The Economist (2008, January 10) ‘The challengers: a new breed of multinational company has emerged’
As the global landscape evolves, an increasing number of multinational organisations are both founded and based in emerging market nations. When these businesses expand outside their own national borders, it can be either to developed or developing nations. No longer is the expansion only from developed to emerging markets, but instead there is a steady transformation of the way global business is conducted. When emerging market multinationals (EMM) expand, they face their own unique set of challenges. In this discussion you will have the opportunity to analyse a case study of one such company.
Select one of the four companies highlighted in the “Developing Disruptive Products for Emerging Economies” article in this week’s Required Readings. Conduct further research on the company you chose with the goal of analysing what has enabled its success within the global marketplace. Outline your findings and theorise on how this company has been able to expand and remain relevant. What characteristics align with the indicators described by Christensen and Raynor in the above article? What lessons can you take away from this company that you could integrate into your own business practices?
The Economist (2008, January 10) ‘The challengers: a new breed of multinational company has emerged’, The Economist. Available from: http://www.economist.com/node/10496684?story_id=10496684 (Accessed: 29 January 2011).
This article describes changes in the way multinational companies are expanding, in large part due to the increased number of organisations from emerging markets. These new business have a different set of constraints than traditional countries, which affects how expansions occur.
Guillén, M.F. & García-Canal, E. (2009) ‘The American model of the multinational firm and the "new" multinationals from emerging economies’, Academy of Management Perspectives, 23 (2), pp. 23-35, Business Source Premier [Online]. University of Liverpool link: http://sfxhosted.exlibrisgroup.com.ezproxy.liv.ac.uk/lpu?genre=article&isbn=&issn=15589080&title=Academy+of+Management+Perspectives&volume=23&issue=2&date=20090501&atitle=The+American+Model+of+the+Multinational+Firm+and+the+%22New%22+Multinationals+From+Emerging+Economies.&aulast=Guill%C3%A9n%2c+Mauro+F.&spage=23&sid=EBSCO:Business+Source+Premier&pid= (Accessed: 15 December 2010).
This article contrasts the traditional “American” model of business expansion with the new model that is developing as a result of the rise in number of multinational firms that are now based in developing countries.
Hang, C.-C., Chen, J. & Subramian, A.M. (2010) ‘Developing disruptive products for emerging economies: essons from Asian cases’, Research Technology Management, 53 (4), pp.21-26, Business Source Premier [Online]. University of Liverpool link: http://sfxhosted.exlibrisgroup.com.ezproxy.liv.ac.uk/lpu?genre=article&isbn=&issn=08956308&title=Research+Technology+Management&volume=53&issue=4&date=20100701&atitle=DEVELOPING+DISRUPTIVE+PRODUCTS+FOR+EMERGING+ECONOMIES%3a+LESSONS+FROM+ASIAN+CASES.&aulast=Chang-Chieh+Hang&spage=21&sid=EBSCO:Business+Source+Premier&pid= (Accessed: 10 January 2011).
This paper examines four separate Asian firms that grew to become multinational businesses, and the authors provide some reflection on what businesses require to successfully operate in an emerging economy. The study emphasises research and development and managerial practices that are critical to providing products for underserved markets.
Khanna, T. & Palepu, K.G. (2006) ‘Emerging giants’, Harvard Business Review, 84 (10), pp.60-69, Business Source Premier [Online]. University of Liverpool link: http://sfxhosted.exlibrisgroup.com.ezproxy.liv.ac.uk/lpu?genre=article&isbn=&issn=00178012&title=Harvard+Business+Review&volume=84&issue=10&date=20061001&atitle=Emerging+Giants.&aulast=Tarun+Khanna&spage=60&sid=EBSCO:Business+Source+Premier&pid= (Accessed: 14 October 2010).
In this article, the author explores the results of a six-year study on the strategies used by organisations used to become effective global competitors regardless of financial and political restrictions imposed by their primary country.
McEwen, W., Fang, X., Zhang, C. & Burkholder, R. (2006) ‘Inside the mind of the Chinese consumer’, Harvard Business Review, 84 (3), pp. 68–76, Business Source Premier [Online]. University of Liverpool link: http://sfxhosted.exlibrisgroup.com.ezproxy.liv.ac.uk/lpu?genre=article&isbn=&issn=00178012&title=Harvard+Business+Review&volume=84&issue=3&date=20060301&atitle=INSIDE+THE+MIND+OF+THE+CHINESE+CONSUMER.&aulast=McEwen%2c+William&spage=68&sid=EBSCO:Business+Source+Premier&pid= (Accessed: 15 December 2010).
This article summarises a 10-year survey of Chinese consumers conducted by the Gallup Organization. The authors outline four different commonly held beliefs about the consumers that are not based in reality and that could be affecting the way business is conducted.
Tesfom, G. & Lutz, C. (2006) ‘A classification of export marketing problems of small and medium sized manufacturing firms in developing countries, International Journal of Emerging Markets, 1 (3), pp.262-281, Emerald [Online]. University of Liverpool link: http://sfxhosted.exlibrisgroup.com.ezproxy.liv.ac.uk/lpu?genre=article&isbn=&issn=17468809&title=International+Journal+of+Emerging+Markets&volume=1&issue=3&date=20060701&atitle=A+classification+of+export+marketing+problems+of+small+and+medium+sized+manufacturing+firms+in+developing+countries&aulast=Tesfom%2c+Goitom&spage=262&sid=EBSCO:EDS+Foundation+Index&pid=(Accessed: 8 December 2010).
