Complete manufacturing system Ensuring leadership in total cost
Another major point in Michael Porter’s theory on competitive strategies is that concerning leadership in cost. Users’ perception is drawn only to prices, not costs, but leadership in total cost implies an enterprise’s ability to control its cost. Indeed it is one of the basic means for the enterprise to create value for users. Kaishan’s Seattle North America Development Center ensures that the company possesses world-leading research capabilities and deliverables. Naturally, the company should also establish a comprehensive and highly-capable manufacturing system to convert such research deliverables into first-class products.
Having its products manufactured in China has enabled Kaishan to achieve perfect conversion of its research deliverables into products at significant cost advantage. Kaishan operates four manufacturing bases in Quzhou, Shanghai, Chongqing and Shunde in China and 85% of Kaishan’s products are manufactured in-house. The company’s scientific and effective management has enabled its complete manufacturing system to attain a rare competitive advantage in manufacturing, thereby consolidating its significant cost advantage.
To do a good job, one must first sharpen his tools. Only with top-notch manufacturing equipment would one be able to convert world-leading research deliverables into first-class products.
The manufacture of screw unit is the core process in the manufacture of screw compressors. In fact, nearly 70% of Kaishan’s fixed assets are concentrated in this process. With more than 40 Mitsui machining centers in our company, we are the largest customer of Japan’s Mitsui Seiki in China. In addition we are equipped with 6 KAPP screw grinding machine at a cost of over RMB 20 million each, 6 Holroyd screw grinder, 4 Holroyd screw milling machine, 7 Hexagon triple-coordinate measuring instrument and a large amount of high-precision machine tools. All of them are ample indication of our company’s strength, and are important assurance of our company’s ability to consistently maintain first-class standards.
Create “absolute competitive advantage” with First-class Core Technology
One would possess no core competitiveness without possessing core technology – this is the greatest insight attained by Kaishan during its 60 years of history and more than 40 years of experience in air compressor manufacturing. As such, Kaishan devotes, annually, significant amount of research and development funds for technological innovation, talent procurement and cultivation. The company has come a long way from “not possessing core technology to possessing first-class core technology”. Today this concept is deeply ingrained in the company’s top management.
In 2009 the company established a North America Development Center in Seattle in the U.S. It followed the establishment of its sales network which spanned the U.S., Australia, Russia, Southeast Asia and Brazil, and heralded the company’s internationalization effort. The company’s aim was to create an brand-new model involving “developed in the U.S. and made in China”.
The establishment of the North America Development Center did not merely enable Kaishan to obtain the latest industry movements at the first opportunity, but also offered a window for Kaishan to put one of the most important – if not the most important – businesses in the United States, a country that is reputed to have the most powerful innovative abilities and the greatest concentration of technical talents. It also enabled Kaishan to integrate top experts throughout the world and hence enhanced its research capability, thereby ensuring that Kaishan maintains world-leading technological level and research deliverables. At the same time, the internationalization of sales and research also meant increasing significance in Kaishan’s strategy of globalization.
Kaishan’s North America Development Center is staffed with a batch of world-class experts in compressors, including world-renowned screw compressor expert Dr. Tang Yan, top centrifugal compressor expert Dr. Brasz and axial-flow compressor expert Mr. Biederman.
Research & development team
He was formerly technical director of Bizer’s Beijing company. He is a renowned expert in refrigeration and air-conditioner systems as well as a member of the “Recruitment program of global experts”. Dr. Tang Yan’s compressor technology perfectly complements the system integration technology of Dr. Fan Zengzhi, which enables Kaishan to obtain enormous technological advantages in the refrigeration industry.
He is the person-in-charge of air centrifugal compressor project and also a long-term technical person-in-charge in foreign compressor companies.
He has been devoted to design of air compressor systems for more than 20 years, and developed full series of diesel-powered air compressor products.
Under Dr. Tang’s careful grooming, Mr. Hui has rapidly developed impeccable skills and experience in compressors. He is currently responsibrtle for screw air compressors, screw gas compressors and gas expander projects.
He is an experienced designer of gas compressor system and also the technical person-in-charge of Kaishan’s gas compressor business department
“Absolute leadership” from comparative competitive advantages
What is the difference between 99 degrees and 100 degrees? On the surface the difference is only one degree, but in reality it is the difference between warm water and boiling water. Apply this principle to an enterprise and it is the difference between being good or outstanding. Through extraordinary focus and investments over a prolonged period of time in research and development, Kaishan does not simply possess an excellent technical power and it is able to launch a series of highly efficient and reliable products with low-noise, whose performance indicators all greatly exceed those of other similar-class products made both locally and internationally. Possession of absolute advantages in technology and products has enabled Kaishan to attain “differentiation competitive advantage” so emphatically espoused in Michael Porter’s theory on competitive strategies.
Today, Kaishan is the only company in the world that is capable of achieving Class One energy-efficiency for its full range of screw air compressors. Moreover, it is Asia’s largest and the world’s third-largest manufacturer of screw compressor. In addition, Kaishan has the capacity to recover low-grade energy and thus achieve high-efficient and gradient use of energy. Kaishan Compressor Co., Ltd has come a long way of being an outright manufacturer of compressors and is today a global leading enterprise capable of producing new energy power stations and supplying energy-efficient products and solutions.