Zhang, president of GISE was of the view that ZISCo could attain sustainable development through value creation on a continuous basis. Undervalue creation strategy, competitive environment analysis is being carried over by comparing the advantages and disadvantages of ZISCo’s strategic management as contrasted to its competitors. The analysis of the value chain exhibited the significance of the integration of activities within ZISCo. By educating the employees on how value creation could enhance ZISCo’s economic performance, ZISCo is able to improve the employee’s confidence in ZISCo’s future.
Zhang was of the opinion that value creation was the aptest strategic management for ZISCo after having analyzed the pros and cons of differentiation and cost leadership. As value creation strategy will involve all activities of the company and was regarded to more suitable than differentiation and cost leadership since it included two features of value creation; fostering value for customers through new product development and aggressive marketing and at the same time fostering value for the company by reducing cost in all functions. Eventually, it could create value for the workforce as their performance would be connected to the ZISCo’s performance.
Thus, the main aim of the company is to develop value creation. Relied on the doctrine of value creation, ZISCo should develop enterprise management and innovative managerial concepts, introduce a value creation strategy, build up a scheme for corporate governance, nurture core competence and generate further value for the organization, its employees, and its customers.
Organizations are regarded as triumphant when they create value for their customers. For instance, health care businesses are said to be booming to the extent that they create value for their physicians, patients, and other stakeholders that trust their service. Value is explained as the magnitude of satisfaction received in retort to the price paid for a product or service. For instance, a patient may undergo cosmetic surgery by remitting heavy fees to a health care unit. In spite of the high price, the experience of increased feeling of self-esteem, social recognition, and enhanced self-confidence may offer an increased quantum of satisfaction that the patient is of the opinion that he has received a high value of service in return. In opposition, the patient may go to a family clinic where services are offered in a disrespected style may consider that they have received either no value at all or a little value. Thus, the value here connotes the perception and relationship that exist between price and satisfaction and not price alone.
ZISCo’s new marketing strategy focused on targeting relatively large market units to be better compatible with ZISCo’s production capacity. Zhang aimed to penetrate into the profitable container market due to its market size, large volume of business, geographical closeness, and ZISCo’s technical competence and production capacity. ZISCo paid close attention to enhance cross-functional communication and interaction between marketing and production and purchase department and more significantly to shore up the marketing concept at ZISCo.
ZISCo also introduced a value creation strategy in the marketing department by offering one-stop services for the Chinese container manufacturing industry. This facilitated a container manufacturer to procure different specifications of steel sheets from ZISCo. As a result, container manufacturers enjoyed substantial savings in procurement costs and hardships in managing inventories as it added major value to customers. ZISCo also gave assurance of on-time delivery to customers.
