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Multinational Management

A Casebook on Asia’s Global Market Leaders

herausgegeben von: Rien T. Segers

Verlag: Springer International Publishing

Enthalten in: Springer Professional "Wirtschaft+Technik" , Springer Professional "Wirtschaft"

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Über dieses Buch

This casebook demonstrates that the future of global business lies in how well the multinational landscape is charted and how the importance of Asian market leaders is deeply embedded in it. It offers international management students and researchers an extensive guide to the business history, strategy development, and foreign market entry modes used by emerging Asian multinationals. The cases focus on well-known companies such as Lenovo, Alibaba, Infosys, Huawei, Panasonic, and Rakuten. These companies, all of which generate huge revenues in their own countries (e.g. in China, India, South Korea, Taiwan, Vietnam), are now becoming increasingly sophisticated and striving to become global brands, while also enjoying the active support of their governments in terms of their international business.

Readers will learn about the current multinational landscape in Asia, the management challenges, and the future implications for traditional western companies seeking to retain their market share. Chapters on corporate entrepreneurship, human resource management and intercultural competence, and current branding trends in Asia will provide a cutting-edge update on international business strategy for students and practitioners alike.

Inhaltsverzeichnis

Frontmatter

Introduction

Abstract

Asia will soon reshape the global economic landscape. This undoubtedly will result in a change in the global power center—both soft and hard—from the West to the East. In global business, interactions between Asia and the West will most likely intensify. The West will encounter Asian values more than before in a working environment. In this book, we want to emphasize that hundreds of Asian companies will reach out to the world and enter the global market. At this moment, most of these new companies are relatively unknown in the West. The message of this book is that this will rapidly change. By choosing to highlight rather recently-established, multinational, companies, we hope to show what kind of strategies these exemplary companies have developed to become successful not only in their home market, but also in the world market and thus become strong competitors to their Western rivals. We have selected at least one company to analyze from the key countries of China, India, Japan, South Korea and Vietnam, with a focus on its strategies and endeavors to become a global multinational.

Rien T. Segers

China

Frontmatter

Alibaba: A Case Study on Building an International Imperium on Information and E-Commerce

Abstract

The Alibaba Group is a group of internet based businesses with a mission to make it easy for anyone to buy or sell anything, anywhere in the world, but especially to make Chinese businesses more open and accessible for the world. The revenue of the Alibaba Group is running high, since they achieve more sales than their competitors Ebay and Amazon.com together. Alibaba is the first company to make market information and data available for free to all the users, all over the world. Customers/providers of goods can expand the reach of their business quickly. In addition, the connection system of Alibaba and how they connect business people with suppliers is fascinating. Their business strategy has made them both well-known and successful in Asia already. Alibaba’s international interest is to get more access to popular Western brands, especially high-end and luxury brands, given the huge unmet demand among Chinese consumers for products that are not yet available in China. For that matter, it is likely that Alibaba will become a successful brand for retailers all over the world for selling their products and since the world is getting smaller, perhaps even for B2B or C2C markets.

Marieke Havinga, Martijn Hoving, Virgil Swagemakers

Geely: A Case Study on the Trend Following Volvo-Owner

Abstract

This chapter focuses on Geely, a Chinese car manufacturer, who is not even a leading player in its domestic market, but has recently become the largest exporter of cars from China. This has been done through both acquisitions and fast technological development. Geely follows a clear strategy and aims to become a leading global player through its quality products, great safety standards, and excellent sales and after sales services, as well as through competitiveness in pricing. Strategic investments worldwide, acquisitions of renowned companies such as Volvo, and continuous development of its human capital, its know-how and product range all place Geely into a position where they should be considered as a serious competitor, certainly in the next decade. The reason for Geely’s success can be summarized in the following points: good enterprise culture and philosophy, the right time and right place, and “Go with the trend”: good strategies for different times. Building upon its strength, it is very likely that Geely will become a world brand.

Gero von Bismarck, Yunyao Zheng

Haier: A Case Study on How One of China’s First Global Brands Keeps Expanding

Abstract

In less than 30 years, the nearly bankrupt Qingdao Refrigerator Factory transformed itself into Haier, one of China’s first global brands. With its roots in the consumer appliance market, Haier extended its product portfolio also to the consumer electronic market. The company succeeded in transforming itself from an imitating manufacturer to one of the world’s most innovative companies. Using knowledge from several sources, Haier is able to stay up-to-date with consumers’ constantly changing needs. Furthermore, Haier is constantly developing and adjusting its business strategies to meet the demands of the changing market environments. Haier refrained from major brand acquisitions to enter developed markets at the beginning of its internationalization process. Instead of purchasing an existing domestic brand to enter international markets, Haier focused on positioning itself as a local brand in the different world markets by using local staff who would build up a market-specific brand. In order to reduce its strong dependency on its domestic market, Haier is likely to extend its global activities in the more mature markets (North America and Western Europe) in the near future.

