Mutinational 事务所的业务策略-Business Strategies of Mutinational Firms from
03-10, 2014
1 Introduction引言
全球化是一个当下不断在经济学领域引用的词汇。不管是个人还是组织，我们都生活在一个更加全球化的社会中，而且会比以往的一百年前或者五十年前甚至是二十年前发展的更快，产品和服务都将在全球范围内予以提供。
Globalization is not a new word in today`s economic field. For a single person and the organization, we live in a more global society than 100 years ago, or 50 years ago, or 20 years ago. Products and services are offered on a global basis. Human societies across the globe have established progressively closer contacts over many centuries, but recently the pace has dramatically increased.
因此，用市场评估及进入策略来运行最佳的策略实践和一些关键问题，并以此反应新兴市场。这些共享服务的利用反应在重要的文化、组织及人力资源问题上，是不落时的。本文旨在帮助你理解和规划你的商业策略，同时考虑进入新兴市场。
Therefore, it is not late now to reflect on the emerging markets, and some key issues like market assessment and entry strategy, operating best practices and leveraging shared services operations, and reflect on the most important cultural, organizational and human capital issues. This paper maybe is a help to understand and plan your business strategies while considering to entry the emerging market.
Marketing economic theory holds that a completely liberalized global market is the most efficient way to foster growth, because each country specializes in producing the goods and services in which it has a comparative advantage. Throughout history, adventurers, generals, merchants, and financiers have constructed an ever-more-global economy.Today's marketplace is quickly becoming international in scope because of the process of globlization. So it become a major driver that has impact on nearly every business and the change of global market. More and more businesses are looking to markets outside the country to stimulate growth and revenue. Multinational corporations manufacture products in many countries and sell to consumers around the world. Money, technology and raw materials move ever more swiftly across national borders. Along with products and finances, ideas and cultures circulate more freely. Thus, it is during the past decades companies and their managers have started to face increased emphasis on globalization since it has affected and occurred at all levels in organizations’ stakeholder relations(Hubbard, 2004). Hence, more organizations are becoming international and are therefore forced to handle complex issues on international/global basis rather than on a domestic one(Hill, 2006).
Today, unprecedented changes in communications, transportation, and computer technology have given the process new impetus. Transportation advancements allows us to travel anywhere in the world within 24 hours. Technology has increased information sharing and allows us to communicate with each other from anywhere. Increasingly transparent capital markets are spreading the same concepts globally. These are just some examples of our more homogenous world. This process, or fundamental shift, is referred to as globalization(Meredith & Shafer, 2001).#p#分页标题#e#
Contrary to the global developed market, there are a new market called emerging market. This concept of the emerging market is beginning wth last decade. With the rapid global spread of international business operations emerging market economies are of key importance for international business. As global businesses look to emerging markets for growth, sourcing, and outsourcing, best-of-breed strategy and execution in these markets have become crucial to global success(Charles, 2008). However, since the idea of emerging market is brought into the developed market, emerging market economies (EMEs) have experienced large and persistent fluctuations of aggregate economic activity at the end of the 1990s. Crises episodes in the last decade (such as the Tequila and East Asian Crisis, depreciation of the Brazilian and Russian currencies) have increased the interest in disentangling the sources of economic crisis episodes(Eric, 2008). For example, if you are used to doing business in North America and Western Europe, you understand the risk analysis required to successfully operate in other parts of the world. But doing business in emerging market economies requires a very different examination of the risks you might encounter.
2 What is an Emerging Market什么是新兴市场
An emerging market, its antonym is developed market, defineing a country having an economy with a very low current gross domestic product per capita (GDP) with an above-average economic growth potential is an emerging market, liking China and India. The annual GDP per capita for China and India for example is under $1,000, whereas the United States, Japan, and countries in Western Europe have GDPs per capita ranging from $24,000 to $36,000 per year(Anthony and Rajna, 2008). The above-average growth potential in emerging markets makes these countries attractive for investment but the low current GDP creates one of the major initial challenges. Useing certain administrative criteria, in addition to the definition above, to determine whether a country is considered an emerging market: (1) Lower revenues (ARPU) for broadband services; (2) Fewer customers can afford to purchase their own customer premise equipment; (3)Higher churn and higher percentage of bad debts can result in higher operating expense; (4)Lower percentage of households own personal computers thus reducing the size of the addressable market for broadband services.
