Milestones & Innovations

1976 – 1986

Commercialize microprocessor technology

Acer's founder, Stan Shih, has always been passionate about sharing knowledge as a
way of contributing to society. Acer actively engaged in teaching others about
microprocessor technology, and promoting computer usage in everyday life. At this
time, the company established its manufacturing operations, and played a significant
role to popularizing the use of computers in Taiwan.

1987 – 2000

Create a brand name and globalize

In 1987, Multitech formally became known as Acer, marking the start of Acer's efforts
toward creating a strong brand name. During this second ten-year stage of
development, Acer grew extensively and expanded its strategic and geographic
footprint to become one of the world's top ten PC vendors. Priority was placed on
delivering the freshest, most affordable technology to benefit consumers worldwide.

2001 – 2007

Transform from manufacturing to services

Acer evolved from a manufacturing powerhouse to a globally-recognized computer

brand, providing world-class IT products and services. Acer's unique Channel Business
Model enabled the company to achieve sustainable worldwide growth. The model offers
flexibility to adapt to changing global IT market trends, involves collaborating with the
industry's top-tier partners and suppliers, while minimizing operating expense and
enhancing profitability. In 2007, Acer ranked as the world's No. 3 PC vendor.

2008 –2013

Enhance worldwide presence with a new multi-brand strategy

With the successful completion of the mergers of Gateway and Packard Bell, Acer
seeks to further strengthen its global footprint with a multi-brand strategy and solid
partnerships.
2014 – beyond

Transforming into a hardware + software + services company

With a new leadership team and new Build Your Own Cloud (BYOC�) vision, Acer is
transforming from a hardware company into a "hardware + software + services"
company as it starts to embrace new opportunities in the era of cloud technology.

Name: Acer Inc.

Founded: 1976

Founder: Stan Shih

CEO: Jason Chen

Industry: Technology

Sector: Public

Country: Taiwan

Website: Acer.com

Acer was established by Stan Shih Chen Jung and his companions in 1976 with an
underlying speculation of $25,000. They named the organization ‘Multitech
International’ and began by planning hand-held electronic amusements and later went
ahead to disperse semi-conductors which they had imported for bringing down
expenses from creating nations.

In 1981, the organization was given the name ‘Acer Inc.’ Their first fruitful item was
the ‘Microprocessor’ which went ahead to furnish them with income for their future
ventures. Next, they began fabricating PC’s which they provided to organizations
which they sold under their settled brands.
Acer was the primary Taiwanese PC organization that went ahead to offer its item
specifically. This was conceivable as a result of putting their benefits into Research
and Development. Along these lines in 1986, it could build up the world’s first
Chinese dialect PC which accompanied an Intel 386 processor.

Acer’s striking moves paid off and at in the year 1988, it had earned $25 million in
benefits as it were. By 1990 Acer’s income had achieved near $1 billion yet it had just
benefits of $4 million. This was expected the moment fall in the costs of PC
equipment worldwide and the reinforcing of the Taiwanese dollar. In any case, Acer
walked ahead by putting resources into new innovation and securing different helpful
organizations.
Acer needed to rapidly concoct a system to enhance their net revenues and keep the
business income developing. They did this by transportation the different parts of 32
areas around the globe for a get-together. The consoles, housings were sent to various
nations in extensive amounts by dispatch.

The motherboard was continually refreshed so it was sent via air as and when there
was a request. The CPU and the hard drive were at that point costly segments so as
opposed to transportation them, they were procured from the neighboring nation.
This methodology helped in diminishing the expenses of generation and keeping the
nature of the item as high as could be allowed. By 1995, Acer could turn into the main
offering PC mark in nations like Philippines, Thailand, Chile, Mexico, Uruguay, and
Taiwan. In 1993 Acer could record benefits of $75 million.

In 1994 it could reach $3.2 billion in income out of which $210 million were benefits.
It had crossed makers like Dell, Toshiba, and Hewlett-Packard to wind up plainly the
ninth biggest producer on the planet. In 2007 Acer obtained two of its opponents
Packard Bell and Gateway so as to dispatch itself to wind up plainly the greatest PC
merchant on the planet.

Its children’s story travel has proceeded with from that point onward and it went ahead
to end up plainly the fourth biggest PC producer of the world in 2012. In the year
2011, Acer has $16 billion in income with more than 7,500 representatives. Today
Acer has differentiated its scope of items to incorporate ease desktops, portable
workstations, servers, stockpiling gadgets, peripherals and furthermore the most
recent cell phones, tablets, and so on.
From being a seaward provider for enormous organizations to contending with
perceived brands Acer has been gallant at each progression to make strong strides that
have helped its colossal development. Acer’s enthusiasm for development has taken it
to levels that few could envision and with the development, it is encountering it will
without a doubt have the capacity to accomplish any objective that it sets for itself.

Acer Client Virtualization Solution Success Story

Zhouqu Senior High School in the Gansu Province,
China.

Four years ago, Zhouqu Senior High School had gone thru a devastate disaster, the “8.8 Mud Slide” with
over 1200 death, 490 people missing, and over 2300 people injured. The whole city was nearly torn
down and needed rebuild. This instance did not knock the city down, but stood up strong and re-built a
better city and school.

After four years, Zhouqu Senior High School is now one of the most prestigious and has been selected as
the role-model school in the Gansu Province, China. The recently built school has the most modernized
buildings and facilities which accommodating up to 3000 resident students and nearly 200 teachers are
from China’s finest universities. The school is constantly seeking creative teaching skills as well as
offering the most advanced technology into the school curriculum.

After 2 years of rebuilt after the “8.8 Mud Slide”, the school is hungry for new information, and eager
to get hands on everything they could to re-connect to the world. They need to quickly access to the
outside world, and need to know how to retrieve information even the disaster strikes again. They
require information backup as they have learned how the world could change in overnight from any
force majeure instance. They need to educate the students the newest information even they are in
rural area and need to have computer system up and running with minimum IT resource.
They turn this request to Acer and ask Acer to provide a best solution to adapt their requirement. Acer
understands this school requires very high standards of quality as the school has been chosen as the
role model school. Thus the solution has to be robust, proven, ready-to-use, and scalable for future
expansion.

Acer China teams up with software and system integrator to propose “Acer Client Virtualization T
Solution.” The solution composes of Acer multi-CPU servers, Cloud Client Desktops, Virtualization
Solution Software, overall system integration, training, and and services.

Prior to the full implementation of The Acer Client Virtualization T Solution, Acer and Acer partners
conducted the Proof of Concept to ensure all the required features and infrastructures had met the
schools rigorous standards and functionalities before the full blown implementation. During the Proof
of Concept stage, system was being virtualized connecting with intelligent cloud clients. The solution
was able to optimize resources, allowing selected faculties and students using the same platform, using
the system console to make management easier to and operate, and most importantly, IT administrator
was able to remotely create/delete/monitor student accounts.

