This thesis presented an empirical study exploring the performance of TFT-LCD industry through vertical integration in value chain. Statistical analysis methods were adopted to examine the performance of TFT-LCD industry. The following theories of the profit pool and DuPont financial analysis approach, supplemented by competitive strategies, vertical integration, value chain and profit pool theory literature, from the industry overview and key aspects of the value chain Profit distribution and changes in the degree of value chain integration impact on the profitability of panel makers. In this research, we focused on the different segment of the TFT-LCD value chain (color filters, polarizers, backlight module, driver IC and panel manufacturing). We used three financial performance indices of these companies between 2005 and 2009,namely ROE (Return on Equity; ROE), return on total assets (Return on Asset; ROA), operating margin (Return on Sales; ROS) such as most scholars commonly used financial indicators as measurement tools observe all aspects of the value chain profit changes. Finally from the perspective of profit pool and vertical integration strategies to examine whether TFT-LCD panel manufacturers could use an integration strategy as a way to improve their performance on operating profit margin and lower the risk. The results are as follows: the value of different levels of vertical integration, panel makers will do the performance of the operating profit margin have different effects, with the active dwell Taiwan¡¦s TFT-LCD industry up the value chain integration, is indeed closer to or exceed the Korea TFT-LCD maker, but with the TV panel sales with a gradual increase in the proportion of the panel sales , sales channel became a key factor in whether or not profitable. Therefore, the panel makers may be able to consider more closer cooperation with the player of home appliance industry and downstream continuing down the value chain to make the direction of integration efforts.

Abstract In 2004 the market shares of Taiwan taken the place of Japan and became the 2nd in the world, only next to Korea.In the near future, we can forecast that TFT-LCD will succeed the semi-conductor industry to stand for the star industry of Taiwan. Since the supplychain of TFT-LCD are very long, complicate and most of the key components controlled by big supplier from Japan and USA. In market,From 2004 Q3, the new 6th and 7th TFT-LCD generation production line in Korea, Japan and Taiwan will start to trial run. At the same time, the LCD-TV market expands slowly by the high price. With all these unclear condition raise the worry about the future of this industry. It is difficult to forecast the feature condition. Taiwan¡¦s company face more competitive and uncertain condition. The conclusions of this study are presented as follows: This study simulates possible condition by poters Industrial scenario in the feature. According these possible condition this study also provide a process of develop competitive strategy for Taiwanese corporations. This research offer suggestions for Taiwanese corporations: 1) proceed to vertical integration in key components and mergers to achieve competitive scale. 2) cooperate or form alliance with Japanese corporations 3) make use of Co-opetition strategy to change the element of competition between Taiwan¡BJapan¡Bchina and Korea. 4) Taiwan companys should create competitive advantages by using the vertical allied with supplier and the strongest advantage of cluster effectiveness. 5) shift manufacturing to China to achieve cost advantage.6) It is good time develping own¡¦s brand. Then Taiwanese corporations will establish competitive advantages in this industry.

Due to the progress of display manufacturing technology, TFT-LCD (Thin Film Transistor-Liquid Crystal Display) has been widely put in use gradually such as monitor¡Blaptop and LCD TV. We also can find TFT-LCD that has already entered the market of the consuming products from IT (Information Technology). And the competition of the panel industry, besides manufacturing technologies, the dynamic demands of upstream, downstream and consumers are related that will effect the performance of panel markers or whole supply chain. Which is called bullwhip effect. Especially, the configuration is vertical partition in Taiwan and the buffwhip effect would be more significant than other countries. This paper discusses the key factors of bullwhip effect and them constructs the system dynamic models to explore the difference. Finally, we will analyze the TFT-LCD members of Taiwan to figure out the decision rules to decrease bullwhip effect.

The main purpose of this research is to discuss the risk of TFT-LCD industry, and to prove that the future of this industry is not positive as expectation. Through discussing the TFT-LCD firms¡¦ operating, investing, and financing activities and observing the cash flows of their parent companies, the research tries to find the potential risk of this industry. The following conclusions were obtained. 1. From ¡§the variability of stock prices¡¨ and ¡§beta¡¨ of domestic TFT-LCD firms, we cannot find out if the operating risk of TFT-LCD industry rises or not. 2. The gap between cash flows from investing activities and cash flows from operating activities is getting larger. On the one hand, TFT-LCD firms have to keep on investing to compete with others, which makes their cash outflows grow up rapidly. On the other hand, Korean TFT-LCD firms and international system enterprises try hard to cut down panel prices, which makes domestic TFT-LCD firms can only earn low profit and even get loss. 3. Nowadays people put emphasis on the growth opportunity of LCD TV and expect the demand of LCD TV will bring TFT-LCD firms high profits. However, the research finds that the investment and production of LCD TV lack efficiency, which implies even if the demand of LCD TV spring up in the future, it won¡¦t necessarily benefit domestic TFT-LCD firms. 4. Observing the trend of Economic Value Added(EVA) of domestic TFT-LCD firms, we can see that EVA is getting lower during each valley of Crystal Cycle, which reflects the over production is getting worse in this industry and large investment accelerates the loss of TFT-LCD firms. 5. The difficulties of financing activities of domestic TFT-LCD firms include: (1) acceleration of Crystal Cycle, (2) shortage of cash flows limits the financing ability, (3) information asymmetry lowers the willingness of investors to invest, (4) banks starting to tighten the loans to TFT-LCD firms due to risk consideration. 6. The parent companies of TFT-LCD firms invest in TFT-LCD industry in order to cut down the cost and keep earning profits, however, the huge cash outflows raise the risk of the parent companies instead. It indirectly proves the high investment risk of TFT-LCD industry.

