History and Background of Splendor Group:
The Splendor Group was started back in 1996. It’s “Sunny Market” was the first big supermarket owned by Chinese people in Guangdong province. Splendor’s supermarket grew fast, two years later, its spread all over the south of Mainland China, and its branches could also be seen in some large cities in northern China now.
Ownership Structure:
Splendor Group is a listed company; most of its stocks are controlled by the Guang Zhou Government. Besides, there are some other shareholders in Splendor.
SASAC (State-owned Assets Supervision and Administration Commission ) of Guang Zhou takes 40% of the whole stocks.Shen Zhen Airline Group takes 15% of the whole stocks.
Mr. Yu, Mr. Chen, and Mr. Luo are three main individual investors of Splendor, they takes 5%, 3%, and 3% of the stocks respectively.
Moreover, 34% of the stocks are hold by the shareholders in the open stock market.
Supermarket:
In 1996, Splendor Group started its business in supermarket industry in Through 17 years’ development; it becomes the fourth biggest chain supermarket in Mainland China. （After Walmart, Carrefour and China Resources Vanguard）. In South, it could rank no. 2. Following the rapid development of economy, Splendor has accessed to Hong Kong market in 2008. Now it owned 2 branches in Shatin and Tsuen Wan. However, the supermarket industry is quite competitive in Hong Kong. So the record of performance of Splendor's supermarket is not very well. In the past year, Sunny Matket faced a big loss of profit in HK; In order to get rid of the business distress in HK, Splendor Group intends to do a series of marketing activities to stimulate consumption. The top layer of Splendor Group (HK) is quite confident that ranks to no. 5 group in Hong Kong within 5 years based on its solid strength.Background of the Community Chest:
The Community Chest of Hong Kong is a corporation established under ordinance in 1968. It is an independent, non-profit making organization neither funded nor operated by the Government. The Community Chest is governed by a Board of business and community leaders who contribute their time voluntarily.
The logo of community chest is a pagoda, it adhered the holy spirits that protected its people. Later on, the multi-leveled pagoda symbolized the accumulation of wealth and blessings. The Community Chest applied this symbol as its logo to appeal for public support. By building a pagoda out of many grains of sand, every member of the community can be involved to bring forth hope for the needy.
The chart illustrates The Community Chest allocate the donation to each kind of needy group, including family& child welfare services, children& youth services, medical & health services, elderly services and so on.From this chart, we can see that the diverse range of business in Community Chest. However, in recent years, many nature and human-made disasters happened in the world, such as Indian Ocean Tsunami, the earthquakes in China and Japan, terrorist attacks etc. The community Chest always plays a positive role in helping the people suffering the disasters all over the world. Therefore, it needs to collect more donations to support its charity activities.
For the more information about The Community Chest, pls click http://www.commchest.org/en/home/index.aspx
The Collaborative Project:
For the needs of development, Splendor Group and Community Chest decide to build a website named www.Virtualspcc.com to illustrate the collaboration project.
Goals of Splendor Group:
There are four goals of Splendor. Firstly, we regard this cooperation project as a kind of ads to branding. Secondly, Splendor Group wants to show its CSR to the public and build up a good company image. Thirdly, we want to use the online collaboration to improve our capability to keep up with the fast development of Internet. It can give us the chance to open online shopping platform in the near future. Finally, according to the Virtual project, it can help Splendor manage inventory through "Charity Dollars" plan. These goals can be explained by the three vectors and three stages and the theory can lead the way of ours.
The Three Vectors and Three Stages:
As we pointed out before, our company has to achieve some goals by carrying out this collaboration activity with the Community Chest. Achieving organizational goals is very important for us to do the collaboration. To make you better understanding our collaboration activity, we want to introduce the strategies of our virtual organization with the concepts provided by N. Venkatraman and John C. Henderson in the Real Strategies for Virtual Organizing, 1998.
Every organization should have its own strategy and structure, but as for the virtual organizations, structures like functional, divisional, or matrix may not be the key issue of the structure, because in virtual organizations, this kind of structures are not as effective as those in the traditional organizations. Instead, the virtualness may be an important strategic characteristic applicable to all the virtual organizations. After we use virtualness as a strategy, we can reflect the interdependent vectors of the organization. According to the Real Strategies for Virtual Organizing, each vector of its model has three distinct stages, stage one focuses on the task units. Stage two focuses at the organizational level on how to coordinate activities to create superior economic value. And stage three focuses on the interorganizational network to design and leverage multiple interdependent communities for innovation and growth.
