Research On Dynamic Capabilities Of Jiangxi's Postal Express

On July 20, 2006, the Standing Committee of the State Council discussed and approved in principal the Reform Bill of Postal Service System, which marked the prologue of the new reform of postal management system in China. It is quite clear for the Chinese EMS that, under the new postal management system, first, the postal express service will finally be viewed as competitive business in the sphere of postal service, with its pattern and market circumstances differing significantly from general services; second, the postal express service will eventually wend its way to complete marketization, and turn to be the subject of market that operates independently and takes responsibility for its own profits and losses. As for the market circumstances, it will be deprived completely of the present executive privileges, and will be placed in a position of fair competition against non-governmental or foreign-funded express services ; third, as the competition intensifies increasingly, the market circumstances for the postal EMS will get more complicated and uncertain.The postal EMS is by far the biggest operating agency and leader in Chinese express business, and the earliest provider of such service as well. As the structural reforms of our postal management deepened and the promise of opening the express market after the entry into WTO fulfilled, however, the Chinese express business is being threatened by non-governmental and foreign-funded express firms, and its market share is being occupied rapidly.The postal EMS in Jiangxi province, as an important part of China's postal express service, is also facing fierce competition and the issue of how to sustain its advantage in competition. Since dynamic capabilities are what make the competition advantage sustainable, the postal EMS in Jiangxi should enhance its dynamic capabilities to sustain and reinforce its advantage. Focusing on the dynamic capabilities of Jiangxi's postal EMS, this paper discusses the industrial features, development history and existing problems of the postal EMS. It employs the theory of dynamic capabilities to establish a so-called "three-dimension" analytical framework, and further form an evaluation system for the dynamic capabilities of postal EMS. After a positive analysis of the dynamic capabilities of Jiangxi's postal service, the paper also provides countermeasures for its improvement. To be specific, this paper contains three parts.The first part (Chapter 1) serves as necessary preparations for the subsequent study by depicting the industrial features, development history and existing problems of the postal EMS. I argue that, in contrast to the traditionally general postal service, the express service is characterized by a weak economy scale caused by the increasing cost of network development, features of logistics transportation and network construction, which in turn lowers the entry barrier of this industry and alters the fields that are supposed to be supervised. In China, express corporations under various ownership develop in different ways: international express corporations generally follow the path of "agent service-joint venture-sole proprietorship" after entering the mainland Chinese market, while the non-governmental ones usually follow that of "routine operation-stationing networking-network perfecting", for they have progressed at pace with the rapid development of Chinese economy, especially non-governmental economy. Now Chinese express business is growing very fast. Service it provides is increasingly getting better, and multi-polarized frame of fund has taken shape. But the market share of the postal EMS, the earliest service provider in China, has reduced under the attack from both international and non-governmental express service.The second part (Chapters3, 4, 5) is the core of this paper. In these chapters, what comes first is a review of the formation and development of the dynamic capability theory. Then, beginning with the shift of dynamic capabilities from being abstract to being specific, and also taking the industrial features of the postal EMS into consideration, this paper manages to establish a "three-dimension" analytical framework and evaluation system for the dynamic capabilities of postal EMS. Thus the study then offers a positive analysis of the dynamic capabilities of Jiangxi's postal service.Firstly, a review will be given to the theory and analytical framework of dynamic capabilities, which are the power that makes an enterprise's core-competitiveness sustainable. This part focuses on the origin and effect of advantages in competition, analyzing systematically the background, formation, evolvement of the dynamic capability theory, and its analytical framework as well. 1. Probe into how the theory advanced and evolved, so as to get a clear knowledge of the developmental phases of the theory and the deficiency in each phase; 2. Describe how the theory produced and developed, learning about the main contents and viewpoints; 3. Expatiate the analytical framework of the dynamic capability theory in terms of position, process, and path.Secondly, establish dynamic capability theory and analytical framework for the postal EMS. Based on the foregoing review of the theory and its analytical framework, and also the industry attributes and techno-economy features of express industry, this part establishes an analytical framework for the postal EMS. By doing this, I am employing and promoting the theory. In addition, it serves as the theoretical basis for the analysis of dynamic capabilities of Jiangxi's postal EMS. 1. Show the connotation of dynamic capabilities of the postal EMS on the basis of the typical definitions given by the present academic circle; 2. Form a theoretically "three-dimension" analytical framework for dynamic capabilities of the postal EMS for the better application of it; 3. Produce a basic evaluation system for dynamic capabilities of the postal EMS according to the theoretical framework of it.Thirdly, analyze the dynamic capabilities of Jiangxi's postal EMS.1. Based on both the basic constitutive elements and sources of dynamic capabilities, with the combination of the industry features of the express business, the paper analyzes the dynamic capabilities of Jiangxi's postal EMS in terms of early warning of environment, policy-making and strategy transformation. And then the index of dynamic capabilities of Jiangxi's postal EMS will be calculated; 2. Analyze the data in the first part and search into the decisive deep courses that influence the dynamic capabilities of Jiangxi's postal EMS, in hope of discovering ways of enhancing the dynamic capabilities of Jiangxi's postal EMS. In this part, the paper makes an important turn from qualitative analysis to quantitative analysis, from theoretical interpretation to practical practice, and from problem analysis to problem solving. The analysis shows that, the overall evaluation of the dynamic capabilities of Jiangxi's postal EMS is just fair, which indicates they needs further improvement. Judged by the single index, there is greater deficiency in the early warning of Jiangxi's postal EMS. It is the area to which special attention should be paid. And the establishment of corresponding strategic administrative agencies to perfect organizations makes a significant breakthrough. The transformation capability of the Jiangxi's express service scores the highest, still there is