Florian Pallas

Huawei: A Case Study on a Telecom Giant on the Rise

Abstract

For many years, Huawei was only an Original Design Manufacturer (ODM), which means that the company only developed and designed mobile phones for other manufactures. In 2011, the company switched its vision and also decided to produce mobile phones under their own name. Furthermore, since 2012, Huawei is rushing to the European market. Its vision is to become one of the top three world smartphone brands. The focus of Huawei is on continuous innovation that is customer-centric and improving customer service quality. Huawei is also the third largest applicant for patents in the world. The company is capable of offering innovative products for a cheaper price, sometimes even more than 25 % cheaper than similar products of its competitor. Africa’s mobile technology progression would not have been as far as it is now without Huawei and its cheaper products. The success of Huawei could also be due to the help that Huawei is accused of receiving from the Chinese government. However, this could also be something that is stopping Huawei from entering markets, as Huawei could represent a national security threat.

Michelle Haveman, Jeroen Vochteloo

Lenovo: A Case Study on Strengthening the Position in the European Market Through Innovation

Abstract

Lenovo is a Chinese company operating in the computer and ICT area with great success in its domestic market. The product range is spread over computers (laptops) as well as smartphones for private and for professional users. Lenovo’s strengths are the high quality of electronic devices, ease of use, and selling the devices for an acceptable and fair price. The supply chain of Lenovo is very strong and effective as well as efficient. Lenovo and its specific product segments can become a world brand. The increase in sales and market shares was achieved by mergers and acquisitions which are limited by nature. So, it might be a challenge for Lenovo, when the time is ripe, to further develop its business with its own resources.

Franz Josef Gellert

Tencent: A Case Study on Expanding Through Micro-Innovation and Strategic Partnerships

Abstract

Tencent is a Chinese IT company that offers a wide variety of products in the e-commerce, online advertising, online games and social network markets. Most of these services are centered around the central hubs of QQ and Weixin/WeChat. This allows for a spillover of users and a brand name that can be used for a variety of products. Most of Tencent’s software products are free to use, but allow users to buy small cosmetic upgrades. For Tencent, these value-added services are the main source of income. This differentiates the company from most of its competitors, which still rely mostly on online advertisements to monetize users of free services. Tencent focuses on ‘micro-innovation’, taking a proven concept and adjusting it to the Chinese market. The company is very strong in the domestic market, but has had trouble in foreign markets. More recently, Tencent started strategic partnerships with companies in segments where the company cannot become market leader on its own. Perhaps the company could also use this strategy for foreign market entry.

Filip Vedder

India

Frontmatter

Dr. Reddy’s: A Case Study on Conquering the World with Affordable Medicine for the Masses

Abstract

Dr. Reddy’s Ltd. has become a global player within the American, Asian and European pharmaceutical markets over the last 30 years, having started as a small pharmaceutical ingredients supplier in 1984. This success was due to three key factors: a strong corporate governance, long term thinking and innovativeness, and control of the entire value chain. The advantage gained through R&D will be the main driving factor for the company to increase its market share within the next few years and to develop new long-term strategies. Company acquisitions and local production in key markets such as Europe, Russia, and emerging markets enhance the supply chain by being continuously able to strengthen and expand to new pharmaceutical markets in a growing number of countries. Good relations with governments, the willingness and understanding to open up foreign manufacturing plants, and not only importing products but strengthening different countries’ economies, make Dr. Reddy’s a reputable company which will show much more of its potential within the next years.

Maximilian Egender, Irina Rotari

Infosys: A Case Study on Becoming a Global Brand in Consulting Technology and Outsourcing Solutions

Abstract

Infosys is a global leader in consulting, technology, and outsourcing solutions. This chapter examines the national and international context of the company, and its services and global presence. The strategy at Infosys is to strengthen the value of all its employees and constantly invest in developing their competencies. Infosys, being a global brand, might be interested in the knowledge and experience in a region such as the Northern Netherlands, but it would require several actions to be undertaken at the same time in the framework of the triple helix, by the government, industry and academia.

