge organically through a process of experimentation
and learning. It is this feedback-driven process that has allowed Haier to achieve revolutionary
results through evolutionary means.
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In addition, Haier empowers the employees for entrepreneurship, letting them independently make
certain decisions; this has been making the group ever quick in adjustment to customer reactions.
This humanized management model has removed the bureaucratic obstacles to allow Haier to
function like a startup yet carry the resources and experience of a large organization.
Adapting Haier's Business Model for Enhancing Efficiency and Competitiveness in the Sri
Lankan Apparel Industry
The Sri Lankan apparel industry is a major contributor to the country's economy, generating
significant exports and employment opportunities. However, many companies within the sector
still operate under traditional hierarchical structures, which can result in inefficiencies, slow
decision-making, and a lack of innovation. In contrast, Haier’s business model, which emphasizes
decentralization, agility, and the empowerment of micro-enterprises, offers a more flexible and
responsive approach. By adopting elements of Haier’s model, Sri Lankan apparel manufacturers
could enhance their operational efficiency, increase competitiveness, and better adapt to the fast
changing global market.
Current Scenario in Sri Lankan Apparel Industry
In Sri Lanka, many apparel companies still operate under a traditional hierarchical structure, where
decision-making is concentrated at the upper echelons of the organization. This structure typically
involves multiple layers of management across various functions such as production, marketing,
and sales. While this centralized approach helps maintain control over large-scale operations, it
presents several challenges:

Slow Decision-Making:
The need for upper management approval at each step often leads to delays, hindering the
company’s ability to respond quickly to shifting market demands.

Limited Employee Autonomy:
Employees at lower levels have little decision-making authority, limiting their capacity to swiftly
adapt to customer preferences or market trends.

Innovation Barriers:
With an emphasis on operational efficiency, there is minimal room for experimentation or creative
thinking, which is vital in the dynamic and competitive fashion industry.
In today’s fast-paced environment, where consumer preferences evolve rapidly and demand for
personalized and sustainable products grows, this traditional hierarchical structure may restrict the
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company’s ability to innovate and remain competitive. Adapting to more flexible, decentralized
models could be key to staying ahead in the market.
Haier’s Model and Its Applicability to Sri Lankan Apparel Companies
Haier, a global leader in home appliances, revolutionized its operations by implementing a
decentralized business model, dividing the company into small, autonomous units known as micro
enterprises. Each micro enterprise is responsible for specific product lines and has the freedom to
make decisions independently. This model encourages innovation, speed, and responsiveness to
market changes qualities that are highly beneficial for the apparel industry. Below, we explore
how Haier’s model could be adapted to a Sri Lankan apparel company
Reorganization into Micro-Enterprises
The key principle of Haier’s model is the creation of micro enterprises, small teams with the
autonomy to manage their own operations. These teams are structured around specific product
categories, allowing them to focus on meeting consumer demands and market trends more
effectively.
For example, a Sri Lankan apparel company could establish micro enterprises focused on areas
such as eco-friendly fashion or high performance sportswear. Teams responsible for eco-friendly
apparel could work independently to source sustainable materials, design new products, and create
marketing strategies tailored to environmentally conscious consumers. Similarly, a team focused
on fashion forward apparel could quickly adapt to the latest global trends, enabling the company
to offer fresh designs that appeal to style conscious buyers.
This model aligns with Management by Objectives, where each micro enterprise has clear,
measurable goals that they must achieve independently, such as sales targets, production goals, or
customer satisfaction metrics. These autonomous teams allow for faster decision making, reduced
bureaucracy, and greater ownership of outcomes.
Empowerment through Digital Tools
Haier’s model leverages technology to support decentralized decision-making, and Sri Lankan
apparel companies can do the same. Digital platforms, such as Enterprise Resource Planning (ERP)
systems, Customer Relationship Management (CRM) tools, and social media, can empower teams
to operate more efficiently and responsively.