weakness—the capability of capital utilization. It is the center of the future concerns.The third part (Chapter6) puts forwards some countermeasures, since the ultimate purpose of the study is to enhance the dynamic capabilities of Jiangxi's postal EMS. As an extended study, this part will direct the ways of enhancing the dynamic capabilities of Jiangxi's postal EMS on the basis of the foregoing studies and conclusions.In the first place, strengthen and perfect relative organizations. The Chinese postal EMS is operated vertically, with those inferior express firms as the subsidiary units of those superior, which causes the express firms on the level of city or county to neglect the business environment and strategy formulation. This is going against the improvement of the dynamic capabilities of the postal EMS. On the other hand, since economic development, competition in the express industry and constructions of postal nets vary in different parts of China, the old pattern, that all the local express firms must implement the national strategies, is certainly unfavorable to the development of the postal express business itself. Therefore, specific organizations should be founded in such cities as Nanchang, Jiujiang and Ganzhou, in order to formulate their own strategies.Second, establish and optimize the network of drumming-up and delivery, which is the core of the express service, and is not only of great significance to the speed and security of express delivery, but also the manifestation of its advantages in competition. So, to establish and optimize the network of drumming-up and delivery of the postal EMS is essential for the enhancement of dynamic capabilities of Jiangxi's postal EMS. The measures contain: make a full use of the present postal nets; put forward the construction of drumming-up and delivery network of the postal EMS by developing logistic distribution of the postal EMS; support more effectively; standardize the express service.Third, strengthen the advantages in competition by means of reforming business model. In order to reinforce its competitive power to keep and even increase its market share in the express intra-city delivery, the postal EMS must reform its business model and its mechanism. Its major aims are: make the hierarchical management change into a flat one; transform service philosophy from passive service to positive flexible service, so as to meet the market demands better and serve customers in more personalized ways, which can in turn enhance its capabilities in competition and market.Fourth, strengthen brand management of Chinese postal service. Brand strategies have been proved to be the most powerful method for modern enterprises to reinforce their core-competitiveness and general strength. The competitive power of products and enterprises is manifested in that of brand. Therefore Jiangxi's postal EMS should improve the brand management and upgrade brand core-competitiveness. Only by doing this can the business be indefectible in the competition.Finally, intensify the cultural construction of Jiangxi's postal express service, which is now in the midst of a business environment that is changing very fast. To exalt its capability of responding to the changing environment is the premise for the sustaining of the present competitive advantages. Apparently, responding properly to environment rests on the emergence of innovative spirits within an enterprise and the real innovation of conventions, thus innovation should be the central value of the enterprise culture of Jiangxi's postal EMS.Surrounding the subject "the dynamic capabilities of Jiangxi's postal EMS", this study brings forward three basic ideas:1. It is determined by the cost increase, the features of logistic distribution and transportation, and network constitution, that the express service is characterized by a weak economy scale, which in turn lowers the entry barrier of this industry and alters the fields that are supposed to be supervised;2. The essence of the theory of primitive dynamic capability that consists of position, process and path is the response of enterprise core-competitiveness to the changing environment and the joint of competition advantages and core-competitiveness. Therefore it is possible to change dynamic capabilities into capabilities of early warning, policy making and transformation;3. Restricted by the pattern of vertically integral management and old postal administrative system, Jiangxi's postal EMS is relatively weak in the early warning of environment. It is an important aspect if Jiangxi postal EMS plans to its dynamic capabilities.Here are the features and contributions of this study:1. New research field. The express service is a rising industry, so it hasn't drawn much attention. My paper analyses extensively the industrial features, market environment, the present conditions and problems of the express industry, followed by a systematic study of Jiangxi's postal EMS with dynamic capabilities as the focus. Based on these efforts, the paper directs the way for Jiangxi's postal EMS to enhance its dynamic capabilities. This research field is new in a way.2. Creative theory. The theory of dynamic capabilities is now the academic frontier of the theory of the enterprise strategic management. Research on it is still in its infancy, among which the measure of dynamic capabilities deserves discussing. After a thorough understanding of what dynamic capabilities really mean, my paper establishes an evaluation system for the dynamic capabilities of the postal service in the light of the early warning of environment, policy-making and strategy transformation, combined with the knowledge of the express industrial features. It is theoretically innovative.3. New viewpoints. I have made my own points in the paper about the industrial features, analytical framework for the dynamic capability theory of the postal express industry and how to uplift the dynamic capabilities of Jiangxi's postal EMS. In contrast to the previous researches, these viewpoints are somehow new. As a systematic study of the dynamic capabilities of Jiangxi's express business, this paper is of great theoretical and practical significance for the enhancement of the dynamic capabilities of Jiangxi's postal express in the new period:1. Theoretical significance. The theory of dynamic capabilities is not only the frontier of enterprise strategic management theory, but also the further development of the core-competitiveness theory. Research on dynamic capabilities is in its initial stage. There is much controversy over the definition of its connotation, and there is no reliable evaluation system, either. This paper introduces the theory of dynamic capabilities into the strategic management of the express industry and establishes an evaluation system for the dynamic capabilities of the express business, after a full discussion of the characteristics of the express industry. It provides a solid theoretical basis for the express business to enhance its dynamic capabilities.2. Practical significance. The postal express is the main part of the Chinese competitive postal business. How to improve the competitive power of the postal express business is not only what Jiangxi's postal system needs urgently to solve, but also the central duty facing the Chinese postal industry. Concerned with the dynamic capabilities of Jiangxi's postal EMS, this paper means a lot to its enhancement and further keep the core- competitiveness sustainable.