Mariusz Soltanifar

Japan

Frontmatter

Panasonic: A Case Study on Constant Change and Reinvention of a World Brand

Abstract

Panasonic’s nearly one hunderd-year history can be divided into several phases. The constant factor in Panasonic’s history was—and is—change. And this may also contain the simple answer to the question about Panasonic’s secret of success: the ability to transform as required by an ever-changing environment, the willingness to keep developing, and the openness to learn and take risks have been engrained in the company’s collective memory. Giving up is not an option, and the only way out is the way forward. Therefore it can be boldly concluded that Panasonic as a corporation will still exist 50 years from now, and maybe even a 100 years from now. The company may look differently, produce different products or services, and market them in a completely different way, but chances are high that Panasonic will still be a major player in the domestic and global markets.

Uli Mathies

Rakuten: A Case Study on Entering New Markets Through an Innovative Business-to-Business-to-Consumer Strategy

Abstract

In its home country of Japan, Rakuten found a great domestic market situation to start off an e-commerce company in 1997. With its online shopping mall Rakuten Ichiba, the company was able to undercut prices and systematically cut out the middlemen. But Rakuten’s success was not only characterized by external factors. The company aimed for an online marketplace where buyers and sellers meet to conduct trade. Its platform combined technology with human expertise in order to empower people such as local retailers to sell their products online without worrying about technological and logistical aspects. The company levered the Japanese hospitality to build a reliable corporate culture and shaped an outstanding service that focuses on encouraging long-term relationships between merchants and customers. Strategic acquisitions have shaped an ecosystem that is currently seen as the most diverse and encounters people in many everyday life situations. A constant focus on global expansion and untapped business and niche segments contributes to its overall success.

Thomas S. Willenborg

Uniqlo: A Case Study on Creating Market Share with Affordable and Timeless Designs

Abstract

The Japanese designer, manufacturer, and retailer, Uniqlo, is known for casual, high-quality clothing for very affordable prices. During the Japanese recession, the company was valued especially for its low prices. They soon expanded their business throughout Japan. Step-by-step, they expanded internationally and were then competing successfully with the major fashion retailers. Today, it is the fourth largest fashion retailer worldwide. Uniqlo made it possible to successfully educate countries worldwide, within less than 25 years, in its unique product strategy and it is still continuing to enlarge its business operations. By 2020, the company is aiming to become the world’s biggest specialty retailer of private label apparel with a continuous growth rate of 20 %. The company’s success can be explained by its initial success during the Japanese crisis. The consumer’s demand for affordable but high quality clothing was high during this time of recession, as consumers had to cut back on expenditures. After this sudden success, Uniqlo’s founder Tadashi Yanai managed to expand brand awareness and achieved success globally.

Frederike Schulz-Müllensiefen, Aenne Stöckmann

South Korea

Frontmatter

Lotte: A Case Study on Market Entries Through Acquisition

Abstract

The Lotte Group operates in 19 foreign countries and entered also the European market with acquisitions. The company owns a strong market position in South Korea and is also known as the “leading retailing company in South Korea” with a 10 % value share in South Korean retailing in 2012. Furthermore, the company owns a fast food chain with the biggest value share, and even outperforms Hyatt Hotels Corp., Wyndham Worldwide Corp. (Ramada), and Starwood Hotels and Resorts Worldwide (Sheraton) with its hotel chain Hotel Lotte Co., Ltd., and thus is the leading company in South Korea’s travel and tourism industry. Lotte Group’s unrelated diversification, mainly through acquisition, drives the basis of past, present and prospective success and is enforced through triple-helix support. If the conglomerate continues its expansion in Europe, branded divisions would only be found within hospitality or, less probably, in retail. The conglomerate grew through acquisition and it is most unlikely that it will attempt to convey its brand success to Western countries. Win-win growth through acquisition is more to be expected in Europe.

Manuel Schlothauer, Denise Wilhaus

Vietnam

Frontmatter

Vinamilk: A Case Study on Partnering Up to Expand on the World Market

Abstract

Vinamilk has continued to be a pioneer in the food industry because of four reasons. First of all, Vinamilk’s product research and technology development have been increasingly improved and updated to ensure food safety in their new products in order to change the domestic consumer behavior that exists in Vietnam, namely the consumer perception that dairy products made in France or the Netherlands would be the best choice. Secondly, Vinamilk has effectively invested in brand building and market expansion. The company pays attention to studies on local markets, and to consumer habits, age, and gender demands to let its retailer network grow and to promote each specific product in different areas of Vietnam. Moreover, Vinamilk also is spreading to overseas markets, including the difficult markets such as the USA, Australia, Cambodia, Laos, New Zealand, and Middle East countries. Thirdly, investing in people is the core of success for Vinamilk. Finally, in order to have sustainable development as well as preserve prestige in the market, respect for business ethics and the actions to bring sustainable values to the society and the community play a very important role.