However, there is no fixed list of "emerging market" countries. Because funds are limited and the range of emerging markets is worldwide. So while identifying the emerging market, a executive must have good knowledges of the economy development in the emerging market, sometimes, also the political and social systems and product too. There is the next parts to discuss the strategies how to sustain the business in the emerging market.
3 Business strategies in emerging markets新兴市场中的商业策略
#p#分页标题#e#
Emerging markets present opportunities as well as challenges for businesses and executives from advanced economies. Most emerging market economies have attained their importance within the global economy through sustained government effort and distinctive policies aimed at promoting growth and development. For an organization, operating in emerging markets involves identifying, investing in, and managing business opportunities in such markets. While the business environment in emerging markets is increasingly moving in the direction of norms in advanced economies, there are fundamental differences that business executives and managers have to address when managing business in emerging markets. These include adjustments to the host countries' macroeconomic structure, control of financial and currency exposure, management of business-government relations, dealing with inadequacies in infrastructure, and the handling of thorny issues of business ethics, intellectual property right protection, and workers' rights and working environment(İbrahim,2008). Effective management in emerging markets requires a conscientious understanding of the often opaque set of conditions in the host country, proactive attitudes toward the opportunities and challenges, and long-term strategies and enduring efforts.
Nowadays, many international organization increasingly regard competing successfully in emerging markets as key to their corporate strategy. It is admitted that Identifying the opportunity these markets represent, however, is the easy mission. The much more difficult task is determining what it takes to sustain profitable growth in these markets. That is why setting and executing the right strategies for profitable growth in these markets is so critical. Thus, this paper identifies and analyzes strategic initiatives that global managers and executives must take into account in emerging markets before action.
3.1 Identification Emerging Market Opportunities识别新兴市场的机会
Companies in the world are increasingly looking to emerging markets like China as a vital source of growth. The problem is these companies often lack an effective strategy for identifying which countries to do business with. In a June Harvard Business Review article, excerpted here, the authors, Tarun and Krishna(2005) present a "five contexts framework"—issues to consider, in essence—to understand institutional variations between countries. We excerpt a summary of the five contexts. They helped companies think through their globalization strategies, developed a simple conceptual device—the five contexts framework—that lets executives map the institutional contexts of any country. These companies buy inputs in the product, labor, and capital markets and sell their outputs in the products (raw materials and finished goods) or services market. When choosing strategies, therefore, executives need to figure out how the product, labor, and capital markets work—and don't work—in their target countries emerging markets. This framework will help them understand the differences between home markets and those in oversea emerging market. In addition, each country's social and political milieu—as well as the manner in which it has opened up to the outside world—shapes those markets, and companies must consider those factors, too.#p#分页标题#e#
The five contexts framework places a superstructure of key markets on a base of sociopolitical choices, also creates a map of each country's context and to gauge the extent to which businesses must adapt their strategies to each one. According to the framework, there are five contexts including political and social systems, openness, product markets, labor markets and capital markets.
(1) Political and social systems.Every country's political system affects its product, labor, and capital markets. In socialist societies like China, for instance, workers cannot form independent trade unions in the labor market, which affects wage levels. A country's social environment is also important. In South Africa, for example, the government's support for the transfer of assets to the historically disenfranchised native African community—a laudable social objective—has affected the development of the capital market(Jeremy, 2005). Such transfers usually price assets in an arbitrary fashion, which makes it hard for multinationals to figure out the value of South African companies and affects their assessments of potential partners.