Acer Client Virtualization Solution is delivering Zhouqu Senior High School the service and solution
that they have truly been waiting for. Student and faculties access the system through cloud client
stations using individual and secured account. The applications are being shared among all students
and faculties with security and privilege control, thus it greatly reduces both hardware and software
expenditure. Moreover, IT resources are being optimized; there are no redundant or unused servers.
This solution is easy to manage perfectly fitting into current schools limited resources. In addition,
storage is also centralized making both IT and users easy to access as well as for IT administrator to
backup and monitor its capacity quickly. The solution comes with Cloud Client Desktops. These
desktops are great for classroom with low noise, consuming very little power, and spacing saving.
Students will get hands on them easily and quickly. The desktop design also meets many of
environmental friendly standards.

The Gansu Zhouqu Senior High School officials are very pleased after the solution is being
implemented. The feedback from both students and faculties are all very positive. School officials are
very proud to be the pioneer to use it with such success. This solution has started with 101 Cloud Client
Desktops, but this solution has become the de facto standards for cloud based solution in education
now. This solution has boosted Acer and partner with confidence, as the school plans to use the same
solution in other places such as offices, multimedia classrooms, and library.

Executive Profile
Stan Shih
Consultant, iD TechVentures Inc.

Age Total Calculated Compensation This person is connected to 3 Board Members in 3 organization
across 7 different industries.
74 --
See Board Relationships
Background
Mr. Chen-Jung Shih, also known as Stan, Ph.D., served as an Interim Corporate President of Acer Inc.
from November 21, 2013 to January 1, 2014. Mr. Shih serves as an Advisor to Taiwan Medtech Fund of
National Development Fund, Executive Yuan. He is employed iD TechVentures Ltd. He co-founded Acer
Inc. in 1976 and was a Partner of iD Innovation Inc. He served as the Chairman of Acer Inc., from March
1, 2002 to December 31, 2004 and its Chief Executive Officer until December 31, 2004. He began his
career at Unitron Industrial Corp. in 1971 and successfully designed, developed and commercialized
Taiwan's first desktop calculator. Later in 1972, he helped establish Qualitron Industrial Corp. and led the
team that designed the world's first pen watch. In September 1976, he Co-founded Multitech International
Corporation. Mr. Shih serves as Group Chairman at iD SoftCapital. He served as Honorary Chairman of
Acer Inc. and served as its Chairman from November 21, 2013 to June 18, 2014. He served as the
Chairman of iD Ventures America, LLC. He has been an Independent Director of Taiwan Semiconductor
Manufacturing Company Limited since April 14, 2000. He serves as a Director at BenQ Corp., Acer
Investment Inc., TSMC Co. LTD., Aspire Service & Development Inc., Acer Property Development Inc.,
Cross Century Investment, Nan Shan Life Insurance Company, Ltd., Acer SoftCapital, Dragon Investment
Co., Ltd. and Acer Worldwide Inc. He has been a Director of Acer Inc since June 18, 2014; Public
Television Service since July 2, 2013 and Acer Inc., since June 14, 2005. He served as a Director of
Qisda Corporation since June 26, 2014 until July 4, 2017 and Wistron Corporation since June 8, 2006
until June 14, 2018. Mr. Shih served as a Director of Applied Materials, Inc. since 2000. He served as a
Director at Nan Shan Life Insurance Company, Ltd. He actively contributes to social and public
organizations. He was the Chairman of National Culture and Arts Foundation, R.O.C. In 2003, he was
interviewed for CNN's TalkAsia and described as 'A visionary from Taiwan who has put the island on the
global IT map.' In 2000, he was selected amongst “Asia's top 25 Digital Elite” by Asia Week's first annual
look at the people shaping Asia's high tech future. In 1997, he was honored in the “Business Hall of
Fame” by Asia Week. In 1999, Computer Reseller News and The Computer Museum History Center
inducted him into their “3rd annual Industry Hall of Fame“. In the same year, the Academy of International
Business also selected him as “International Business Executive of the Year”. He was selected by
Business Week as one of “The 25 Top Managers of the Year” for 1995. In 1989, Fortune magazine chose
He among “25 People You Ought to Know for Doing Business in Asia”. In 1976, he was awarded one of
the Ten Most Outstanding Young Persons in Taiwan. He has received numerous awards. He was the first
Asian Chief Executive Officer to be awarded by Thunderbird American Graduate School's highest honor,
the Degree of Doctor of International Law, in recognition of his exceptional leadership in the business
world. Mr. Shih obtained an honorary Ph.D. in Electrical Engineering, an M.Sc. and a B.Sc. in Electrical
Engineering from National Chiao Tung University. He was awarded Honorary Degree of Doctor of
Technology by the Hong Kong Polytechnic University in 1997. • Council member of Asian Corporate
Governance Associate (ACGA) • Chairman of Stan Shih Foundation • Director of Egis Technology Inc.;
Digitimes Inc.; Chinese Television System Inc.
Corporate Headquarters Annual Compensation
Room 1003 There is no Annual Compensation data available.
Shanghai, -- 200001

China Stocks Options

There is no Stock Options data available.
Phone: 86 21 6386 8708
Fax: 86 21 6386 8709 Total Compensation
There is no Total Compensation data available.
Board Members Memberships
2000-Present

Independent Director

Taiwan Semiconductor Manufacturing Company

Limited

2013-Present

Director

Public Television Service

2014-Present

Director

Acer Incorporated

Education
Doctorate 1997

The Hong Kong Polytechnic University

Honorary Doctorate 1992

National Chiao Tung University

MS 1971

National Chiao Tung University

BS 1968

National Chiao Tung University

Other Affiliations
Applied Materials, Inc.

Taiwan Semiconductor Manufacturing Company

Limited

iD Ventures America, LLC

Acer Incorporated

Qisda Corporation

Wistron Corporation

The Hong Kong Polytechnic University

National Chiao Tung University

Nan Shan Life Insurance Company, Ltd.

Acer Corporation

National Development Fund, Executive Yuan

iD Innovation Inc.

Public Television Service

Taiwan Medtech Fund

9F, 88 Hsin Tai Wu Rd., Sec 1

Hsichih, Taipei 221
Taiwan
Telephone: 886-2-696-1234
Fax: 888-2-696-3535
Web site: http://www.acer.com
Public Company
Incorporated: 1976 as Multitech International
Employees: 6,560
Sales: $7.03 billion (2004)
Stock Exchanges: Taiwan
Ticker Symbol: ACER
NAIC: 334111 Electronic Computer Manufacturing; 334613 Magnetic and Optical
Recording Media Manufacturing; 334290 Other Communications Equipment
Manufacturing; 334119 Other Computer Peripheral Equipment Manufacturing; 334310
Audio and Video Equipment Manufacturing; 511210 Software Publishers
Acer Incorporated is Taiwan's leading exporter and the world's fifth largest computer
manufacturer. The company designs, manufactures, and sells computer hardware and
software products; it ranks among the world's largest manufacturers of individual
components such as keyboards, motherboards, set-up boxes, storage drives, monitors,
CD-ROM drives, keyboards, printers, scanners, and software. Acer's nearly 30 years of
growth results primarily from its business of manufacturing and assembling branded and
contract PCs in several locations throughout the world. The company sells its products
through dealers and distributors in more than 100 countries.
Taiwan's high-tech industry pioneer Stan Shih cofounded Acer. Over the years Shih
guided his company through several corporate restructuring processes as well as
financial ups and downs of the 1980s and 90s. In a significant restructuring in 2000 Acer
spun off its lucrative contract manufacturing business and renamed it Wistron
Corporation. This helped position Acer on a growth curve in several markets. When
Stan Shih retired in early 2005 Acer's branded products had strong sales figures
worldwide, and the company was poised to make a larger impact in the U.S. market
through its desktop and notebook PCs.

