Essay About Regional Business Unit And Application Of The Emerging Microprocessor Technology

Acer : The Rampaging Dragon
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With a sense of real excitement, Stan Shih, CEO of
Acer, Inc., boarded a plane for San Francisco in
early February 1995. The founder of the Taiwanese
personal computer (PC) company was on his way to
see the Aspire, a new home PC being developed by
Acer America Corporation (AAC) Acer’s North
American subsidiary. Although Shih had heard that
a young American team was working on a truly innovative
product, featuring a unique design, voice
recognition, ease-of-use, and cutting-edge multimedia
capabilities, he knew little of the project until
Ronald Chwang, President of AAC, had invited
him to the upcoming product presentation. From
Chwang’s description, Shih thought that Aspire
could have the potential to become a blockbuster
product worldwide. But he was equally excited that
this was the first Acer product conceived, designed,
and championed by a sales-and-marketing-oriented
regional business unit (RBU) rather than one of
Acer’s production-and-engineering-focused strategic
business units (SBUs) in Taiwan.
Somewhere in mid-flight, however, Shih’s characteristic
enthusiasm was tempered by his equally
well-known pragmatism. Recently, AAC had been
one of the company’s more problematic overseas
units, and had been losing money for five years.Was
this the group on whom he should pin his hopes for
Acer’s next important growth initiative? Could such
a radical new product succeed in the highly competitive
American PC market?And if so, did this unit—
one of the company’s sales-and-marketing-oriented
RBUs—have the resources and capabilities to lead
the development of this important new product, and,
perhaps, even its global rollout?
Birth of the Company
Originally known as Multitech, the company was
founded in Taiwan in 1976 by Shih, his wife, and
three friends. From the beginning, Shih served as
CEO and Chairman, his wife as company accountant.
With $25,000 of capital and 11 employees,
Multitech’s grand mission was “to promote the
application of the emerging microprocessor technology.”
It grew by grasping every opportunity
available—providing engineering and product design
advice to local companies, importing electronic
components, offering technological training
courses, and publishing trade journals. “We will
sell anything except our wives,” joked Shih. Little
did the founders realize that they were laying the
foundations for one of Taiwan’s great entrepreneurial
success stories. (See Exhibit 1.)
Laying the Foundations Because Multitech was
capital constrained, the new CEO instituted