(2) Openness. The more open a country's economy, the more likely it is that global intermediaries will be allowed to operate there. Multinationals, therefore, will find it easier to function in markets that are more open because they can use the services of both the global and local intermediaries(Raj and Sitabhra, 2008). However, Openness could be a double-edged sword.a government that allows local companies to access the global capital market neutralizes one of foreign companies' key advantages.
(3) Product Markets, labor markets and capital markets. These three contexts have become the consequently factors that must be considered and investgated. Because in developing countries the market research and advertising are in their infancy, and it's difficult to find the deep databases on consumption patterns that allow companies to segment consumers in more-developed markets((Eric, 2008)). In spite of emerging markets' large populations, however, multinationals have some troubles recruiting managers and other skilled workers because the quality of talent is hard to ascertain. Moreover, the capital and financial markets in developing countries are remarkable for their lack of sophistication. Apart from a few stock exchanges and government-appointed regulators, there aren't many reliable intermediaries like credit-rating agencies, investment analysts, merchant bankers, or venture capital firms.
Therefore, for managers and executives, it is necessary to reflect and identify the target market whether the emerging market is a suitable investing destination.
3.2 Management管理
Over the years, far too many international firms simply make minor adjustments to existing products, reduce prices, and replicate existing distribution channels in the emerging market. But it is proved that this strategy just won’t work gor the long-term.#p#分页标题#e#
From the lessions of many competitive operational strategies, it has learned is that to achieve sustainable commercial success in emerging markets, global organization must instead embrace a strategy based around innovation. This means that the stategies practiced in the emerging market must essentially acquire an entirely new set of skills and organizational structures that addresses the special requirements of both consumer and industrial buyers in these markets. In this part, two citical strategies have been reviewed while doing business in emerging market.
(1) Rethinking value---products and price反思的价值---产品和价格
Customers in emerging markets are becoming more sophisticated and demanding, expecting products that satisfy their special requirements and preferences. So for the international firms, serving the majority of emerging market consumers and industrial buyers will often require manufacturers to design special products tailored to the special needs of emerging market customers, often priced far below their offerings in developed markets(Vasilis and Graham, 2008). The competition to develop special products and services that meet those needs, by firms both from developed and from emerging economies, is now fierce. The drive to rethink product offerings holds the promise of yielding potentially“disruptive”innovations that create new markets by addressing the needs of customers not being served effectively.
Successful companies have realized that they need to customize existing products or design new products that appeal to local tastes and requirements. The Dutch manufacturer Royal Philips Electronics (“Philips”) is a good example of a company that has taken this philosophy to heart(Philips, 2005). Since electric power in emerging markets is often unreliable, Philips employed technologies originally developed to extend the life of torches for rural villagers to build lights that stay powered for several hours even if the main power fails. They have also manufactured lights that can withstand the power fluctuations that are common in India and other emerging markets. By understanding the unique environment and buyer needs in emerging markets, manufacturers often find they need to tailor their special products in the target emerging matkets. Mahindra & Mahindra, the Indian automaker, has created vehicles with stronger suspensions to withstand the poor roads in the country. The company has found that these products also have a market in other countries with poor infrastructure, such as some countries in Africa. In competing for the Indian market, the auto manufacturer, Hyundai Motor Company Ltd. Of South Korea, adjusted its design so that women wearing traditional Indian dresses could get in and out of the car easily.
