撮要

Dun’an Holding Group is a major Chinese conglomerate, employing more than 19,000 people in 90 companies. Its main business is in the heavily regulated civil explosives industry. Chinese government policies encourage both mergers between the various chemical companies producing explosives and companies along the industry value chain. By 2012, Dun’an had grown to a leading industry player through a series of mergers and acquisitions including a successful reverse merger with Anhui Jiangnan Chemical Industry Co. Ltd.

In the near future, the company wanted to build market share in West China, improve safety management and product mix, and strengthen the co-ordination of research, production, marketing and explosive service provision. The company also wanted to develop and strengthen strategic partnerships with large companies in the fields of mining and infrastructure development to create new profit growth through business model innovations. Top management had to decide how to make tradeoffs on decision making when taking into account geographical location, vertical integration, and product portfolio.

學習目標

The case can be used to teach how to evaluate the different dimensions of a company’s strategic management, how to achieve significant tradeoffs when making decisions and how to evaluate the impacts of different decisions on the company’s overall positioning in the market.

On a conceptual level, students will gain an appreciation of the real-world dynamics when making strategic decisions. Strategic issues usually require the allocation of large amounts of company resources and have significant long-term impact on the company’s future business development.

In this case, the focus placed on the analytical dimension when making strategic decisions. What issues was the company facing in terms of its geographic scope, vertical scope and product scope respectively? Which dimension should the company focus on first? How might the company’s management of its scope in the three dimensions affect its overall positioning in the civil explosive industry?

To summarize, the following key concepts and theories can be applied in this case study:

Identification of strategic issues
The importance of strategic issues
The different dimensions of strategic issues
Strategic decision-making
Evaluation of different options
Prioritizing different business options and making tradeoffs