After performing an extensive literature review, the authors of this article describe the most common challenges found to be impacting the ability of small and medium enterprises (SMEs) in developing countries. They categorise the issues as either internal?dealing with company or product barriers, or external—focusing on industry, market, or macro-environment issues.
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SUPPLEMENTAL RESOURCES
Articles
Adelakun, A. (2009) ‘Enhancing Nigerian competitiveness in the global economy through strategic alliances’, Economics & Management, pp.649-654.
In this article, the author argues that developing nations such as Nigeria will be more successful if they form strategic alliances with a more advanced economy. Such factors as economic performance, business efficiency, government efficiency, and infrastructure were used as a model of analysis.
Chu-Weininger, M.Y.L. & Weininger, M. (2009) ‘Cross-cultural markets and consumer behaviors: the case of China and Turkey’, Journal of Euromarketing, 18 (3), pp.189-198, Informaworld [Online]. University of Liverpool link: http://dx.doi.org.ezproxy.liv.ac.uk/10.1080/10496480903146615 (Accessed: 14 October 2010).
This article compares the emergence of China and Turkey as strong players in the global marketplace. In particular, it highlights how this emergence has affected consumer behaviours and changed consumption patterns.
Grant Thornton (2010) Emerging markets: leading the way to recovery [Online]. University of Liverpool link: http://www.grantthorntonibos.com/Reports/2010/Reports/emerging_markets/index.asp (Accessed: 15 December 2010).
This report gives insight and overview into the global positioning of emerging markets. In addition, a summary of the overall health of business populations is examined in current emerging markets.
Kim, R.B. (2008) ‘Wal-Mart Korea: challenges of entering a foreign market’, Journal of Asia-Pacific Business, 9 (940), pp.344-357, Informaworld [Online]. University of Liverpool link: http://dx.doi.org.ezproxy.liv.ac.uk/10.1080/10599230802453604 (Accessed: 14 October 2010).
This article discusses aspects of strategic fit through the case study of Wal-Mart’s unsuccessful attempt to enter Korea. Reasons provided for Wal-Mart’s failure include a poor localisation strategy and differing consumer preferences.
Luo, Y. & Rui, H. (2009) ‘An ambidexterity perspective toward multinational enterprises from emerging economies’, Academy of Management Perspectives, 23 (4), pp.49-70, Business Source Premier [Online]. University of Liverpool link: http://sfxhosted.exlibrisgroup.com.ezproxy.liv.ac.uk/lpu?genre=article&isbn=&issn=15589080&title=Academy+of+Management+Perspectives&volume=23&issue=4&date=20091101&atitle=An+Ambidexterity+Perspective+Toward+Multinational+Enterprises+From+Emerging+Economies.&aulast=Yadong+Luo&spage=49&sid=EBSCO:Business+Source+Premier&pid=(Accessed: 14 October 2010).
To gain an understanding of emerging economies, in this article the authors use an ambidexterity perspective which focuses on the both/and type of decisions businesses make in contrast to trade-offs which are either/or choices. The authors argue that multinational enterprises are uniquely situated to take advantage of such an approach.
Rivera, J.M.C. (2007) ‘An ex-post comparative analysis of SME formation in Brazil and Mexico: towards a research agenda’, International Journal of Emerging Markets, 2 (2), pp.144-165, Emerald [Online]. University of Liverpool link: http://dx.doi.org.ezproxy.liv.ac.uk/10.1108/17468800710739225 (Accessed: 8 December 2010).
Drawing data from a 2002 Inter-American Development Bank study, this article utilises a compare-and-contrast method to examine the establishment and growth of Brazilian and Mexican SMEs. The study finds that SMEs based in Brazil and Mexico face a particularly dire social and economic hardship.
Sinha, S.S. (2008) ‘Can India adopt strategic flexibility like China did?’ Global Journal of Flexible Systems Management, 9 (2/3), pp.1-14, Business Source Premier [Online]. University of Liverpool link: http://sfxhosted.exlibrisgroup.com.ezproxy.liv.ac.uk/lpu?genre=article&isbn=&issn=09722696&title=Global+Journal+of+Flexible+Systems+Management&volume=9&issue=2%2f3&date=20080401&atitle=Can+India+Adopt+Strategic+Flexibility+Like+China+Did%3f&aulast=Sinha%2c+Swapna+S.&spage=1&sid=EBSCO:Business+Source+Premier&pid=(Accessed: 15 December 2010).
In this article, the author compares China and India, two of the original BRIC nations to demonstrate how one nation (China) has been able to far exceed another BRIC country (India) in its ability to attract foreign direct investment (FDI) capital. Issues that have differentiated the success of China over India are highlighted.
Todd, P.R. & Javalgi, R.G. (2007) ‘Internationalization of SMEs in India: fostering entrepreneurship by leveraging information technology’, International Journal of Emerging Markets, 2 (2), pp.166-180, Emerald [Online].University of Liverpool link: http://dx.doi.org.ezproxy.liv.ac.uk/10.1108/17468800710739234 (Accessed: 8 December 2010).
The authors of this paper investigate various factors that must be addressed by the SMEs of India in order to reach effective expansion overseas. Among several noted factors of successful internationalisation when facing an increasingly competitive environment is the utilisation of technology and development of entrepreneurship.
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