The price is a problem in the emerging market. Because the countries cataloged into the emerging market usually have lower-income and middle-income consumers. Although their aggregate buying power is enormous, the GDP per capita in most emerging markets is far below that in developed markets. While per capita GDP in 2004 using purchasing power parity was roughly US$39,800 in the United States, it was US$7,940 for Brazil, US$5,890 for China, and US$3,120 for India(Jeremy, 2005;Ross and Ian, 2007). Most products sold in developed markets are simply beyond the means of all but the most affluent emerging market customers. Thus, for the international firms it usually offer unique products at dramatically lower prices to match the special needs and lower purchasing power of most emerging market buyers.#p#分页标题#e#
(2) Recruitment and delection strategy in multicultural workforce多元文化的决定策略
In emerging market, compared with advanced economies, there are mostly labor abundant and enjoy advantages in labor-intensive products. One of the major motivations of foreign investment in emerging markets is to take advantage of the low labor cost and engaged in labor-intensive manufacturing. Managing relations with local employees is crucial to the productivity and sustainability of operations in emerging markets. Workers in many emerging markets appear to be less demanding in terms of compensation, working environment, and workers’ rights. Labor laws are either incomplete or inadequately enforced in some emerging markets. Managers should not take this for granted, for those who maintain high welfare standards for their employees will stand out among competitors in the long run. Local firms in emerging markets often look up to foreign operations for examples of management of relationships with employees. Successful companies have brought their home country practices to emerging markets and are rewarded for employee satisfaction and productivity improvement.
However, on the other side, although seen as an inexhaustible supply of low-cost labor, it is usually face the fact that there are a problem to lack of skilled labor that are all too familiar in developed countries. And in fast-growing emerging markets, the need to rapidly recruit and develop skilled employees is all the more critical. Thus manufacturing executives will need to rethink how they recruit, develop, deploy, and connect the skilled employees on whom they rely. Companies are competing for the best talent by offering higher salaries, increased benefits, and more opportunities for professional development. Global firms should rethink that they need to balance the efficiency afforded by their company-wide human resource policies with the need to accommodate local expectations and cultural norms. These local variations can range from providing more holidays and sick leave in Russia and Eastern Europe to adding softer, less quantifiable factors to performance evaluations in India.
4 Case study---Nokia in emerging market案例分析，诺基亚的新兴市场
When you ask people including the person in the emerging market what there favourite phone brand is, many respond "Nokia". Indeed most phone owners have owned a Nokia in the past. Some users are tempted by other manufacturers phones such as Motorola, but many find that the quality of build and usability is lacking when compared with Nokia models.
Look back to the histroy of Nokia, after the strategic change of 1992, Nokia saw a huge increase in sales to North America, South America and Asia. In 1998, Nokia becomes the world’s biggest mobile phone manufacturer. Between 1996 and 2001, Nokia’s turnover increased almost fivefold from EUR 6.5 billion to EUR 31 billion. Therefore, it is said that 1990s also saw unparalleled growth in global market for Nokia(Jussi, 2007).#p#分页标题#e#
Specifically for emerging markets, Nokia’s created a set of phones such as the launched seven handsets(News, 2007). For example, The dual-band GSM Nokia 1200 and 1208 are designed a "dust resistant" keyboard, and some designed to make it easy for the customers to be shared by families. In many emerging market, many villages do not have access to basic telephony, then Nokia helps bring mobile connectivity to these areas through the “wireless village” approach. This approach builds on entrepreneurship, avoids massive roll-out costs and investments on the part of network operators, and is affordable for low-income consumers. However, in many emerging markets, lower income consumers face financial barriers that make it impossible to own a mobile phone. But there is one way to increase opportunities for connectivity for these important entry-level consumers – phone sharing. Thus the Nokia practice the price war with its competitors liking Motorola, LG, Samsung and Sony. For instance, in China, Nokia has increased quarterly sales of mobile phones by 40 per cent over the past year, almost twice its average global growth rate, according to CEO Olli-Pekka Kallasvuo. Partly as a result of its strength in price-conscious emerging markets, Nokia has the lowest average prices among the world's five major mobile phone makers, according to estimates from Tokyo-based Nomura Securities. Nokia's average handset price fell below $120 in the most recent quarter, compared to prices of more than $130 for Motorola and LG's products, and around $180 for Samsung and Sony-Ericsson(Jussi, 2007).
From this example, in emerging market such as China and India, Nokia have present a good case study for the firms which want to expand their business into the emerging market. It is suggested that firms should first research the market characteristics and the economic development situation, then establish some competitive operational strategies according the emerging market before entrying it.
