Law of the LCD industry to survive

BOE into liquid crystal display industry for almost ten years, we have experienced a brutal baptism of the industry cycle, step by step grow up. However, we are well aware, the BOE from the "Show the world leader in the field of" vision, there is still a long way to go. In recent years, we have been exploring: how to nurture and AO3403 datasheet and build their own core competencies, get rid of liquid crystal display industry, "roller-coaster cycle" impact of a "value creation driven" model of development, achieve long-term stability of earnings.

Survival Law

Years of research and AO3403 price and exploration, we found that a law of liquid crystal display industry: every three years, liquid crystal display panel prices will drop 50%, to survive, product performance and AO3403 suppliers and efficient technology ownership is necessary to improve more than doubled.

We call this the "law of survival of liquid crystal display industry."

This law need to explain a few concepts are as follows -

Product performance is the sum of product features and quality. The future performance of liquid crystal display products will be more towards the image is beautiful, thinner, more energy efficient, more environmentally friendly, more convenient and more humane direction of progress. Product performance index can be used to measure product performance. Product cost performance index is the degree of innovation and value innovation measurement tool for a certain time point represents the marginal revenue product for the basis.

Ownership is effective technology support for product performance, cost reduction and performance enhancement technology production line ownership, in a nutshell is the support of product competitiveness and earnings power of technology production line capacity. Production line efficiency refers to the production rhythm, production of flexible degree, yield guarantee level, operation stability.

Checkmark curve

1991 LCD panel TFT-LCD industry in Japan has been achieved, liquid crystal display industry has gone through nearly 20 years of history,

Especially in the past decade, the industry context clearly reflect this law.

figure downward trend in profitability of a product map

Figure I shows the price of LCD panels for nearly nine years, material costs and marginal benefits decline and relationships. One panel prices fell faster than the faster rate of decline in material costs, diminishing marginal returns showed a trend.

Figure II product performance / cost of power / performance and marginal revenue product line diagram

Figure III technology ownership and product performance / cost of power / performance production line graph

Figure II, Figure III shows the performance / cost force / production line performance and marginal revenue, and effective technology ownership and product performance / cost of power / performance production line between the proportional relationship.

Figure IV price, the marginal relationship between income and technology ownership map

Figure IV shows the price lines have been down in the case, to maintain the same margins for effective technology ownership and innovation capabilities.

When we add together the four pictures, you will find, the price decline curve and technology-driven value creation resembles the formation of a "√" in the graphics, we will call it "law of the survival curve" (shown in Figure Five shown).

law of the survival curve of Figure V

This curve reveals the value creation driven technology to enhance corporate value for the role and impact of the enterprise rules of survival to achieve stable profitability: As liquid crystal display downward trend in prices is inevitable, companies must continue to drive value creation through technology to enhance product performance, cost, power and performance of production lines to ensure stable profit enterprises to achieve a virtuous cycle of sustainable development.

Innovation

We propose that law, only one purpose: the internal unity of thinking, and implementing strategies to accelerate innovation, and the formation of "value creation driven" development mechanism. Rapid advances in technology, changing market environment, the only continuing to accelerate innovation, enterprises can survive.

BOE always attached importance to innovation, our innovative system is divided into three areas, each other premise, interactive promotion.

Technology and product innovation: product innovation, the goal is to lead the market in response to market evolution, rapid and continuous introduction of performance, quality, low-cost new products. And technological innovation for product innovation and production lines to provide fast and effective performance improvement to support the technology. Technology and product innovation is the core part of business innovation.

Business process innovation: BOE in recent years in promoting the enterprise information on the remarkable results. As companies expanded and increasingly rich product line, business process optimization requires synchronization, and promote value creation performance of IT systems to maximize and achieve all aspects of business and do a thorough and extreme detail.

Management of innovation: people-oriented, developing human potential, to fully mobilize the enthusiasm, initiative and creativity, goal-oriented objectives of the unity of man and dynamic self-management mechanism.

Must also be noted that in the liquid crystal display industry, moderation is the key element of the scale. A certain size in order to establish a competitive supply chain system, with a certain scale have the ability to digest huge development costs, with a certain size in order to form extensive product line and adequate technology holdings. The formation of appropriate scale, rely on technology, management, personnel and capital backing, quick to seize the opportunity to rely on the layout of the development model of courage and innovation.

"Law of survival of liquid crystal display industry," is the summary of our practice is 20 years of colleagues to explore the wisdom. This "survival law" and can predict the future pervasive industry-wide, but we continue to be common practice.