Business Origins
Acer's founder was born Shih Chen Jung in 1945. A shy youth, Shih blossomed at
National Chiao Tung University, where his natural math aptitude helped him graduate at
the top of his class. Shih, who later westernized his given name to Stan, earned a
master's degree in 1972 and went to work as a design engineer at Qualitron Industrial
Corp.
It was not long, however, before the entrepreneurial bug bit Shih; in 1976, he and
several friends founded Multitech International with a $25,000 initial investment. The
new firm started by designing hand-held electronic games, then expanded into the
distribution of imported semiconductors. Shih renamed his company Acer Incorporated
in 1981. The name was derived from the Latin word for acute or sharp.
The company enjoyed its first international success that year with the launch of
MicroProfessor, a teaching tool. The company began manufacturing PC clones—
computers and components that were sold to larger companies with strong brand
names—in 1983. Acer diversified vertically in the late 1980s, soon becoming "one of the
most vertically integrated micro-computer manufacturers in the world," according to Los
Angeles Business Journal.
In 1995, Fortune 's Louis Kraar called Stan Shih "a fascinating combination of
engineering nerd, traditional Chinese businessman, avant-garde manager, and
international entrepreneur, with an outsize ambition and vision to match." The young
CEO applied all of these talents to his young enterprise. In stark contrast to the
micromanagement, nepotism, and profit-taking typical of Taiwanese companies, Shih
established a modern, progressive corporate culture. Although Shih's wife, Carolyn Yeh,
served as the company's first bookkeeper, the founder vowed that his three children
would have to look for jobs elsewhere. Time clocks were anathema, even in production
plants. In 1984 he established Taiwan's first stock incentive program. Within four years,
3,000 of Acer's employees were also stockholders.
In 1981, Acer hinted at a sweeping change in strategy with the establishment of Third
Wave Publishing Corp. The term "third wave" referred to the most recent phase of the
history of Taiwan's computer industry: the first was characterized by trademark and
patent piracy, the second by clonemaking, and the third by technological innovation.
Instead of simply churning out other companies' designs, Acer began to set itself apart
from most of its Taiwanese competitors by doing its own research and development.
For example, the company developed one of the world's first Chinese language
computer systems. In 1986, Acer was second only to Compaq to introduce a 32-bit PC
with an Intel 386microprocessor.
Acer went public in 1988, having chalked up average annual growth of 100 percent from
1976 to 1988. In 1988, net profits totaled more than $25 million.

Early 1990s Setbacks

The late 1980s brought internal and external changes that had a devastating effect on
Acer. The internal problems were completely unexpected. In 1989, Shih hired Leonard
Liu away from a 20-year career with International Business Machines Corp. (IBM),
making him president of the Acer group and chairman and chief executive officer of
Acer America Corp. Described in an October 1995 Fortune article as "a cerebral Ph.D.
in computer science from Princeton," Liu had previously been the "highest-ranking
Chinese American executive" at IBM. Liu's managerial style reflected his experience at
"Big Blue": in contrast with Shih's traditionally progressive corporate culture, Liu tried to
centralize control of Acer. His offputting approach has been blamed for a management
exodus in the early 1990s.
At the same time, the computer industry quickly matured, shifting from a high profit
margin business to a low margin commodity practically overnight. Price wars pushed
component prices down so rapidly, and a strong New Taiwan dollar made the country's
goods so expensive, that it became difficult to make a profit on the finished product.
Acer's sales rose from $530.9 million in 1988 to $977 million by 1990, but its profits
dropped from $26.5 million to $3.6 million during the same period. In 1991, Acer posted
its first ever annual loss, $22.7 million. More than $20 million of that shortfall came from
Acer America, which had struggled since its inception. Acer's stock dropped to 50
percent of its initial public offering price. Shih had to sell Acer's headquarters to make a
profit in 1992.
These difficulties, however, did not deter Shih from making several expensive, and oft-
criticized, expenditures during the late 1980s and early 1990s. In 1989, Acer invested
$240 million in a joint venture with Texas Instruments and China Development
Corporation, a Taiwanese development bank. The cooperative enterprise built Taiwan's
first DRAM (dynamic random access memory) factory. Half of its output was sold to
Acer, and the other half was sold on the world market. Some industry observers
ballyhooed the project, noting a glut in the global DRAM market. Acer also expanded
production capacity at its main plant, spent $36 million on a global marketing campaign,
and made questionable acquisitions in the United States and Germany. Financial
World 's Jagannath Dubashi was skeptical that the company's investments would pay
off, noting in her July 1991 coverage of the company that "this new aggressiveness
seems both poorly timed and unrealistic." She even characterized the company's bold
moves as "a desperate gamble."
At the time, Shih would have been the first to agree with such an assessment. In
January 1992, he offered to resign from the company he had founded. Acer's board of
directors turned down Shih's resignation, but accepted Leonard Liu's withdrawal three
months later. By mid-year, Shih had resumed dayto-day administration of Acer and its
American subsidiary.
Instead of being cowed by the setback, Shih was determined to cement Acer's future in
the PC industry by transforming it from just another OEM into one of the world's leading
computer brands. He would achieve this goal via several revolutionary strategies.

New Methods Pace Mid-1990s Turnaround

In a 1995 Financial World article, Shih compared Taiwanese computer manufacturing to
Chinese restaurants, saying that "Chinese food is good, and it is everywhere, but it has
no uniform global image or consistent quality." The same was true of personal
computers; although most were made in Taiwan, they were sold under several
(primarily American and Japanese) brands, with varying levels of quality. Shih wanted
Acer to be more like McDonald's, the quintessential fast food restaurant that boasted a
strong brand image and strict quality standards.
This unique paradigm shift required a complete overhaul of Acer's production and
distribution scheme. Instead of assembling computers in Taiwan, as it had done for
more than a decade, the company began to ship components to 32 locations around the
world for assembly. Shih compared computer components including casings,
keyboards, and mice to such staples as ketchup and mustard that could be shipped
slowly and stored indefinitely. He likened the motherboard, which had to have the
"freshest" technology possible, to the meat in a sandwich. It was shipped by air from
Taiwan to each assembly operation. Finally, Shih compared the CPU and hard drive to
"very expensive cheese: we try to source them locally." Shih's adoption of this unique
strategy earned him the nickname "the Ray Kroc of the PC business."