5 Conclusion结论
To summary, compared with the global developed market, emerging market for economic growth, sourcing, and outsourcing, best-of-breed strategy and execution in these markets have become crucial to global business success. These markets play the same importance for the increasing global international companies. So how to achieve a sustainable development in these emerging market become a hot topic in today`s global business environment. This paper have introduced the concept of this market and offer some citical considerations and strategies while entrying emerging market. It is suggested that a minute identifications of emerging market situation including the political and social system, openness, product markets, labor markets and capital markets become the first important step, and the second step is planning an operational strategies which could improve the goals of firms and maintain the sustainable development in the emerging market. Therefore, as executives or leaders for a international organization, the strategies worked effectively in developed market is not mean that will work in the emerging market, some necessary modifies should be employed before taking into practice.#p#分页标题#e#
In a word, please remember the saying that “look before you leap”, when you plan to entry the emerging market.
Reference:参考文献
Andy Reinhardt and Elizabeth Johnson, “Cell Phones for the People,”BusinessWeek, November 14, 2005;
Anthony C. and Rajna G., 2008. Financial integration, economic instability and trade structure in emerging markets, Journal of International Money and Finance 27(4), 654-675
Charles A.Y., 2008. Financial development, the structure of capital markets, and the global digital divide, Information Economics and Policy, 20(2), 208-227
Eric R., 2008. Cooperative ventures in emerging economies, Journal of Business Research, 61(6), 640-647.
Hill, C. W. L. (2006). International Business: Competing in the Global Marketplace (6th ed.). New York, NY: McGraw-Hill.
Hubbard, G. (2004). Strategic Management: Thinking, Analysis & Action (2nd ed.). Frenchs Forest, NSW: Prentice Hall.
İbrahim B.K., 2008. Asymmetric impacts of global risk appetite on the risk premium for an emerging market, Physica A: Statistical Mechanics and its Applications, 387(13), 3218-3226
Jeremy Grant, “The Switch to the Lower-Income Consumer,”Financial Times, November 15, 2005.
Jeremy Grant, “Check the Depth of the New Customer’s Pocket,”Financial Times, November 16, 2005.
Jussi S. J., 2007. Men, money and mobile phones: Tracing the technology discourse in Finnish newspapers, Technology in Society, 29(1), 79-91
Meredith, J. R. & Shafer, S. M. (2001). Operations Management for MBAs (2nd ed.). Hoboken, NJ: John Wiley Sons, Inc.
News, 2007.Nokia launches new NFC handset, Card Technology Today ,19(1), 7
“Philips Opens Low Cost Mobile R&D Center In Shanghai,”Dow Jones International News, November 11, 2005.
Raj K. P.and Sitabhra S., 2008. Inverse-cubic law of index fluctuation distribution in Indian markets, Physica A: Statistical Mechanics and its Applications, 387(8-9), 2055-2065
Ross S.and Ian M., 2007. Global GDP shares in the 21st century—An equilibrium approach, Economic Modelling, 24(6), 859-877
Tarun K. Krishna G.P. and Jayant S, 2005. Excerpted with permission from Strategies That Fit Emerging Markets, Harvard Business Review, 83(6), 84-90
Vasilis T. and Graham H., 2008.Customer orientation and innovativeness: Differing roles in New and Old Europe, International Journal of Research in Marketing, 25(1), 69-79
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全球化是一个当下不断在经济学领域引用的词汇。不管是个人还是组织，我们都生活在一个更加全球化的社会中，而且会比以往的一百年前或者五十年前甚至是二十年前发展的更快，产品和服务都将在全球范围内予以提供。
Globalization is not a new word in today`s economic field. For a single person and the organization, we live in a more global society than 100 years ago, or 50 years ago, or 20 years ago. Products and services are offered on a global basis. Human societies across the globe have established progressively closer contacts over many centuries, but recently the pace has dramatically increased.
