When Taiwanese electronics maker BenQ took over the mobile phone business of Germany's Siemens AG last year, the Asian firm saw it as a coming out party, a chance to introduce its name to the world.
The merger made BenQ the sixth-largest handset maker in the world and the largest in Greater China, overnight.
Beyond that instant growth, though, the purchase is part of its broader response to the dilemma facing manufacturers around the world: With the rise of mainland China and other low-cost locations, what does the company need to do to prosper?
For BenQ, one of Taiwan's largest electronics firms, that meant beefing up its design capabilities to make more creative products, and trying to make its brand recognizable to consumers around the world - in effect setting the lofty goal of becoming a Taiwanese version of Sony or Samsung.
Plastics News recently spent time with some of the senior product designers in the company's Taipei headquarters and, in a wide-ranging interview, touched on everything from the company's brand-building efforts to what it wants from its plastics supply chain for its phones, laptops and liquid crystal display monitors.
The firm has had accolades. Since it separated from Taiwanese computer maker Acer Corp. in 2001, it has picked up more than 130 design awards, including a prestigious 2006 iF International Forum Design Gold Award, and its product design team was featured on the cover of BusinessWeek's issue last year spotlighting Taiwan.
But it remains a company known more in corporate circles than among consumers, at least outside of its Asian base. Which is where the acquisition of Siemens' troubled handset business fits in - BenQ can use the better-known Siemens name to co-brand its phones for five years.
BenQ calculated it would have taken 10 years for it to develop a worldwide brand name on its own, said Peter Lin, senior manager of the firm's Lifestyle Design Center.
``By working with Siemens, we will get there in a much shorter time,'' he said. ``It's a good opportunity to become an internationally well-known brand. It works. A lot of countries that never heard of BenQ before are familiar with the BenQ brand.''
Financially speaking, though, the merger has proved tricky.
Senior executives have warned that operational problems sorting out the merger will depress earnings this year. Analysts note other challenges, such as whether the company has the heft to compete with giants like Nokia and Motorola in the tough world of phone manufacturing.
``We rate BenQ high risk in view of the extensive losses from the Siemens mergers and integration risks,'' wrote CitiGroup Hong Kong analyst Kent Chan in a May 25 report, although he said performance has improved recently and it could do better if it sells more of its own brand of phones and controls its expenses.
As well, he wrote that the firm's evolving business model has potential conflicts between its BenQ-branded business, which it wants to grow to 50 percent of sales from 37 percent in 2004, and the work it does making products for others.
But Lin downplayed the financial difficulties and said the company was prepared for some short-term pain for the long-term gains it sees.
BenQ made a very calculated choice to try to make a breakout in the mobile phone market.
Unlike its other products, which tend to be used in homes, offices and other private spaces, a mobile phone is used everywhere and is much more visible, said J.C. Pan, a manager in the firm's Lifestyle Design Center.
``It's the best carrier for a brand,'' he said. ``If you have a good cell phone on the market, people see it.''
The company's design efforts are relatively new. It started the in-house design center only four years ago, and it's since grown to 120 designers, with design studios in Taiwan, Munich, Germany, and mainland China.
Its rapid rise in design circles has attracted attention, said Ralph Wiegmann, managing director of iF International Forum Design, a Hanover, Germany-based consultancy.
``Because they are so new, it is really surprising the awareness they have in the market,'' Wiegmann said. ``We all are in a certain way surprised by how fast they are moving.''
Still, he said the company will be challenged by larger, richer competitors. Samsung has about 800 designers, by comparison, Wiegmann said.
Lin said the company considers design important to its development, including giving the design team a symbolically important spot on the 13th floor of BenQ's downtown Taipei headquarters, one floor below (and in the department closest to) the executive suite.
Some of the company's designs are eye-catching and playful.
It developed a stylish monitor that folds up like a purse with handles, and which was featured on the catwalk in a show on fashion and technology by clothes designer Roberto Cavalli.
Another monitor features USB and other connections on cables that swoop around to the front to be easily accessible, like futuristic, e-enabled tentacles.
Other designs are naturally more cost-conscious or practical.
BenQ blended design elements from MP3s and mobile phones to make combination devices that look like something new. And it has developed monitors with light sensors and built-in timers to turn off automatically, so that kids either don't hurt their eyes or use their computers more than parents want them to.
Lin described the company's design philosophy in part as a ``meeting of opposites.''
For example, he said, it tries to make its document scanners look like books, playing on the concept of transforming knowledge.
Similarly, it used metal etching technology to put Chinese calligraphy on one of its higher-end laptops, again to give it the appearance of a Chinese book with free-flowing characters, he said.
Pan said the company is constantly on the lookout for new materials or technologies, particularly new ways to decorate materials to differentiate its products.
The company relies on firms like telecom molders Perlos Corp. of Finland and Green Point Enterprises Co. Ltd. of Taiwan for more innovative applications in decorating, Pan said, rather than just seeking out molding for speed and cost.
The company subcontracts all of its molding but retains mold- building capabilities in-house.
Of course, relying on those firms also means that the same technology will be available to competitors, so the company also constantly scouts for new applications among other industries to find something unique, he said.
``Sometimes they have manufacturing processes that are very usual for them but for us it would be very new,'' Pan said. ``We approach other industries to find technologies that others don't have.''
The company is looking at aluminum extrusion, for example, as a way to give a metal finish cheaply.
On the plastic side, Pan said it's working on using more soft plastic like thermoplastic elastomers to make waterproof phones.
For all its work with design, though, Lin said the company is still struggling with the notion of how to define the Chinese style of industrial design.
He compared the company's place to that of Taiwanese filmmaker Ang Lee, who won an Oscar this year for directing the cowboy love story Brokeback Mountain.
Like Lee, he said the company has its roots in Asia, but it wants to produce things that appeal around the world.
With Siemens, it's hoping to meld East and West, to combine the German reputation for quality and functionality with its own attempts at humanizing technology. The company's name is short for Bringing Enjoyment and Quality to Life.
Some people, he said, have wondered if it won't emerge with a new style called ``Taimany,'' for Taiwan and Germany. Lin said he's not sure, but he said that the world is still waiting for the Chinese style of industrial design to emerge.
``There is Chinese style like the dragon or whatever, but not Chinese design,'' he said, noting that the world recognizes industrial design styles like Scandinavian, Japanese, German or American.
``In the next few years, we want to try to set a style so that people can refer to it and say this is a BenQ style or this is a Taiwanese style or this is a Chinese style.''