Company Perspectives:
Acer ranks among the world's top five branded PC vendors, designing and marketing
easy, dependable IT solutions that empower people to reach their goals and enhance
their lives.
This production scheme saved on shipping costs and enabled Acer to include the most
up-to-date (Shih liked to call it the "freshest") technology available. In Acer-speak,
"fresh" meant innovative. Not content to rely on low-end knockoffs of other companies'
technology, Acer stayed abreast of the industry's latest developments. In 1992, it
launched a multi-user UNIX system as well as 386- and 486-based PCs. That year also
saw the introduction of an international service and support network, a vital element of
any successful PC business in the 1990s. In 1993, Acer unveiled a new PC that came
equipped with a RISC (reduced instruction-set computing) chip and Microsoft's most
recent version of the Windows operating system.
Shih hoped to bring the "fast food" concept all the way to the retail level, so that
customers could custom-order computers with peripherals and memory capacity
specifically suited to their needs. Acer tested this concept at a company-owned retail
store in Taipei. It seemed to be as close as Acer could come to McDonald's-style
service: only two hours passed from the time a system was ordered to the time it was
booted.
Shih's "global brand, local touch" strategy was closely related to the "fast food"
distribution concept. Instead of creating a series of centrally controlled foreign
subsidiaries, Acer established a network of virtually autonomous affiliates, much like a
fast food franchise system. Each of these affiliates was managed by a group of locals
who determined product configurations, pricing strategies, and promotional programs
based on national or regional preferences. The affiliate would usually have just one
Taiwanese person on staff to facilitate interorganizational communications. Sales &
Marketing Management characterized the system as a "revolutionary departure from the
traditional hierarchical model of worldwide branches and subsidiaries reporting to a
head office." Instead, it was "a commonwealth of independent companies, united only in
their commitment to a common brand name and logo."
This strategy gave each Acer affiliate the semblance of a local company, an image that
carried with it several benefits. Perhaps most important, it helped to downplay Acer's
Taiwanese roots. Despite the country's large strides in the area of quality, "made in
Taiwan" continued to carry negative connotations in the minds of many consumers.
While Shih was proud of his company's heritage, individual affiliates often found it
efficacious to de-emphasize that aspect of the business.
Globalization at Acer employed a third strategy adapted from an Asian chess-like game
called "Go." Instead of jumping directly into the world's largest and most important
computer markets, Acer conquered the surrounding markets before entering the United
States. For example, Acer established itself as the leader in less hotly contested
markets in Latin America, Southeast Asia, and the Middle East. By 1995, it was the
topselling computer brand in Mexico, Bolivia, Chile, Panama, Uruguay, Thailand, and
the Philippines, not to mention Taiwan.
This combination of tactics worked quickly and well, vindicating many of Acer's
previously criticized moves. In 1993, Acer posted record profits of $75 million; 43
percent of that year's net was generated by the DRAM joint venture, considered "the
most efficient in the DRAM industry" by some observers. From 1994 to 1995, Acer
advanced from 14th to ninth among the world's largest computer manufacturers,
surpassing Hewlett-Packard, Dell, and Toshiba. Total sales grew to $3.2 billion in 1994,
and net income increased to $205 million, as Acer America turned its first annual profit
in the 1990s.

Strategies for the Mid-1990s and Beyond

In the mid-1990s, Acer began to globalize production as well as assembly, building a
keyboard and monitor plant in Malaysia in 1994. The company planned a motherboard
and CD-ROM factory for the Philippines and hoped to set up production in Argentina,
Chile, Thailand, Dubai, South Africa, Brazil, India, the People's Republic of China, and
the former Soviet Union.
In 1994, Shih unveiled a plan to "deconstruct" Acer into 21 publicly traded business
units by the end of the 20th century. Acer Inc. would continue to own anywhere from 19
percent to 40 percent of the firms' stock, but Shih hoped that their independent status
would enable the individual units to compete more effectively by facilitating
entrepreneurship, inspiring research and development, and allowing for corporate
fundraising through stock and bond offerings. Michael Zimmerman of PC
Week speculated on another possible motivation behind the plan, known internally as
"21-in-21." His June 1994 piece on Acer noted that "Separating the divisions will also
clear a path for Shih to retire and, as one observer said, 'to leave his legacy intact' by
not risking the future of his brainchild to a successor." In fact, Shih told PC Week that he
"expects to withdraw from Acer and the workforce" by 1999.
Acer Computer International, the company's Asia-Pacific distributor, had its initial public
offering in September 1994. The approximately $55 million flotation was oversubscribed
by about 20 times. Spinoffs of Acer Peripherals, the corporation's manufacturer of
keyboards and monitors, and Acer Sertek, the Taiwanese distribution operation, were
planned for 1996. Stock in Acer America and certain Latin American operations was
slated to go on the auction block by 1997.

Key Dates:
1976:
Multitech International is founded by Stan Shih and four others.
1981:
Multitech is renamed Acer, Inc.
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.

The Economist reported that Acer's revenues had increased by 75 percent from $3.2
billion in 1994 to $5.7 billion and that Shih hoped to increase that figure to $15 billion by
1999 via expansion into consumer electronics including televisions and fax machines.
Global sales did strengthen, but Acer's performance lagged in the U.S. market due to
intense competition from rivals with stronger brand presence.
Acer America was reorganized in both 1996 and 1997 in an attempt to stem the tide of
loss. In 1997 Acer America lost $141 million. This had a significant impact on the
company's bottom line because at the time, one third of Acer Inc.'s business was in
North America. Its branded PCs were ranked ninth in sales in the U.S. PC market. That
same year Acer America purchased Texas Instruments' notebook sector.
On a global scale, Acer was seeing a turnaround; its net profits in 1997 were $115
million, up 22 percent from the previous year. That year Acer negotiated significant
partnerships with IBM and Apple to manufacture PCs. At the time it had 37 assembly
sites worldwide, but no manufacturing outside of Asia. Later that year the company
opened its first manufacturing plants outside of Asia, in Mexico, in order to reduce
shipping time to the Latin and North American markets. By late 1998 Acer was the top
brand in South Africa, Mexico, and several other emerging markets.
While Acer had successfully concentrated its efforts on emerging markets, corporate
leaders were still dissatisfied with its weak showing in the United States and Europe. In
the United States, Acer's share of the PC market slipped from 5.4 percent of PC sales in
1995 to 3.2 percent in late 1998. In an effort to recoup some of that market share, Acer
America planned to streamline efforts toward less complicated systems targeted toward
schools, governments, and businesses.
In 1998 Acer reorganized into five groups—Acer International Service Group, Acer
Sertek Service Group, Acer Semiconductor Group, Acer Information Products Group,
and Acer Peripherals Group. Two years later that corporate restructuring did not appear
to have made a significant impact on the company overall, and stock prices were
sliding. Shih restructured again. To dispel complaints from clients that Acer competed
with its own products and to alleviate the competitive nature of the branded sales vs.
contract manufacturing businesses, Shih spun off the contract business, renaming it
Wistron Corporation. The restructuring resulted in two primary units—brand name sales
and contract manufacturing. The restructuring also resulted in Acer breaking off several
of its smaller operations, including semiconductor design, consumer electronics, and
liquid-crystal displays.
Early signs indicated that the spinoff strategy had worked well, especially in Europe,
where Acer became a popular PC brand. In 2003, company sales increased 48 percent
to $4.6 billion, and helped Acer surpass Japan's Toshiba and NEC, making it the world's
fifth largest manufacturer of PCs.
Acer had also adopted a more focused "channel" approach to distribution. Instead of a
multi-tiered strategy, the company simplified the sales/distribution process by
eliminating direct sales, and fostering closer working relationships with dealers and
distributors. Acer also focused on selling to corporations through distributors rather than
trying to win the sales from individual consumers.
The restructuring, combined with the 100 percent focused channel strategy, increased
Acer's success in the European markets. Acer applied the same channel strategy in the
United States, where sales figures eventually began to turn around—so much so that
Acer America was on track to break even by the end of 2004. Acer America had also
worked hard to reinforce product support services since early 2000.
By late 2004, the industry rankings were in Acer's favor. In Europe Acer was number
two in PC brand sales in the second quarter of 2004. In the third quarter, Acer was the
top PC notebook brand in Italy and Germany, the region's biggest PC markets. Acer
had also climbed to number three in PC shipment volume to the entire pan-European
market which included the Middle East and Africa.
Gianfranco Lanci, who had overseen and orchestrated Acer's success in Italy and then
throughout Europe, began managing the U.S. market operations. Lanci became Acer
president, and president J.T. Wang was promoted to CEO, while Stan Shih planned to
retire. After putting it off for several years, Shih finally announced his upcoming
retirement, sensing his company was in good hands and positioned for continued
growth.
Forecasting into 2005, the company anticipated its global revenue would increase by 30
to 40 percent. Acer leaders hoped to become the world's third largest PC maker by
surpassing Fujitsu Siemens Computers and IBM. To reach that goal, Acer planned to
further expand desktop market penetration. At the time notebook PC sales represented
58 percent of Acer's earnings. Comfortable with its leading presence in Asia and
Europe, the company was ready to position itself to increase sales in China and North
America, turning up the competitive heat on rivals Dell and Hewlett Packard.