因此，用市场评估及进入策略来运行最佳的策略实践和一些关键问题，并以此反应新兴市场。这些共享服务的利用反应在重要的文化、组织及人力资源问题上，是不落时的。本文旨在帮助你理解和规划你的商业策略，同时考虑进入新兴市场。
Therefore, it is not late now to reflect on the emerging markets, and some key issues like market assessment and entry strategy, operating best practices and leveraging shared services operations, and reflect on the most important cultural, organizational and human capital issues. This paper maybe is a help to understand and plan your business strategies while considering to entry the emerging market.
Marketing economic theory holds that a completely liberalized global market is the most efficient way to foster growth, because each country specializes in producing the goods and services in which it has a comparative advantage. Throughout history, adventurers, generals, merchants, and financiers have constructed an ever-more-global economy.Today's marketplace is quickly becoming international in scope because of the process of globlization. So it become a major driver that has impact on nearly every business and the change of global market. More and more businesses are looking to markets outside the country to stimulate growth and revenue. Multinational corporations manufacture products in many countries and sell to consumers around the world. Money, technology and raw materials move ever more swiftly across national borders. Along with products and finances, ideas and cultures circulate more freely. Thus, it is during the past decades companies and their managers have started to face increased emphasis on globalization since it has affected and occurred at all levels in organizations’ stakeholder relations(Hubbard, 2004). Hence, more organizations are becoming international and are therefore forced to handle complex issues on international/global basis rather than on a domestic one(Hill, 2006).
Today, unprecedented changes in communications, transportation, and computer technology have given the process new impetus. Transportation advancements allows us to travel anywhere in the world within 24 hours. Technology has increased information sharing and allows us to communicate with each other from anywhere. Increasingly transparent capital markets are spreading the same concepts globally. These are just some examples of our more homogenous world. This process, or fundamental shift, is referred to as globalization(Meredith & Shafer, 2001).#p#分页标题#e#
Contrary to the global developed market, there are a new market called emerging market. This concept of the emerging market is beginning wth last decade. With the rapid global spread of international business operations emerging market economies are of key importance for international business. As global businesses look to emerging markets for growth, sourcing, and outsourcing, best-of-breed strategy and execution in these markets have become crucial to global success(Charles, 2008). However, since the idea of emerging market is brought into the developed market, emerging market economies (EMEs) have experienced large and persistent fluctuations of aggregate economic activity at the end of the 1990s. Crises episodes in the last decade (such as the Tequila and East Asian Crisis, depreciation of the Brazilian and Russian currencies) have increased the interest in disentangling the sources of economic crisis episodes(Eric, 2008). For example, if you are used to doing business in North America and Western Europe, you understand the risk analysis required to successfully operate in other parts of the world. But doing business in emerging market economies requires a very different examination of the risks you might encounter.
2 What is an Emerging Market什么是新兴市场
An emerging market, its antonym is developed market, defineing a country having an economy with a very low current gross domestic product per capita (GDP) with an above-average economic growth potential is an emerging market, liking China and India. The annual GDP per capita for China and India for example is under $1,000, whereas the United States, Japan, and countries in Western Europe have GDPs per capita ranging from $24,000 to $36,000 per year(Anthony and Rajna, 2008). The above-average growth potential in emerging markets makes these countries attractive for investment but the low current GDP creates one of the major initial challenges. Useing certain administrative criteria, in addition to the definition above, to determine whether a country is considered an emerging market: (1) Lower revenues (ARPU) for broadband services; (2) Fewer customers can afford to purchase their own customer premise equipment; (3)Higher churn and higher percentage of bad debts can result in higher operating expense; (4)Lower percentage of households own personal computers thus reducing the size of the addressable market for broadband services.
However, there is no fixed list of "emerging market" countries. Because funds are limited and the range of emerging markets is worldwide. So while identifying the emerging market, a executive must have good knowledges of the economy development in the emerging market, sometimes, also the political and social systems and product too. There is the next parts to discuss the strategies how to sustain the business in the emerging market.
