Strategic Planning

Large Chinese State-Owned Enterprises: Corporatization and by Yong Zhang (auth.)

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By Yong Zhang (auth.)

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According to Gao and Chi (1997: 21), the following sectors have been identified as key sectors with strategic importance that the state will remain in a controlling position. First are public utilities, such as communications and transportation, water and electricity supply. Second are basic goods industries, including exploration of natural resources, iron and steel, non-ferrous metals, and so on. Third are pillar industries such as machinery, automotive, electronics, petrochemicals, 42 Large Chinese State-Owned Enterprises and construction.

Major corporate strategy pursued output growth and size expansion in order to meet market demand. Major strategic initiative in order to produce high value-added products, focused on core competences. Very ambitious but impractical corporate strategy. Focused on size expansion via unrelated diversification. Revised corporate strategy in the light of lessons learned from the 'big company strategy'. Focus on size expansion and related diversification. Major corporate strategy to absorb foreign technology, in order to achieve output expansion to meet the massive market demand.

Productivity had stagnated or even declined. Furthermore, in the countryside, 900 million farmers were liVing in extreme poverty, far below the living standards of the 100 million urban dwellers (Dodds, 1996: 70S). Reform, Corporatization and Strategy Theories 31 When Chairman Mao passed away in 1976, Deng Xiaoping, the chief designer of China's reform program, came into power as the second generation of state leader. With the strong advocation of Mr. Deng, China announced a program to reshape its economy in late 1978, although many reform measures began on a small scale and on an experimental basis.

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