Vectors and Stages:
We can use the concept to analyze the virtual organization www.Virtualspcc.com, we have introduced our virtual organization before. Our actions have to match the vectors and stages provided above. The vectors are independently, they focus on different functions, so we can use all of them to explain the strategy of our organization.
Firstly, we want to use Customer Interaction (Virtual Encounter) to explain the strategy of our virtual organization. The interactions of a company with its customers (and consumers) in the industrial age occurred through a multistage distribution network involving wholesalers, retailers, customer service agents, and franchisees. The predominant focus was on efficiently distributing products in a linear fashion from manufacturers to consumers. The emerging global, digital economy allows for establishing and leveraging a two-way information link between a company and its customers — albeit through remote and asynchronous mechanisms. This link is possible not only for consumer products and services hut also for business-to-business products and services.
The third stage of this vector is customer communities, the communities focus on information gathering and information disseminating conduits. It means the communities can offer customers opportunities to share their information and thoughts by virtual ways. We all know that it is difficult for a product or service provider to get information from people in different places. It is also difficult for people to share their ideas with others far away from them. The development of internet gives us the chance to communicate with people in different regions. We want to create an online platform for all the potential customers and the existed customers to share their views to the charity activities, views to our product even interesting experiences of themselves. Our goal is not only set up an online shopping platform but also a social network. Our customers can use our website to share their experiences and knowledge with others. As we pointed out before, we also have some online activities such as photograph competition, short video competition. We use these online activities to attract customers to show their ideas to others, and we use the activities to enhance the connection among our users. Also, this platform is not only open to those who had donated in the Community Chest, but also to all the internet users all over the world. It can build connections among people in different parts of the world, and these activities can publicize the charity activities held by Community Chest, it can also publicize our company to the world. We can use this customer community to build a good image of the Splendor Group.
After describing the stage and the way we use it, it is clear that we use this online platform or the virtual organization to improve our operating efficiency, enhance economic value added and sustain innovation and growth. It is part of the strategy of the virtual organization.
We also want to use Asset Configuration (Virtual Sourcing) to explain the strategy of the collaboration. This vector focuses on acquiring critical assets and resources, a clear move away from vertical integration toward greater reliance on components obtained from external markets. It is very important for a virtual organization to be closely linked with its suppliers as to create a shared destiny. This vector suggests that a virtual organization has to build a good connection with its suppliers. A virtual organization also has to select which assets are good to improve the working efficiency of the organization.
The third stage of the vector is resource coalitions. It focuses on the establishment of a resource network. Every organization is either implicitly or explicitly positioned in a network of resources where it acquires complementary capabilities. Our organization also has to do resource coalitions to improve the competitive advantages of the Splendor Group. Our company mainly focuses on the offline customers, but due to the development of internet and the changes of customer behavior, the offline supermarket is not enough for us to get more profit. Our resources are mainly about offline marketing industry, we have to participate in the resource coalitions to make the resources can be used for the online platform, we will set up our business both online and offline, it requires many kinds of resources, so the collaboration platform is a good chance for us to reconsider our competitive advantages to catch the pace of fast growing virtual market.
The third vector is Knowledge Leverage (Virtual Expertise). It focuses on the possibilities and mechanisms for leveraging expertise at many levels. For this vector, we only want to choose the first and second stage, work-unit expertise. As we pointed before, our company does not have much experience in running an online platform. We do not have many experts who can help us to design and run the online shopping center in the future. So we want to use this collaboration to train some employees to become expertise ones. We can get the help and coach from the other party, Community Chest, they have lots of experiences operating online platform for donation and advertisement. This learning period can help our company improve the operating efficiency. After we have the experts, the online platform can be operated effectively.
The second stage is corporate asset. It focuses on harnessing the collective expertise across work units, rather than within units. Our company can use the opportunity of setting up the online platform to see the potential capabilities of our employees in different assets both online and offline. We will make experts in different fields to collaborate in the future. This can help our company to add economic value after setting up the new online system. As for the third stage, this collaboration cannot help us to get professional community expertise. We have to finish this stage in the future.
Contents of the collaboration:
This website includes five main contents:
1. Introducing the Splendor Group and Community Chest and showing their core value and culture to the public. Besides, the purpose of this cooperation is bring more concern and love to the vulnerable groups and encouraging people to throw themselves to the charity. Also, there is a Donation channel of CC in the website. That means people can donate their money through online payment. It is a safety way for donation and all the online business will be supervised by professional audit institutions. What's more the latest news about the cooperation between the two institutions will be shown on the websites. Finally, in order to let people know more about Splendor Group and Community Chest, the links of their homepages can be seen on www.Virtualspcc.com.