Principal Subsidiaries
Acer Computer International; Acer Information Products Group; Acer Internet Services;
Acer NeWeb Corp.; Acer Peripherals, Inc.; Acer Property Development, Inc.;
Acer Semiconductor Manufacturing; Addonics Technologies Corp. Aegis Semiconductor
Technology; Aopen, Inc.; Acer Technology, Inc.; Darfon Electronics Corporation; Hitrust
Incorporated; Vision Tech Information Technology; Weblink International, Inc.; Wistron
Nexus Inc.; Acer America Corporation (U.S.A.); Acer Latin America, Inc.; Acer
Peripherals America, Inc.; Acer Africa Pty. Ltd.; Acer America Corp. (Canada); Acer
CIS, Inc. (Russia); Acer Computec Latino America S.A. (Mexico); Acer Computer
Australia Pty. Ltd.; Acer Computer Benelux (Netherlands); Acer Computer Co., Ltd.
(Thailand); Acer Computer Czech and Slovak Republics; Acer Computer (Far East)
Limited (Hong Kong); Acer Computer Finland Oy; Acer Computer France S.A.R.L.; Acer
Computer GmbH (Germany and Poland); Acer Computer Handels gmbH (Austria); Acer
Computer Iberica S.A.U. (Spain); Acer Computer (Singapore) Pte. Ltd.; Acer Computer
Magyarorsz-g (Hungary); Acer Computer (M.E.) Ltd. (United Arab Emirates); Acer
Computer New Zealand Ltd.; Acer Computer Norway A/S; Acer Computer Sweden AB;
Acer Computer (Switzerland) AG; Acer Computer Turkey; Acer do Brasil Limitada; Acer
India (Pvt.) Ltd.; Acer Information Services International (Costa Rica); Acer Italy S.r.l.;
Acer Japan Corporation; Acer Marketing Services (China); BenQ (formerly Acer
Peripherals Holland) (Netherlands); Acer Peripherals Japan; Acer Peru S.A.; Acer
Philippines, Inc.; Acer Sales and Service Sdn.Bhd. (Malaysia); Acer Scandinavia A/S
(Denmark); Acer UK Limited; Acer Vietnam Co. Ltd.; ONC Technologies Inc. (South
Korea); PT Acer Indonesia; Servex Singapore Pte. Ltd.

Principal Competitors
Dell Inc.; Fujitsu Siemens Computers (Holding); Hewlett-Packard Company; NEC
Corporation.

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Essays

Commerce

The History Of Acer Incorporated Business Commerce Essay

4917 words (20 pages) essay in Commerce

5/12/16
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Acer Inc. was founded by Stan Shih, his wife Carolyn Yeh, and a group of five others as Multitech
International in 1976. Acer is headquartered in Hsinchu City, Taiwan. It began with eleven employees
and $25, 000 in capital. Initially, it was primarily a distributor of electronic parts and consultant to
microprocessor technologies, but overtime it emerged as a PC manufacturer. In 1997 Acer began its
incursion into laptops with the purchase of Texas Instruments mobile PC division. Acer has an impressive
timeline starting from it conception in 1976. (Acer, 2010)

In 1976 to 1986 Multitech begins with the commercialization of microprocessor technology. At this time
Multitech establishes manufacturing operations, and plays a significant role in commercialization of the
use of computers in Taiwan. (Acer, 2010) According to Honi, Tarng, & Chu the products functional
differentiation was an important basis for competition. Acer in order to handle various costumer needs
became vertically integrated. This structure allowed Multitech to achieve coordination between the
steps in the value chain by making purchasing choices administratively. (Honi, Tarng, & Chu, 2000)

As IBM compatible computers become the dominant design which forced the new PC industry to change
the competitiveness criteria. This change forced the PC industry to undergo a structural change from
vertical integration to vertical disintegration. (Honi, Tarng, & Chu, 2000) In such specialization
environment, companies coordinate with other through external transactions. (Honi, Tarng, & Chu,
2000) PC technology changes rapidly making the PC product life cycle shorter.

1987 to 2000 Acer expanded its strategic and geographic grip of the PC industry and becomes one of the
top ten PC retailers. Multitech changes its name and becomes Acer. By this time Acer has a growth rate
of 45 %. Acer acquires the Texas Instruments mobile PC division in 1997. It is the acquisition of the
mobile PC division that gives Acer the opportunity to invade the PC manufacturer sector of the business.
(Acer, 2010) Acer at this time has relatively limited resources compared to IBM, HP, or Toshiba. However
Acer s success is based on their ability to operate in a rapidly technologically changing environment,
logistics. (Honi, Tarng, & Chu, 2000) In 2000 as part of Acer s re-engineering, splits off its OEM
manufacturing business unit, and changes its focus to global marketing of its brand products. (Acer,
2010)

2001 to 2007 Acer evolves from a producer powerhouse to a globally recognized computer brand. Acer s
utilization of the Channel Business Model provides Acer with the ability to maintain business growth.
(Acer, 2010) Acer explains the Channel Leveraged Business Model as placing the customers at the center
of their business and surrounding themselves with dedicated, quality partners. By creating this process
Acer allows their clients to have the speed, choice and flexibility to make it easy to work with Acer.
(Acer, 2010) Acer does this in different ways: committed partnerships with open communication
conduits.

Characteristics to Innovation and Changes in Acer

Acer has an established network of Channel Partners that helps deliver service and support. Their
ecommerce infrastructure streamlines business transactions. This model gives Acer the strength of
relationships with supply chains that give the company speed and flexibility, information, and service
delivery wit no single point of failure. (Acer, 2010) Partnerships give Acer the leverage that it could not
have by itself. Leverage that the partners existing infrastructure has such as supply chains and
distribution which in the end minimize costs to the company and ultimately the consumer. (Acer, 2010)

Honi, Tarng, & Chu refer to the Channel Business Model as joint venture and collaboration. Some of the
risks in specialization come from both demand and supply sides. The benefits of
collaboration/partnerships are numerous, particularly when the companies are operating in a volatile
environment. Honi, Tarng, & Chu mention as an example that as innovation is expected to be more
frequent, sharing of information in the design stages between key players in the chain reduces the time
to bring new products to the market.