Nowadays, the trend of maximizing the liquid crystal display panels makes the display firms and the upper suppliers hold the passive and disadvantaged position in Taiwan TFT-LCD industry, and cannot but push them follow Korea¡¦s strategies to set up new plants and promote the yield continuously. However, setting up a new plant indeed costs a lot, thus, how to reduce the total cost of the supply chain becomes an urgent key point in TFT-LCD industry. Therefore, the co-operative relationship between the upper key component firms and the middle panel firms, the complementary and complete extend of the materials, equipment and the key components can be highly home-manufactured or not, becomes the most important subjects. For this reason, how to help Taiwan¡¦s TFT-LCD industry acquire the active and predominant position is worth studying. The major TFT-LCD suppliers of technology and equipment in Taiwan still have to depend on Japan. Thus, this research intends to focuses on the large-size TFT-LCD firms and analyzes the present situation with the following three dimensions: 1. Can Taiwanese firms gain the active and dominant position with continuously building up plants and complete localized supply chain in TFT-LCD industry? 2. Discuss the level of completeness between the TFT-LCD panel firms and the upper key components firms with equipment and materials to survey that TFT-LCD industry is self-contained or not in Taiwan. 3. How to speed up the whole supply chain of TFT-LCD industry and makes it come into being. Eventually, this research results in three findings of TFT-LCD industry: 1.Crystal cycles happen repeatedly, and it not only fluctuates obviously but shorten the circular interval as well. 2. The technologies of TFT-LCD alternate rapidly. 3. The supply chain of Taiwanese TFT-LCD industry is not self-contained enough. In addition, the integrated and localized ability is over-slack. In conclusion, I take one foreign and one domestic industry-upgraded cases for examples, and try to figure out the constructive and positive guiding principle for the TFT-LCD industry and the following studies in the future. Key words: TFT-LCD, key components, supply chain.

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First of all, we put an emphasis on the global market status of TFT-LCD, which is also our government¡¦s most important economic investment in the near future. We think it is necessary for Taiwan cooperating with Japan to reach the global No.1 place in TFT-LCD industry since Japan initiates and masters many related technologies. A-Company; however, gets such right chance for multinational combination by taking good use of some key factors¡Xorganization integration, communication and human resources management. Because TFT-LCD products get short-lasting life and fast-advancing technology, A-Company must be greatly expanding its investment annually. Although the company has independent technologies, it still has to rapidly enhance its competitiveness on global purchase, global distribution and global service through making cooperation with other technical corporations. Thus, how to take advantage of both companies¡¦ interior resources to create even more high values is meaningful to A-Company. This research shows that organization integration, personal factors, organization promises and individual defense will affect merger achievements. We design a questionnaire and use SPSS for quantification analysis to strengthen the reliability and validity of our research. Lastly, we bring out the final results and conclusions for A-Company reference. According to the questionnaire we find out that, A-Company employees think the high-level managers play quite an important role in the organization integration; their communication and expression on human resource management will directly affect merger achievements. Nevertheless, the company seems not participate in the consolidating planning before combination and not elaborate on the communication after that which leads it into negative effects after combination. From this, we deeply realize that ¡§Manpower¡¨ is the most emphasized resource for consolidating business. Our conclusion is that many failure factors of overseas or domestic combination business are also applied to TFT-LCD Company, and therefore, we think that the success factors during its merger can be imitated by other industries as well. Anyhow, it¡¦s a real pity for A-Company¡¦s not taking good application to academic researches and some successful measures from other business. In sum, there are not only multinational cooperation but also multicultural races merging in the special TFT-LCD industry which reveals a fact that the affiliation of academia will speed up this industry¡¦s growth.