For instance, by implementing an ERP system, micro-enterprise teams can manage inventory in
real time, track production schedules, and optimize supply chains. This level of transparency
ensures that teams can respond quickly to changes in customer demand, preventing overproduction
or stock outs.
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CRM tools and social media platforms can be used to engage directly with consumers, gaining
insights into their preferences and feedback. For example, if a particular style or material proves
popular on Instagram, the team could quickly adjust production or marketing efforts to capitalize
on this trend. This approach is consistent with Lean Management, a principle that focuses on
minimizing waste and continuously improving processes to deliver more value to customers.
Fostering Innovation through Decentralized Innovation
A significant advantage of Haier’s model is the emphasis on Decentralized Innovation. Each
micro-enterprise has the freedom to experiment and innovate without requiring approval from
senior management. This approach encourages creativity, which is essential in the apparel industry
where market demands are constantly evolving.
For example, a micro-enterprise working on sustainable fashion could experiment with new
materials such as biodegradable fabrics or organic cotton blends. Similarly, a team focused on
high-performance sportswear could collaborate with athletes or experts to design innovative
products that meet specific needs.
This innovation framework is underpinned by the principles of Open Innovation, which seamlessly
incorporates external insights from customers, designers, and various stakeholders into the
company’s product development process. By tapping into a broader pool of ideas, this model
accelerates time to market for new products while cultivating a culture of ongoing refinement and
adaptability. The integration of external perspectives not only enhances creativity but also ensures
that the company remains agile, continuously evolving in response to market demands and
consumer preferences.
Implementing Haier's Agile Model for Enhanced Innovation and Competitiveness in Sri
Lankan Apparel Industry
Adapting Haier’s model to a Sri Lankan apparel company could significantly enhance agility,
innovation, and responsiveness to market changes. By decentralizing decision making into small,
autonomous micro-enterprises, companies can create a more flexible, customer centric approach
to product development and operations. Empowering teams with digital tools like ERP systems
and CRM platforms further enhances their ability to make informed decisions quickly. Moreover,
fostering a culture of innovation through decentralized decision making and open collaboration
will allow Sri Lankan apparel companies to stay competitive in an increasingly fast paced and
globalized market.
By shifting from a traditional hierarchical structure to a more decentralized, agile model, Sri
Lankan apparel manufacturers can unlock new opportunities for growth, innovation, and market
leadership.
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4. Benefits of Haier’s Model for Sri Lankan Businesses
Haier’s decentralized management model offers numerous benefits that could be transformative
for Sri Lankan businesses, particularly in today’s fast-paced, digital-driven market. By shifting
from traditional hierarchical structures to a more agile and customer-centric approach, Sri Lankan
companies can foster a culture of innovation and responsiveness. This model empowers individual
teams to make decisions quickly, enhancing flexibility and adaptability. Additionally, by
leveraging digital tools, businesses can optimize operations, improve efficiency, and better respond
to market trends and customer needs. Embracing this approach could help Sri Lankan businesses
stay competitive, attract top talent, and drive sustainable growth in an evolving global economy.
1. Fostering Innovation
Innovation is a critical driver of success, and Haier’s model provides an ideal framework for
nurturing it. By organizing teams into micro enterprises, businesses give smaller groups the
autonomy to manage entire processes, encouraging creativity and accountability (Fischer & Han,
2019).
In Sri Lanka’s apparel industry, these micro enterprises can focus on niche areas like sustainable
clothing or cutting-edge fashion. For instance, a team dedicated to eco-friendly textiles could
experiment with biodegradable materials or explore partnerships with ethical suppliers. This
structure enables rapid prototyping and quick adjustments to designs based on real-time customer
feedback or emerging trends, providing businesses with a competitive edge in a fast-paced market.
2. Improving Market Responsiveness
In a rapidly changing global environment, businesses must be agile to remain competitive. Haier’s
model excels in creating this agility by empowering decentralized teams to make decisions without
relying on lengthy approval chains (Wang et al., 2018).