Partnerships in this type of business environment are no longer confided to two way alliances. Today s
groups are linked together for common purposes. Within a network or group, companies may be linked
together through joint alliances, or collaborations. (Acer, 2010)

Since a specialized firm can focus on its core competence to obtain reaching economies of scale, getting
the learning curve and receiving benefits from corporate advantages the firm can reduce its average
costs rapidly and perform business functions efficiently. (Honi, Tarng, & Chu, 2000)

2007 2008 Acer mergers with Gateway, E-ten Info Systems Co. Ltd. and Packard Bell which strengthens
their global presence with a new multi-product approach and has strengthen its partnerships. Acer s
goal is to close the gap from the world s number two PC maker. Acer comes out with the New Aspire
Gemstone Blue design as the first series of notebook to incorporate full HD 18.4 and 16 LCDs with extra
wide 16:9 aspect ratio, Blue-Ray Disc drive, and Dolby Surround. Acer enters the high-end gaming
market with the launch of the Aspire Predator series. The Predator offers two-way and three-way
NVIDIA, SLO visuals with 1.5 GB dedicated to high performance graphics. The liquid cooling system using
a constant flow of water ensuring that the CPU runs cool under demanding conditions.
2009 and beyond, Acer unveils the first set of Acer Temp Smartphone series, Acer is voted as Readers
Digest gold-medal computer Trusted Brand in Asia for the 11th consecutive year. (Acer, 2010) Acer make
public the new Aspire Timeline series notebooks. (Acer, 2010)

Acer s process innovation comes from the fast food model to increase flow efficiency. The PC maker
needs to survive in this highly competitive environment; Acer placed the component manufacturers in
countries with low labor costs. The finished product units are assembled at or near the market. (Honi,
Tarng, & Chu, 2000) The logistics are then shortening the shipping distances and time require for
transporting the components to the place of assembly. (Honi, Tarng, & Chu, 2000) This is where the fast
food model comes into play.

The fast food model separates the organization into two groups, Strategic Business Units (SBU) and
Regional Business Units (RBU) to facilitate its global logistic operations. (Honi, Tarng, & Chu, 2000) The
SBUS takes care of the component manufacturing in the Philippines, Malaysia, Souchow in mainland
China. The RBU is responsible for the assembly and adjustment for its regional market. (Honi, Tarng, &
Chu, 2000)

The client-server organization to increase information and flow efficiency serves in the process of order
entry, product shipment, tracking, replenishment of warehouse inventory, invoicing, purchasing,
accounts receivable, accounts payable, and various forms of planning. (Honi, Tarng, & Chu, 2000) Most
of the waste of time occurs in delays between the processes usually due to the lack of integration. Acer
uses the client-server business model composed of business units, subsidiaries, and affiliate companies.
All the entities operate independently, are separate according to product line and territories. The parent
company sets basic rules to guide the companies, however the system is flexible to make prompt
decision making based on the conditions of local markets without losing the benefits of a multinational
company. (Honi, Tarng, & Chu, 2000)

In the year 2009 Acer ranked second in the industry with a 13.5% growth, principal competitors are Dell
Inc.; Fujitsu Siemens Computers; Hewlett-Packard; NEC Corporation; net income in 2008 11,742,135.
Acer has become a very successful multinational but Honi, Tarng, & Chu warn that there are new
challenges ahead for Acer.

One of the items that Honi, Tarng, & Chu mention is that with the developing trend of integration of
computer, communication and consumer electronics direct channels such as mail order and internet
transaction, more innovation in global logistics may emerge that may alter the business in the future.
Honi, Tarng, & Chu conclude by saying that Acer s advantage has been (a) assembly innovation; (b)
process innovation; (c) joint venture; (d) sales strategy innovation. It has been this process that Acer has
managed to change the way business is dine and forced stakeholders to change their roles and redefine
the value boundaries. Good logistics, mutual adjustment with partnerships which have allowed for
flexible leverage Acer can deliver the best products. Innovation has been the key to successful market
penetration for Acer. (Honi, Tarng, & Chu, 2000)

Strategic Planning Methodology for Innovation (SWOT Analysis)

Company Strengths:

Acer is a private corporation that has found a niche in providing technical innovation as well as PC
production.

Acer hires matter expert s technical support and production. The reason behind this hiring procedure is
to make sure that staff is in touch current industry standards and use this information for the benefit of
the company.

Acer has a strong, engaged management team that has found a way to merge, assimilate and participate
with other companies to make Acer a success.

Company Weaknesses:

One of Acer s weaknesses is the company s ability to sustain continuous innovation in a market that is
constantly changing.

Second: Acer is a Taiwanese firm. Customers have the perception that products made in Taiwan are
cheaper, lower quality and reliability. This factor according to Honi, Tarng, & Chu will put a lid on sale
prices and may make it difficult for distributor and consumers to maintain brand loyalty to Acer
products.

Third: as a result of the ensuing of a lower margin would hardly be able to motivate distributor to carry
Acer products.
Creditor/Suppliers Domestic

Creditors and suppliers: in order to operate Acer needs large amounts of capital so the corporation has
adopted a global branch/local touch approach. (Honi, Tarng, & Chu, 2000) Branch companies around the
world and headquarter forma a collaborative organization, to prevent domination. Acer allows joint
ventures with large loyal computer distributors which can posse s more than 50% ownership. This single
agreement allows that local Acer (with firms around the world) to be listed as local stock and be free to
seek capital for their own expansion. In other words Acer global creditors are local creditors and global
suppliers are local suppliers linked to Acer.

Costumer Profiles

Acer s primary market is the United States. Therefore thrends on the U.S. are what make up the
customers for Acer. In the U.S. PC s, laptops, handheld devices have become a sort of an appliance.
Large companies must have computer, most families in the U.S. have a computer, students, even senior
citizens what to stay in touch with family via computers and the internet.

Case Systems and Application of the Systems

A Technology-Based Functional Model (technology is the integration mechanism) (Lars & Sundbo, 2005)

System 1:

Robert Anderson in his book Innovation Systems in a Global Context uses the definition of system of
innovation given by the Organization for Economic Cooperation and Development as a network of
institutions in the public and private sectors whose activities and interaction initiate, import, modify and
diffuse new technologies.

