Beijing Gas Group Development Strategy

With the acceleration and intensification of globalization and the market maturity in China, Beijing Gas Group Co. Ltd is faced with fierce competitive pressures brought about by the entry into WTO, environmental protection required by the Olympic Games in 2008, and the issues concerning reengineering to make the Gas Group grow faster. The objective of this paper is to advise the huge state-owned energy enterprise to adapt to the market-oriented concepts and mentality, to adjust its existing strategy and to enhance its core competencies.In the beginning, the author firstly reviews the evolution of strategy-related theories, demonstrates the importance of strategic management in the context of the corporate setting. Secondly, the author reviews and analyzes the process, current situation, and the general existing problems and issues of the strategic management of the enterprises in China, so as to add much pertinence to this study.Based on the background information on the part of the existing strategy adopted by the Beijing Gas Group, this paper conducts a detailed analysis of strategic issues of this group company by using such analytical tools as SWOT Matrix, Boston Matrix and Portor's Five Forces Model. The author discusses the status in quo of global gas market and domestic market, the internal environment of the group company, and the structure of gas industry. The major strategic problems of the group company are summarized on the basis of above-analysis, including the obsolete thoughts of decision makers, the weak management system of human resources, the deviation on building corporate culture, and the teetering on information processing. Focusing on these problems, the author points out the necessity and importance to adjust the strategy currently in use by the group company and puts forward the following recommendations:firstly, break the traditional single-business structure, and engage in diversification; secondly, broaden the managerial people's vision and mentality and adopt marketing-oriented operations; thirdly strengthen the human resources management; and fourthly set up new system for technological innovation; fifthly build a corporate culture characteristic of "blue flame spirit"; and finally establish management information system so as to raise the overall competitiveness.