For Sri Lankan apparel companies, this adaptability is particularly valuable. For example, if a surge
in demand for sustainable fashion occurs, a micro enterprise focused on green initiatives could
immediately scale up production or introduce new products. Similarly, if customer preferences
shift toward a particular style, decentralized teams can quickly pivot to meet demand.
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3. Enhancing Employee Engagement
Haier’s approach emphasizes employee empowerment, creating a culture where individuals feel
valued and motivated. Decentralized teams have the freedom to make decisions, fostering a sense
of ownership and responsibility (Rothaermel, 2021).
In Sri Lanka’s traditionally hierarchical apparel industry, this change could significantly improve
employee satisfaction. When employees are trusted to manage production schedules, inventory,
and customer interactions, they feel more invested in the organization’s success. This
empowerment not only boosts morale but also enhances productivity, as employees are more likely
to go the extra mile when they see tangible results from their efforts.
4. Increasing Operational Efficiency
The integration of digital tools is another strength of Haier’s model. Digital platforms provide
teams with real-time data, enabling them to optimize processes, manage inventory effectively, and
reduce waste.
For Sri Lankan apparel companies, digital tools could revolutionize operations. For example, a
centralized dashboard might alert a team to inventory surpluses, enabling timely discounts or
adjustments in production. Real-time tracking of customer feedback can help refine designs and
align products with market demands, ensuring resources are used efficiently and waste is
minimized (Jayaratne, 2021).
PART 5
5. Challenges of Adopting Haier’s Model in Sri Lanka.
Haier's business model, particularly its emphasis on decentralization and the extensive use of
digital tools, has proven to be a significant contributor to the company’s success in the global
marketplace. However, adopting this model in Sri Lanka presents several challenges, largely
stemming from issues related to digital infrastructure, cultural resistance, and financial resources.
This report explores these challenges in detail and suggests potential strategies for overcoming
them.
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5.1. Digital Infrastructure and Investment.
One of the most significant challenges to adopting Haier’s model in Sri Lanka is the lack of
advanced digital infrastructure in many businesses, particularly among small and medium-sized
enterprises (SMEs). Haier’s decentralized model relies on the use of cutting-edge digital tools such
as Internet of Things (IoT), artificial intelligence (AI), and cloud-based platforms for data
management, decision-making, and collaboration across various levels of the organization.
However, the costs and barriers associated with adopting these technologies are formidable for Sri
Lankan businesses, particularly SMEs.
5.1.1. Costs of Digital Tools and Infrastructure.
The investment required to implement the necessary digital infrastructure to support a
decentralized model is a significant hurdle. Digital tools such as enterprise resource planning
(ERP) systems, IoT sensors, and data analytics platforms are essential for Haier’s model to
function effectively. However, the high upfront costs of purchasing, installing, and maintaining
these systems can be prohibitively expensive, particularly for SMEs in Sri Lanka. For many small
businesses, these investments are not feasible due to limited access to capital or high interest rates
on loans. Furthermore, the country’s digital infrastructure, while improving, still faces challenges
related to internet connectivity and data security.
5.1.2. Barriers for SMEs.
In Sri Lanka, SMEs account for a significant portion of the economy, yet they often lack the
financial capacity to invest in advanced technologies. These businesses typically operate with
limited budgets and are therefore unable to prioritize the necessary capital expenditure to
modernize their operations. Moreover, many SMEs may not have the in-house technical expertise
to effectively implement and manage complex digital systems. The skills gap in the workforce also
presents a major barrier to the successful adoption of digital tools.
Additionally, Sri Lanka’s digital divide, especially between urban and rural areas, further
complicates matters. In rural or less developed areas, access to high-speed internet, reliable cloud
services, and technical support is often limited, making it challenging for businesses in those
regions to implement a decentralized model reliant on digital tools.