Production System

Fast food system: In order to solve the problem of the logistics of production in low wages countries,
links to the delivery of finished product Acer adopted the Fast Food system. In this model Acer
separated its organization into tow groups, Strategic Business Units (SBU) and Regional Business Units
(RBU), to facilitate its global logistic operations. For example the SBU takes care of the components
manufacturing that is based in Taiwan, such as Acer peripherals monitors. Acer has a rule of transporting
components according to three categories. 1st: identified the components that have a long product life
cycle such as a keyboard, monitor. 2nd: products produced by SBU that have a shorter life cycle and
change little, such as main boards and CD-ROM drives; these are shipped by air. 3rd: products that have
a short life cycle and change quickly, such as CPUs and hard disks. These are purchased directly from the
suppliers by the RBU. (Honi, Tarng, & Chu, 2000) This process of innovation is founded on the assembly
innovation technique, where the SBU functions like a central kitchen and the RBU functions like a sales
point. (Honi, Tarng, & Chu, 2000)

System 2:

Global branch/local touch: Acers uses joint-ventures in order to speed production, delivery, financial
funding, and costumer support. In different regions, Acer s RBU forms these joint-ventures with large
local computer distributors. This process is also called minority ownership strategy. (Honi, Tarng, & Chu,
2000)

Challenges to Innovation and Their Solutions – Environmental Analysis (Pearse/Robinson):

1. Remote environment:

Current economic factors are not in favor of any of the IT industry because of the depression . People s
perceptions are that they need to limit their purchases in order to avoid going into debt. Lending factors
could also affect the access to credit for example to support innovation. Salaries, wages and new hires
may become and issue in order to make sure there is enough capital to operate so the equipment
required is a want not a need. Having said that there businesses that grow during a depression. And
example of such industry is education. Colleges, universities, technical schools grow during this period of
time. These companies, private and state would be one of the primary clients for companies such as
Acer.

Technological factors: Technology is ever changing. New equipment, software and hardware for
businesses, as well as individuals are available. Companies involved in businesses that thrive during
economic duress may want to wait for new equipment, software and hardware for students, employees
may have to wait until the company sees that affect of economics on their company affect their bottom
line.

a. On the other hand companies that depend on technological advances such as the medical industry or
the IT businesses would make an effort to provide their employees or students with the most up to date
software and equipment in order to stay competitive. An example of this is Provo College is planning to
invest up to $5,000 dollars per computerized patient dummies that simulate patients in hospital
settings. Getting this equipment ensures that nursing students have critical information about how to
manage patients.

Social/political factors: current political for internal support for American workers which may further
support educational environment. Larger numbers of people who would enter school as adults would
pressure the system to get more equipment for the educational process. New technology forces
companies to adapt; in the medical field Utah has chosen to standardize medical information so all
parties involved can have access to patient records. This decision on the side of the medical
establishment needed new software, and equipment to make sure that they can all cooperate in this
endeavor.

As the baby boomer and baby Jones generation gets closer to retirement many job opportunities will
present challenges for companies that may need computers that have adjustable screen size for an
aging workforce.

2. Industry environment:

The competitive landscape

A. Dell Inc. Similar products: desktops, laptops, servers, printers, projector. , U.S. based company,
locally/globally recognized name.

Competitive prices for similar Acer equipment.

B. Fujitsu Siemens Computers similar products: network equipment, IT support, system integration
Japanese based company, locally/globally recognized name.

C. Hewlett Packard – Similar products: commercial PCs, consumer PCs, workstations, handheld
computers, calculators, software and services, imaging and printing. HP has a retiring and replacing
equipment to assist companies in planning and acquiring technology. U.S. based company, locally/global
recognized name.
Competitive prices for similar Acer equipment.

D. NEC Corporation – similar products: IT service, IT products, network systems, social infrastructure,
personal solutions, electronic devices. Japanese based company, locally/globally recognized name.

What is different?

Competitors

Their advantage Acer s advantage

Single corporations does not have to worry about global stake holders.

Mainly U.S. staff that may not understand all the global trends.

Tuned to local supply and demands from the U.S. market.

Locally financed U.S. stock market.

Plenty of joint ventures and collaboration around the world.

Diversity of staff where ever Acer has collaboration.

Global cooperation that can keep an eye in world trends.

Globally financed anywhere there are Acer partnerships.

Not severely affected by local disaster events. Since Acer has many partnerships they can move
production to less affected areas.
3. Opportunities:

1. Acer has the ability to continue to be a technology leader in the world by continues to stay current
with computer and software trends. Acer has the opportunity to capture clients who have left other
companies after getting lost in the system. Acer s adoption of the minority ownership strategy allows for
local companies to deal directly with clients complains, needs, and requests. Companies organized in
such way are called Cellular Form Organizations. Each team, strategic business unit, form has an
entrepreneurial responsibility to the larger organization. (Honi, Tarng, & Chu, 2000)

2. Acer can surpass their competition by continuing to follow the 3-6-2-1 principle. Acer takes three
months for product design and manufacturing, six months for sales, and one month for clearance of the
inventory. (Honi, Tarng, & Chu, 2000)

Summary External Threats:

1. Heavy IT industry competition by other top IT companies.

2. Acer has managed to solve some of the problems associated with globalization; new challenges
remain to be solved. According to Honi, Tarng, & Chu paid assembly costs have decreased so much that
Acer has very little room for improvement in this area.

3. Honi, Tarng, & Chu advice Acer to watch for the integration of computer, communication, and
consumer electronic trends that will be a new aspect of logistics management for Acer.

Critical Issues:

I believe may have some blind are that they have not planned in their potential for growth. Some of
these blind spots could have a potential cause for frustration on both clients and partners. Another
critical issue is that the baking industry seems to have changed the way they process loans denying
credit to potential partners. For a company that depends on small enterprises to support its local
business this could be a problem since many of the clients and suppliers have are locally based. The lack
of financial acquisition could create serious financial difficulties.
Role of Ethics and Responsibilities

Business ethics are based on principles of integrity and fairness focused on internal stakeholder issues
such as product quality, customer satisfaction, employee wages and benefits, and local community –
environmental responsibilities.

Martin states that innovation incorporates inventiveness of technology that has impacts communities,
individuals, and the planet. In Systems Theory the relationships in a system can trigger a butterfly effect
on other parts of the system, or even throughout the entire system. (Kemp, 2010) In capitalism the
systems theory would seek to create relationships in the system that provide larger profits. The triple
bottom line explains that in order for a corporation to be successful it needs to meet the triple bottom
lines which are: 1) sufficient material goods, 2) sustainable ecological systems, 3) good quality of life,
qualified by individuals as well as community-oriented services. (Warmoth, 2006)

Martin suggests that there are some rules that innovation should follow in order to operate ethically.
Innovations happen in a community that has existing norms and relationships. How will innovation
influence and affect the community? Stakeholders: who will be impacted by the innovations?
Disruption: who is adversely affected by this innovation? Is the company maintaining the rights,
autonomy, and the dignity of the community by not treating them as a means to the goal of innovation?
Responsibility: has to be shared by the corporation and the community.

According to the World Business Council of Sustainable Development (WBCSD, 2003) ethical corporate
social responsibility is a business commitment to contributing to sustainable economic development,
working with employees, their families, the local community, and society at large to improve the quality
of life. Acer has adopted the Three Ones and Three Multiples philosophy. This approach means that Acer
is one company, one brand and one global team and multiple suppliers, multiple product lines, and
multiple channels.

Acer has established relationships with its stakeholders and based on shared efforts/intents, fully
sharing their policies within all the company environments. All corporate partners are required to adopt
any changes to environmental protection standards. They are also required to comply with changes to
the product design. For example recycling, low toxicity emission, and any other policy changes. (WBCSD,
2003)

Effects of Leadership Ethics

According to Bass and Steidlmeier explain that the ethics of leadership have three supports: (1) the
moral character of the leader, (2) the ethical values embedded in the leader s vision, articulation, and
program which followers either embrace or reject, and (3) the morality of the processes of social ethical
choice and action that leaders and followers engage in and collectively pursue.

