Air Materiel Group, The Industry Value Chain Restructuring And Business Strategy Research

Aviation Supplies Group Corporation (ASG) is a comprehensive service provider for aviation industry with key businesses in the import and export of civil aviation products. As a window company of China, ASG used to play an important role in the course of foreign affairs and foreign trade through volume sourcing. With change of market environment and reform of civil aviation industry ASG is facing a series of difficulties due to downturn in business. The paper aims to discuss the value chain turnaround and business strategy selection with reference to the development road of the renowned companies by value chain reengineering and strategy management.Firstly, the paper summarizes the condition and trend of civil aviation market of China. While industry centralization, competition environment updating, and fresh business model become popular, the major players in this market are busy with expanding their service range along the value chain of aviation industry. Secondly, the paper explains the specific parts of value chain of civil aviation industry, which are divided into four parts, namely, aviation manufacturing, aviation products trade, aviation transportation, and aviation support. Such conglomerates as Boeing, GE, and Airbus are gaining a firm foothold in the industry by expanding business range and broadening the scope of their influence.Thirdly, the paper studies COFCO and SINOCHEM as the bench-marking companies. The two famous state-owned enterprises present us a snap-shot of strategy positioning and business portfolio planning, which are a classical case of application of strategy & value chain related theories.Fourthly, the paper starts an analysis of ASG's value chain turnaround and business strategy selection. After a study of civil aviation market partition and internal competence the selection of business portfolio is then decided. The strategy positioning is integrated with internal competence and core competence build-up. Moreover, the paper puts forward a series of assumption of business strategy on aviation products distribution as well as the affiliated supporting businesses.