News Room

Shanghai, China - Nov 10th, 2006 – An American consulting firm [Sedulo Group] helps a Chinese manufacturer reinvent itself . Baoshan Electronics, a consumer electronics component manufacturer based in Shanghai, China, recently closed a handful of lucrative contracts that guarantee the company’s future and signify its successful transformation.

Just 15 months ago Baoshan Electronics, a privately owned Chinese manufacturing company, was trying to figure out how it would survive in a market that had grown increasingly competitive. The company had watched helplessly as its eroding market share seemed to signify the end to the company’s ten year history.

a final effort to get the company back on track, the executive leadership decided to bring in an American consulting firm that specialized in competitive strategy. “We thought that maybe if we understood our competition better, we could strengthen our position in the market”, says Li Wu, President and CEO of Baoshan Electronics.

Baoshan Electronics had erupted on to the consumer electronics scene in the late 90s with its innovative component designs and industry leading reliability. At the heart of its success was the company’s reputation for producing quality components built on its state-of-the-art Printed Circuit Boards. Over the last several years a number of newer manufactures, backed by large OEMs, had moved into the space, gobbling up Baoshan’s market share and forcing the company to consider drastic measures.

“We are very excited about the level of expertise that Perspicacité de Stratégie brings to Sedulo; not only their unparalleled expertise in foresight strategy, but their industry research capabilities and broad European reach.” stated Story.

For help, Baoshan turned to Sedulo Group, a small New York City based Competitive Intelligence firm. “When Baoshan first brought us in they explained that they wanted us to conduct a competitive intelligence study; it did not take us long to realize that they needed much more than that” says John Story, Managing Director of Sedulo.

“Tunnel vision can kill a company” says Story. “It is often difficult for companies to see their universe for what it really is. They have this view of their competitors, their customers, suppliers, vendors and the market… and often this view is just not in sync with reality.”

Baoshan Electronics’ market share had dwindled to single digit figures, accounting for a drop in revenue of 80% over just three years. “At one point we were a market leader, just a few years later we were fighting for our survival” says Li.

After an extensive twenty-week study, in which Sedulo Group examined everything from Baoshan’s competitors and costumers to its market and management philosophy, the American consulting firm believed they had the solution. “Baoshan had a great reputation for producing quality components, that quality; everyone seemed to agree, stemmed from their highly reliable Printed Circuit Boards”, says Story. “Baoshan was spending millions of dollars trying to compete and they were still loosing. Once we were able to help them develop what we call a ‘strategic awareness’, things began to come into focus.

Ultimately Sedulo Group worked with Baoshan to develop a drastically new strategy; one that they believed would save the struggling manufacture. The overall premise of the new strategy was to abandon the component segment and focus the company’s manufacturing efforts exclusively on Printed Circuit Boards.

Almost overnight Baoshan transformed its business model from component manufacturer to Tier 2 supplier. In just a few short months the company had singed a number of multi-million dollar supplier contracts. Included among Baoshan’s new customers are three of the company’s former competitors.

“When it comes down to it, there are dozens of factors that impact a business, and most of those variables are outside of its control That means that understanding your environment, having a strategic awareness, is critical for a company’s success,” says Story.

“We are fortunate that we were able to shift our model so quickly,” says Li. “Being nimble in today’s world is very important. Had we not been nimble, we could not have listened to the Sedulp team, and we likely would not be in business today.”