There are many reasons for choosing the appropriate leadership in an organization. However according
to the Wallace Foundation Project there are two functions that encompass the core of what leadership
is; these two functions are providing direction and exercising influence. (Leithwood, Seashore, Anderson
& Wahlstrom, 2004) In the research that I came across about leadership styles these two items were
prevalent in the discussion of effective leadership. I chose Richard Hall’s supportive leadership style.
(Hall, 1999, p. 141) This type of leader has consideration for subordinates, has consultative decision
making, and does not micromanage but rather delegates work and authority to the subordinates.(Kemp)
This leadership style closely resembles the transformational leadership style in J.W. MacLean and
William Weitzel’s The book Leadership: Magic, Myth, or Method? Mentioned in the 1996 Society for
Human Resources Reader, part of Dr. Kemp electronic lecture series.

According to Lominger there are about 67 core competencies that make a good leader and management
team for any organization. These competencies are closely linked to management styles, leadership
traits and capabilities. In an educational setting the chosen leadership style is closely related to
educational outcomes. The Wallace Foundation in their October 2007 Conference Educational
Leadership a Bridge to School Reform coined the term Cohesive Leadership System. This system
supports leadership standards, training, and progressive educational environment for the betterment of
the school system. (Leithwood, Seashore, Anderson & Wahlstrom, 2004) What are the desired
leadership competencies? What kind of decision making is involved in this type of management style,
and how does this leader manages clients and staff?

As mentioned before Lominger mentions over 67 core competencies for a successful leader. Charisma to
motivate employees, stakeholders and students alike is one of the characteristics that I would like to talk
about first. This charismatic leader is interested in the work and non-work activities of the people they
manage. This manager understands that productivity is linked with subordinate wishes, desires, work
environment, family relations, and productivity. (Lominger, 2008) This leader is compassionate and
thinks of others needs first. This leader is approachable by subordinates and relates well with equals.
(Lominger, 2008)

In the same way the supportive leader inspires a sense of direction because they understand the vision,
mission and long term purpose of the agency. (Kemp)This approach allows the leader to make bold
moves in directing others, managing diverse populations, and taking initiative while challenging the
status quo . (Lominger, 2008)Ongoing changes in direction or purpose are guided by active listening in
the part of the leader. This leader seeks new information, is open to new guidelines and is willing to
experiment and keep discussion channels open for learning. (Lominger, 2008)
Principles and Practices for Implementing Innovation Change Management Plan (Kemp, 2008)

Change management implies considerate planning, sensitive implementation with consultation with all
the people involved by the changes. Change needs to be implemented with realistic, achievable and
measurable items. What does the company wants achieve with this change, why does this change need
to happen, and how is the change going to happen. If the stakeholders are involved is easier to sale the
idea of the change for all the parties involved.

Specific changes needed are:

1. Strengthening the assembly process and the organization activities might be a possible improvement.
(Honi, Tarng, & Chu, 2000)

2. Aspects of logistics management may become an issue in the future because of the emergent trend of
the integration of computer, communication and consumer electronics. (Honi, Tarng, & Chu, 2000)

Inclusion: inclusion of all stakeholders, in particular all global partners responsible to meet corporate
and clients needs.

Managing Change: Since Acer is a global company is the responsibility of Acer s managers to facilitate
and enable change. Change needs to be presented in such as way that employees would like to adopt
the changes rather than forcing people into change.

Success Change: Kotter

1. Increase urgency: corporations need to inspire people to move, make objectives real and relevant.

2. Build the guiding team: the right team can get commitment from employees.

3. Get the vision right: remind employees of the mission/vision of the company.
4. Communicate buy-in: Involve as many people as possible.

5. Create short-term wins: achievable goals. Finish current stages before starting new ones.

6. Empower action: remove obstacles to progress, enable constructive feedback, support to employees
from leaders; reward and recognize progress and achievement.

7. Don t let up: encourage persistence.

8. Make change stick: reinforce the value of successful change.

According to Bean implementation can be one of the hardest things to do. CIO Magazine in their article
Innovation How to Implement New Ideas explains how Proctor & Gamble organize the innovation flow.
P & G use the SIMPL Simplified Initiative Management and Product Launch. This process is broken into
six phrases: discovery, the search for opportunities and ideas; design, where concepts turn into
prototypes; qualify, where ideas are validated; ready, preparing for the launch; launch, and leverage.
Others like Standor Hospital & Clinics add a risk analysis prior to launch.

Mills manages innovation in five synchronized ways: setting goals and targets; creating and satisfying
management expectations; balancing effort against results; coordinating effort in the other streams;
delivering a satisfactory return on investment from the whole program. By establishing innovation
capabilities a corporation needs to establish specific roles and responsibilities in regards to innovation.
The company needs to facilitate employees and teams to innovate autonomously, creatively, through
training, mentoring and coaching. Employees must be encouraged to actively participate and be
rewarded for their participation in the program. (Mills, 2000)

Austin on the other hand believes that there are five essential steps to implement change. Identifying
stake holders: stakeholders can be identified based on their power to help or hinder change. Align
arguments to build momentum: if the company can build a sense of connection and ownership among
stakeholders they can be the supporters of the change. Create and Engagement Strategy: once
stakeholders are connected to the plan the change leader can propose deadlines, and order of actions.
Identify Trigger Events: these events can be competitor s actions, changes in regulations, changes in
support from stakeholders, or any other shift in the original plan. Plan to Be Wrong: since innovation
change or implementation are new to a corporation there should be build in the idea that something
can go wrong and prepare to deal with unexpected issues that may arise in the process of
implementation. (Austin, 2009)
Austin also recommends taking into account how employees may behave towards the change.
Employees are also stakeholders and sometimes they may oppose the changes. How is the company
going to sale the idea to the employees? Austin says that companies need to give employees time for
process the reaction and assist them in the process.

Application of innovative Processes and Theories to individual Organizations (Glor, 2003)

In the 2003 meeting for Innovation in Governance and Public Administrations in Bahia Brazil Glor
discusses three aspects to implementation innovation: first is the desire to innovate and the finances to
support innovation; second is effective implementation and consequences, and third the context of
innovation and which innovations are chosen. (Glor, 2003)

The will to innovate; Glor explains that businesses, governments, etc. avoid solving problems. They
ignore the problems or provide inadequate resources when they do act. Glor s first suggestion is to
create the will to act to correct issues though innovation. There are many reasons why individuals,
governments, and corporations do not adopt innovation. Among those reasons Glor inform us of the
power of institutions, fear of change, and the most important reason is people. People who acting as
themselves or in behalf of a company, or an institution do not want to change and influence innovation.
The will to innovate comes from two reasons, innovation that arises as a reaction of a crises and needs.
(Glor, 2003) Innovation can be also created as a response to create a market for new items to sale,
(proactively). (Glor, 2003)

Even thought Glor speaks of effective implementation of innovation in the public sector one can gather
that it can be applied to the private sector. Management is a key to administering the speed in which
innovation is adopted, implementing innovation appropriately, keeping communication open and
effective. Management also plays a key role in providing training, and methods of evaluation to
demonstrate success.