2. Splendor Group and Community Chest will bring out a new concept named "Charity Dollars" to the public. Meanwhile, the web will explain what is "Charity Dollars" and teach customers how to use the "charity dollars". It is a long-term project and also the most important part of the collaboration. "Charity Dollars" is a credit exchange plan. It means that only if the people donates RMB/HKD to Community Chest through www.Virtualspcc.com, they will obtain corresponding credits. The exchange rate of RMB/HKD to "Charity Dollars" is 10 : 1. Besides, the customers can use these charity dollars purchasing in the web shop of Sunny Market. And the goods are purchased by charity dollars can enjoy the service of free express (HK area only). It will illustrate a relevant charts for the more details of the charity dollars on the website.
3. As the sponsor of the charity activity, Splendor Group will donate $1 HKD to Community Chest when customers consuming every $100 HKD. All the donations of Splendor Group can be seen on the website, and we welcome the supervision of the public. At the meantime, the web will create a special sector to show the contributions of the donators. Every people can find your contributions through our search engine.
4. It will hold different of charity activities occasionally. The recent activities is a video competition. Anyone can take part in the competition as long as you have a ID account on our website. Participants can take a short video story about broadcasting love and hope, and upload to Virtualspcc.com from 1st May 2013 to 30th June 2013. And the participants can reserve all ownerships rights to video submitted. The award-winning works will be voted by all network users and the winners will get elegant gifts and bonus offered by Splendor Groups. Meanwhile, the good video works can be shown on the web and we intend to invite some medias to promote our activity. What's more, the network users who have voted for the competition can take part in a lottery, there are many prizes are waiting for you.
5. On Virtualsspc.com, we have the customer service department to answer the doubts of customers and help them solve the problems of donation or online shopping. Besides, we think the web can be a virtual community for exchange people's opinions and feelings. The people can talk with others freely on our web, even they can form friendship with the others. So I will build up a platform for the communication between different network users on www.Virtualspcc.com.
Analyze the project from the knowledge management aspect:
The cooperation between Splendor and Community Chest is a program in the virtual community. So we have to care more about the knowledge management when we building up the Virtualspcc.com. Knowledge Management (KM) comprises a range of strategies and practices used in an organization to identify, create, represent, distribute, and enable adoption of insights and experiences (University of North Carolina, 2013). We need to build up a the Knowledge Management System (KMS) according to our mutual goals and strategies.
KM is often premised on formal KMS that structure, categorise and archive knowledge in central repositories. In order to manage knowledge, employees need to codify the knowledge they have created in these KMS. For Virtualspcc.com, it is necessary to build up a database storing different kinds of information, include literal data, pictures, and videos. The information in this database will contain all aspects of our cooperation. Thus net users can find anything they want to know about our virtual program in the web, like latest activities, donation records, the use of the donation, company news, contact ways, etc. Meanwhile, we will organize a group of technical employees to manage and maintain the operation of the database. We want to make sure that knowledge can be organized for later harvesting by anyone else who has access to the KMS. All netizens in the world can visit the web and search the information without register.
For our company, the goal to build up the KMS is sharing knowledge with other people. So we have taken some measures to enhance knowledge sharing. The Virtualspcc will have three langue versions, which are simplified Chinese, traditional Chinese, and English. If the web become very famous, we will consider to add others langues in the future to meet the demands of others from different countries. In order to make people browse information more convenient, our company intend to create a Search Engine (SE) in the website. Anyone inputs the key words in SE, the outcomes will be displayed quickly. At the same time, we will invite AREP which is a well-known design group to help us make Virtualspcc.com more attractive. Besides, our web will offer the function of social network service (SNS) to the netizens as well. This is a platform for visitors exchanging their mind and experience about charity and the business of Splendor. We intend to use this SNS as a way to do the word-of-mouth marketing. For most of the users, it is also a good platform for making friends all over the world.
Finally, the trust issue of the Knowledge Management cannot be neglected. In class, we know that, too much data and information, sometimes, can make the visitors confused about what are useful for them. So the operation group of Virtualspcc.com have to keep updating the data in regular and put the latest information of our activities and products on the web. What's more, the false information can mislead the visitors. Once found, the corporation image of both sides would be damaged badly. Just like the example of the Red Cross Society of China (RCSC), it cheated its donators and diverted the donation to make its own profit for a long time. Now, most of the people in Mainland China and HK don't wants donate their money to RCSC anymore and call this institution as Black Cross. So the trust of people is very significant for Virtualspcc.com. We will improve the transparency of our cooperation and announce our financial statement to clarify how much fund we have received and how we have used them. Meanwhile, we welcome the external audit from the public, include the Government, Accounting firm, and the public. Besides, our web will also protect the privacy of the visitors. Our donation system is offered by ICBC, which is one of the Top 10 banks in the world. So it will protect your fund security and privacy information.