The original of industrial cluster analysis is to distinguish what is cluster. It is developing to overview industrial district and to conclude the potential industry. In the light of these defects, we cloud improve them for industrial development. This industrial cluster analysis of variables by literatures, including of Industrial Concentration Factor, Cluster Dependency Factor, Economic Prosperity Factor, and four strategic resources that influence development of cluster, including of High Quality Human Resource, Technology and Knowledge Resource, Infrastructure, Capital. Using the questionnaire and interview with members in the cluster. The results of research: (1)There is a orientation of TFT-LCD industrial cluster in the Southern Science Park and show a vertical industrial cluster than horizontal cluster. (2)Material and Key part of equipment is complete and available, but there is only one application firm that produces large TFT-LCD. (3) TFT-LCD industry is important in the district and creating economic development. (4)It is difficult to find many talents about TFT-LCD industry and High Quality Human Resource is positive effect to this cluster.(5)As a result of TFT-LCD industry is at initial stage, they have less demand of Technology and Knowledge Resource, but it is increasing in the future.(6)The films are satisfied of water and electricity system, but they think that the staff cloud not get better quality of life in the district.(7) As a result of using capital without borders and Taiwan¡¦s government take TFT-LCD industry seriously, the films get capital smoothly. Key words¡GSouthern Science Park ¡BThin-Film Transistor Liquid-Crystal Display ,TFT-LCD¡BIndustrial Cluster¡BLocation Quotient.

In industrial competition¡A business cost is reduced by the strategies such as the enhancement of production efficiency¡A the reformation of operational procedure¡A and the expansion of economic scale to have the enterprise enhance its competitiveness in encountering the competitive external environmental changes for securing a favorable status in business operation. The framing and implementing of successful strategies depend on the wisdom and daring of the business operator in leading the enterprise. Hence¡A the business operator or the high-level executives¡¦ leadership in the organization as well as the perception and daring in business planning play a critical role in determining the success or failure of an enterprise. The focus of this study is on exploring how the TFT-LCD high-level executives in the high-tech industry under high-tech¡A capital-intensive¡A and competitive TFT-LCD environment use their keen perceptions and management concept in leading the organization to break through the dilemma by plant establishment¡A plant expansion¡A and investment expansion¡A and have a dominating status in the TFT-LCD industry. The research interests are as the followings¡G 1.To understand the differences of the management concepts among the high-level executives of various enterprises in the environment with intensive-capital risks. 2.To understand the ways of the TFT-LCD industry in Taiwan for breaking through the plight under international competition. 3.To compare the management notions of the high-level executives in TFT-LCD industry with those of the world celebrated enterprise leaders. After reading the related literatures¡A on the basis of the three forgoing subjects and the spirit of qualitative research¡A case study is conducted as the theoretical foundation¡A and three high-level executives in the TFT-LCD industry are interviewed¡A with the information analysis of the interview result¡A this research is expected to have the following contributions¡G 1.Presenting and comparing the management concepts and differences of the high-level executives in the TFT-LCD industry of Taiwan. 2.Generalizing the ways of the high-level executives in the TFT-LCD industry of Taiwan in breaking through the barriers under international competition. 3.Comparing the management notions of the high-level executives in TFT-LCD industry with those of the world celebrated enterprise leaders. Accordingly¡A the presentation of the management concepts of the high-level executives in the TFT-LCD industry of Taiwan and the ways of breaking through the plight could be taken by the future high-level executives of the intensive-capital hi-tech industry as the reference for management.

Micheal Porter ¡§the country competitive advantage which¡¨ publishes in 1990 (The Competitive Advantage of Nations) in a book, proposed the industrial cluster the strong character which acts in the national competitive power, ¡§scientific and technical park¡¨ the idea is also the industrial cluster concept derivation to a certain extent. In the past concentrated in the industrial cluster's research in the metropolis plan study and the regional economies domain, few had the management science stratification plane discussion, after 1990 Micheal Porter publication diamond model (Diamond Structure model), grew the industrial cluster's research to further management stratification plane in and so on enterprise's strategy, competition, market demand and industrial structure subjects. However, Porter in the diamond model, had not mentioned how to compare and appraise between the different cluster the cluster effect height, is also lacks a set to be possible the quantification model. In order to solve in the Porter diamond model to lack the quantification model the question, this research application analogism, quotes Newton (1687) the law of universal gravitation which proposed in "Natural philosophy's Mathematics Principle" to take the analogy, develops the cluster relative effect the comparison model, explained why during different essential factor in an industrial settlement's will have the cohesion phenomenon, will form the cluster effect finally. In this study, Central and Southern Taiwan Science Park's TFT-LCD industry as the research object, evaluation of these two science parks in the TFT-LCD industry cluster effect on the merits, to verify the model's feasibility in real life. In the final results, will be the evaluation of the scores of small movements do multiply, the two parks, the Southern Taiwan Science Park to obtain higher scores, it can be said that the Southern Taiwan Science Park, TFT-LCD industry cluster effect higher. By Porter in the diamond model's five big essential factor classification, in ¡§factor of conditions¡¨ and ¡§related and supporting industry¡¨ in these two essential factors, the Southern Taiwan Science Park was in the upper hand; In ¡§demand condition¡¨ and ¡§firm strategy, structure and rivalry¡¨ on, is the Central Taiwan Science Park holds the superiority; As for in last item ¡§government and opportunity¡¨ in the comparison, two campuses are equally matched. Finally, also at the Central Taiwan Science Park and Southern Taiwan Science Park development on the current problems faced by comment, I hope the next government as a policy planning in the industrial park on the proposal, which is newly developed in this study "cluster can be quantified effect model "where the ultimate goal.