The case of Li&Fung

Understand the case of Li&Fung by answering the following questions. It can be at any length (i.e. 3-5 pages) as long as the questions are perfectly asked.

1. Discuss the change management issues confronting Li & Fung (“LF”) i.e. how Li&Fung has dealt with the changes in the market and in the world, how did the company overcome every obstacle and comment on their reactions.

2.The 2017-2019 three-year plan is quite a significant departure from its history of growth through acquisition. Should LF continue with its past acquisition strategy? What is LF’s core strength? Integrating and extracting value from acquirees, or growing organically, which is the focus of the 2017-2019 three- year plan? Would organic growth be able to sustain LF’s past growth?

3.Will LF succeed with its 2017-2019 three-year plan? ls it too late to play catch-up to Amazon and Alibaba?

4.Critique the following paragraph from Dr Marco Tieman, the founder and CEO of LBB International (a logistics consulting and research firm that specializes in agri- food supply chains, industrial logistics and third-party logistics):

“Technology is also transforming the field of supply chain management The reality is that we are entering an era of transformation from fixed assets (factories and warehouses are owned)to virtual assets(hired when needed),from fixed labor (staff on own payroll) to virtual labor (outsourced, app builders);and from fixed inventory(stored at physical location)to virtual inventory(available in the network).Supply chain management has advanced beyond organizing supply network towards orchestrating entire brand channels.

Source: New Straits Times (Malaysia) July 8, 2015 “Branding the channel in today’s virtual world.

5.What factors may derail LF’s future?
6.Discuss Spencer’s standing as the CEO of LF.

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Answer preview

Achieving long-term business success is challenging for most local and global firms. However, some firms like Li & Fung (LF) have achieved long-term success for over a century of doing business in the supply chain. Over time, many changes have occurred in the industry requiring a high level of adaptability from LF. The firm has also faced many obstacles, which it has overcome by developing workable goals and visions which have propelled growth. One of the significant changes is the shift in technology, innovation, and the internet that has led to the emergence of strong competitors in online businesses such as Amazon and Alibaba. Several factors have affected LF’s market position and competitiveness, necessitating a long-term vision to continue growing amid rapid market changes.