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5.1.2.1. Solutions to Overcome Digital Barriers.
To overcome these challenges, Sri Lankan businesses need to consider collaborations with
technology providers or government initiatives that can offer subsidies or low-interest loans to
assist with the financial burden. There is also potential for creating partnerships between large
corporations and SMEs, where larger firms can share resources, including technical expertise and
digital tools, to help smaller businesses transition to the decentralized model. Additionally, training
and capacity building initiatives are essential to equip employees with the necessary skills to
manage and utilize these digital systems effectively.
5.2. Cultural Resistance to Change.
Sri Lanka’s corporate culture is traditionally hierarchical, where decision-making is centralized
and leaders at the top have significant authority over operations. This structure can be an obstacle
when attempting to introduce Haier’s model of decentralization, which encourages decisionmaking at all levels of the organization. Haier’s model thrives on employee autonomy,
empowering teams to make decisions based on local market conditions and customer needs.
However, such a shift in decision-making power may meet resistance in a culture that values topdown control.
5.2.1. Hierarchical Culture and Resistance.
In Sri Lanka, many businesses are structured with a rigid, top-down hierarchy where leaders make
the majority of decisions. Employees are often hesitant to take on additional responsibilities or
make independent decisions because they are accustomed to clear directives from higher
management. The fear of failure, coupled with concerns about accountability, often leads to
reluctance in embracing greater autonomy. Additionally, employees may worry about their job
security if the decentralization process leads to new roles or shifts in responsibilities.
Furthermore, the shift from centralized control to a more decentralized model may also be
perceived as threatening by senior leaders, who might fear losing control or influence within the
organization. This fear could delay the adoption of Haier’s model, especially if leaders do not fully
understand the long-term benefits of decentralization.
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5.2.2. Overcoming Resistance through Gradual Implementation.
A gradual implementation strategy can help reduce resistance to change. By starting with pilot
projects or small teams, organizations can test Haier’s model in a controlled environment and make
adjustments as necessary before a company-wide rollout. This phased approach allows businesses
to demonstrate success and build confidence in the new model, making it easier for employees to
adapt to the changes.
In addition, strong leadership support is crucial. Leaders must not only champion the change but
also communicate the long-term vision and benefits of the decentralized approach. By involving
employees in the change process, offering training programs, and ensuring that their concerns are
heard, organizations can foster an environment where employees feel empowered rather than
threatened. Leaders should also set a positive example by embracing new technologies and
decentralized decision-making themselves.
5.2.3 Empowering Employees and Ensuring Support.
To ensure a smooth transition, it is essential to empower employees with the right tools and training
to perform effectively in the new model. Providing skills development programs that focus on both
technical and soft skills, such as decision-making and leadership, will be key to ensuring that
employees feel confident in their new roles. Continuous feedback and recognition of achievements
during the implementation process will also help build trust in the new structure.
5.3. Initial Investment and Resources.
Adopting Haier’s model involves significant initial investment in both organizational restructuring
and digital tools. These investments are essential to ensure that the company has the infrastructure
and resources needed to support a decentralized structure. However, the financial burden can be
especially difficult for SMEs in Sri Lanka, which may already be operating under tight budgets
and resource constraints.
5.3.1. Cost of Restructuring and Digital Transformation.
Restructuring an organization to support a decentralized decision-making model requires careful
planning and investment. Changes in organizational hierarchy, management structure, and
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workflow processes are necessary to ensure that teams at all levels have the autonomy to make
decisions. Additionally, the integration of digital tools—such as cloud-based platforms, IoT
devices, and AI systems—adds significant costs. These tools are necessary to enable data-driven
decision-making and collaboration across decentralized units.
Moreover, the costs of training employees to adapt to new technologies and processes must also
be factored into the initial investment. For SMEs, these combined costs of restructuring and
technological investment can be daunting, particularly when short-term financial returns may not
be immediately apparent.