Analyze the project from the creativity aspect:
The project built in www.Virtualspcc.com by Splendor Group and The Community Chest is a creative project.
Most of the donate activity just appeal individuals to donate money or products to the people who needs. The activity lacks of the interaction between the donator and sponsor. Nevertheless, this project cover more benefit to the donator, not only could broaden the brand (Splendor Group) to the public, but also could enable leverage the benefits to the customers. Supermarket is one of the most popular places that citizens go. We usually buy something from the supermarket. It covers the needs from all the rank, from the rich people to the poverty-stricken family, from the elderly citizen to youngsters. It is a good interaction between the donator, including donator’s family and the Splendor Group. Moreover, The Community Chest usually collaborates with the local enterprise. Collaborating with the mainland group is a good diversity. It could catch more attentions from both Mainland China and Hong Kong sides. This project also more focus on the interaction between the sponsors，donators and public. “Vote for charity” is a good example of the interaction. Participants can take a short video about encouraging other to donate and upload to Virtualspcc.com
All network users can donate a sum and vote for the winner and get the Charity Dollars. Virtualspcc.com can serve as a platform for either video competition's participants or network users to check their Charity Dollar status. Virtualspcc.com provides a hyperlink to both the Community Chest and Splendor Group. It is a good platform to enable the four parties (sponsors, participants, donators and voters) to interact with each other. Participants could express their perspective from their video and upload it in the Virtualspcc.com. Voters also could choice their favorite videos. The sponsors also will give some rewards to the four parties. It is a win-win interaction. Both of them will benefit from it.
The project also abides by the knowledge brokering cycle:
The first step is capturing good ideas; knowledge brokers scavenge constantly for promising ideas, sometimes in the unlikeliest places (Andrew Hargadon and Robert I. Sutton, 2000). They see old ideas as their primary raw material. In this project, the donation theme and supermarket industry are the old ideas. Nevertheless, combining them into a whole virtual project is a good innovation. We see the old stuff as the primary raw material.
Secondly, keep ideas alive. To remain useful, ideas must be passed around and toyed with. Effective brokers also keep ideas alive by spreading information on who knows what within organization (Andrew Hargadon and Robert I. Sutton, 2000). Since the two sides have the thought to corporate with each other. The two sides utilize the knowledge management. Allocating the experts to the corporative project, spreading information about who knows what is a powerful way to keep ideas alive.
Thirdly, imagine new uses for old ideas. This is where the innovations arise, where old ideas that have been captured and remembered are plugged into new contexts (Andrew Hargadon and Robert I. Sutton, 2000). Old ideas can become powerful solutions to new problems if brokers are skilled at seeing such analogies. For instance, the www.Virtualspcc.com will make the flow of donation to the public as the former ways of donation lack of transparency and it brings a lot of dispute from the public. www.Virtualspcc.com will absorb this kind of lessons. Moreover, The Community Chest also has more than 40 years’ experience in the charity industry. It could utilize the experience and old ideas that plugs into the new contexts.
Lastly, put promising concepts to the test. Testing shows whether an innovation has commercial potential, it also teaches brokers valuable lessons, even when an idea is a complete flop (Andrew Hargadon and Robert I. Sutton, 2000). Splendor Group wants to build this corporation because it wants to broaden its brand image, enhance its CSR and spur into Hong Kong market. This project seems like an advertisement for Splendor Group. Hence, it definitely has commercial potential.
All in all, we suppose we could get a big success through this project. Both of the parties could benefit from it. We also suppose Mr Splendor could reach its goals and The Community Chest could get more donations. If there is an opportunity in the future, both of us are willing to corporate with each other.
References:
[1] Building Innovation Factory, Andrew Hargadon and Robert I. Sutton, Harvard Business Review, May-June 2000.
[2] N. Venkatraman and John C. Henderson, Sloan Management Review，1998.
[3] Stephen Denning, Telling Tales, May 2004. P122-128.
[4] G. Hamel and C.K. Prahalad, Competing for the Future, Boston: Harvard Business School Press, 1994
[5] University of Washington. A Note on Virtual Communities, March 13, 1999.
[6] Price, Deborah Evans,10/23/2010,COMMUNITY CHEST. Vol. 122 Issue 42
[7] Barrett, William P.,12/10/2007, Your Charity Dollars at Work .Vol. 180 Issue 12
[8] N. Negroponte, Being Digital, New York: Alfred A. Knopf, 1995