Kim Nguyen

Underlying strategies and success factors of emerging Asian multinationals

Frontmatter

Corporate Enterpreneurship and Triple Helix

Abstract

Triple Helix (TH) is a concept well known, understood, and applied by many Asian Multinationals (AMNC), and it plays an important role for economic growth and regional development. It seems to be influenced by networks and partnerships and their complexity as well. Corporate entrepreneurship (CE) has been widely acknowledged in international literature and practiced as a vital element of business performance. CE mainly relates to a corporate management style that integrates risk-taking and innovative approaches, as well as reward and motivational techniques that are more traditionally thought of as being the province of entrepreneurship. By encouraging innovation and enriching business performance, CE offers great fundamentals for cooperative development between the government, educational institutes, and businesses. In a constantly demanding environment, the dual forces of technological change and globalisation-heightened competition do have an impact on the way how businesses operate. To cope with this, organizations should fully understand the different meanings of CE, at any level, and try to apply it properly to all decisions made in the framework of TH’s cooperation.

Mariusz Soltanifar

Asian Human Resource Management and Intercultural Competence

Abstract

While intercultural competence is an emerging topic in international HRM, it is of less importance so far in Asian HRM. Meanwhile, Asian entrepreneurs do seem to act competently in cross-cultural environments. Where Western scholars have claimed that intercultural competence does not come naturally, the current success of Asian businesses non-Asian regions can be partly explained from the interculturally competent behavior of its international professionals. This behavior is related to intrinsic and authentic Asian values aimed at “unity” or “harmony”. The Eastern mind-set is focused on relations prior to the tasks, and once a relationship has been established, the opportunities for collaboration will arise. By adhering to the principles of ancient philosophies, Asian entrepreneurs have pragmatically resolved conflicts of interest. This seems to reverse Allport’s contact hypothesis that a shared goal and intergroup collaboration is required for improvement of the understanding of the other. What we witness is that once the technological and informational hurdles have been taken, adherence to authentic Asian behavioral guidelines forms a good starting point for effective international business.

Marcel H. van der Poel

Branding Trends in Asian Markets

Abstract

This chapter examines current branding trends in significant Asian markets, namely Japan, South Korea, and India, with a special focus on one emerging branding nation, China. No generalizations towards the whole of Asia can be drawn from this research. However, research identified some aspects in the field of branding that have occurred in different Asian markets at different times. For example, the development of branding as a management strategy followed benefit-driven product management in both Japan and South Korea some decades ago. This development can now be witnessed in selected industries in China. Whether or not other Asian nations show similar developments (e.g. Indonesia) would be a topic for further investigation. Nevertheless, the following four Asian branding trends serve as the main outcomes of this research: extending the corporate brand into new fields of business, extending the corporate brand into diverse product categories, acquisition of Western brands by Asian investors and top-management support in brand building.

Diederich Bakker

Conclusion

Frontmatter

Conclusions: Why and How Asian Businesses Will Conquer the World

Abstract

When analyzing the company cases in this book, six similarities can be found: the corporate culture of the companies, their adaptability, the drive to internationalize, the Triple Helix as a facilitator of their success, the quality of the products, and finally, their competitiveness based on the combination of all these similarities. Obviously, there are many differences as well. These differences are a result of the way the companies try to realize the similarities. Broadly speaking, the differences are dependent on: (1) differences between countries (cultural identity) and (2) differences between companies (the specific character of entrepreneurs). The differences in the political-economic systems of Asian countries have a strong implication for the international drive of Asian companies. The implicit claim of most chapters in this book is that Asian companies will flock to the West in ever-increasing numbers. In the coming years, this concerns companies primarily coming from countries we have been dealing with in this book: China, India, Japan, South Korea and Vietnam. As an example we show the recent developments of Chinese outward foreign direct investment in the Netherlands.

Rien T. Segers, Filip Vedder

Titel: Multinational Management
herausgegeben von: Rien T. Segers
Verlag: Springer International Publishing
Electronic ISBN: 978-3-319-23012-2
Print ISBN: 978-3-319-23011-5
DOI: https://doi.org/10.1007/978-3-319-23012-2