5.3.2. Larger Companies for Demonstrating Success.
One potential solution to mitigate the financial strain is for larger companies to lead the way by
successfully implementing Haier’s model and showcasing the positive impact it has on
organizational performance. Larger companies can use case studies to demonstrate the increased
efficiency, enhanced innovation, and improved market responsiveness resulting from
decentralization. This can help smaller businesses see the long-term benefits of adopting the
model.
Furthermore, large companies can offer mentorship or partnerships with smaller businesses,
providing them with the resources, guidance, and technical expertise needed to successfully adopt
a decentralized model without bearing the full financial burden. This collaboration could involve
sharing software tools, best practices, and training programs.
5.3.3. Government Support and Financial Incentives.
Government initiatives, such as grants, tax incentives, or low-interest loans, can also play a vital
role in facilitating the adoption of Haier’s model in Sri Lanka. By providing financial support for
digital transformation and organizational restructuring, the government can help ease the financial
burden on SMEs and encourage more businesses to embrace the model.
Conclusion
In conclusion, the analysis of Haier's decentralized business model in the context of Sri Lanka
reveals both promising opportunities and significant challenges. The model, which emphasizes
local responsiveness and innovation, aligns well with the dynamic needs of the Sri Lankan market,
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where consumer preferences are rapidly evolving. By empowering local managers and fostering a
culture of entrepreneurship, Haier can effectively tailor its products and services to meet the unique
demands of Sri Lankan consumers, thereby enhancing customer satisfaction and loyalty.
However, the successful implementation of this model is not without its hurdles. One of the
primary challenges is the inadequate digital infrastructure in Sri Lanka, which can hinder the
seamless integration of technology in operations and limit access to vital market data. To overcome
this, Haier must invest in improving digital capabilities, not only within its own operations but also
in collaboration with local stakeholders to enhance the overall business ecosystem.
Cultural resistance to change is another significant barrier that Haier may encounter. The
traditional business practices prevalent in Sri Lanka may conflict with the decentralized approach
that encourages autonomy and innovation. To address this, Haier should focus on change
management strategies that involve educating and training local employees about the benefits of
the decentralized model, fostering a mindset that embraces innovation and adaptability.
Financial constraints among local businesses also pose a challenge to the widespread adoption of
Haier's model. Many small and medium enterprises in Sri Lanka may lack the necessary resources
to invest in new technologies or processes. Haier can play a pivotal role in this regard by offering
financial support, partnerships, or joint ventures that enable local businesses to access the capital
needed for transformation.
Moreover, strategic partnerships with local governments, educational institutions, and industry
associations can facilitate knowledge sharing and capacity building, further strengthening the
implementation of the decentralized model. By collaborating with these entities, Haier can help
create a more conducive environment for innovation and growth, ultimately benefiting the broader
economy.
Accordingly, while Haier's decentralized business model presents a viable pathway for enhancing
competitiveness in Sri Lanka, its success will depend on addressing the multifaceted challenges
that lie ahead. Through targeted investments in digital infrastructure, effective change
management, financial support for local businesses, and strategic partnerships, Haier can not only
navigate these challenges but also position itself as a leader in the Sri Lankan market. The journey
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may be complex, but the potential rewards of increased market share, customer loyalty, and
sustainable growth make it a worthwhile endeavor.
References.
Haier Group. (2020). Haier’s Business Model and Global Success. Haier Business School.
Ministry of Industry and Commerce, Sri Lanka. (2021). The State of SMEs in Sri Lanka:
Opportunities and Challenges.
McKinsey & Company. (2019). Digital Transformation in Emerging Markets: A Guide for SMEs.
International Finance Corporation (IFC). (2020). Access to Digital Technologies for SMEs in
Developing Countries.
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Sheywun, D. (2024 , september 9). Medium. Retrieved from From Mediocre to Major: The
Inspiring Growth Story of Haier, a Global Player:
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