3 Business strategies in emerging markets新兴市场中的商业策略
#p#分页标题#e#
Emerging markets present opportunities as well as challenges for businesses and executives from advanced economies. Most emerging market economies have attained their importance within the global economy through sustained government effort and distinctive policies aimed at promoting growth and development. For an organization, operating in emerging markets involves identifying, investing in, and managing business opportunities in such markets. While the business environment in emerging markets is increasingly moving in the direction of norms in advanced economies, there are fundamental differences that business executives and managers have to address when managing business in emerging markets. These include adjustments to the host countries' macroeconomic structure, control of financial and currency exposure, management of business-government relations, dealing with inadequacies in infrastructure, and the handling of thorny issues of business ethics, intellectual property right protection, and workers' rights and working environment(İbrahim,2008). Effective management in emerging markets requires a conscientious understanding of the often opaque set of conditions in the host country, proactive attitudes toward the opportunities and challenges, and long-term strategies and enduring efforts.
Nowadays, many international organization increasingly regard competing successfully in emerging markets as key to their corporate strategy. It is admitted that Identifying the opportunity these markets represent, however, is the easy mission. The much more difficult task is determining what it takes to sustain profitable growth in these markets. That is why setting and executing the right strategies for profitable growth in these markets is so critical. Thus, this paper identifies and analyzes strategic initiatives that global managers and executives must take into account in emerging markets before action.
3.1 Identification Emerging Market Opportunities识别新兴市场的机会
Companies in the world are increasingly looking to emerging markets like China as a vital source of growth. The problem is these companies often lack an effective strategy for identifying which countries to do business with. In a June Harvard Business Review article, excerpted here, the authors, Tarun and Krishna(2005) present a "five contexts framework"—issues to consider, in essence—to understand institutional variations between countries. We excerpt a summary of the five contexts. They helped companies think through their globalization strategies, developed a simple conceptual device—the five contexts framework—that lets executives map the institutional contexts of any country. These companies buy inputs in the product, labor, and capital markets and sell their outputs in the products (raw materials and finished goods) or services market. When choosing strategies, therefore, executives need to figure out how the product, labor, and capital markets work—and don't work—in their target countries emerging markets. This framework will help them understand the differences between home markets and those in oversea emerging market. In addition, each country's social and political milieu—as well as the manner in which it has opened up to the outside world—shapes those markets, and companies must consider those factors, too.#p#分页标题#e#
The five contexts framework places a superstructure of key markets on a base of sociopolitical choices, also creates a map of each country's context and to gauge the extent to which businesses must adapt their strategies to each one. According to the framework, there are five contexts including political and social systems, openness, product markets, labor markets and capital markets.
(1) Political and social systems.Every country's political system affects its product, labor, and capital markets. In socialist societies like China, for instance, workers cannot form independent trade unions in the labor market, which affects wage levels. A country's social environment is also important. In South Africa, for example, the government's support for the transfer of assets to the historically disenfranchised native African community—a laudable social objective—has affected the development of the capital market(Jeremy, 2005). Such transfers usually price assets in an arbitrary fashion, which makes it hard for multinationals to figure out the value of South African companies and affects their assessments of potential partners.
(2) Openness. The more open a country's economy, the more likely it is that global intermediaries will be allowed to operate there. Multinationals, therefore, will find it easier to function in markets that are more open because they can use the services of both the global and local intermediaries(Raj and Sitabhra, 2008). However, Openness could be a double-edged sword.a government that allows local companies to access the global capital market neutralizes one of foreign companies' key advantages.
(3) Product Markets, labor markets and capital markets. These three contexts have become the consequently factors that must be considered and investgated. Because in developing countries the market research and advertising are in their infancy, and it's difficult to find the deep databases on consumption patterns that allow companies to segment consumers in more-developed markets((Eric, 2008)). In spite of emerging markets' large populations, however, multinationals have some troubles recruiting managers and other skilled workers because the quality of talent is hard to ascertain. Moreover, the capital and financial markets in developing countries are remarkable for their lack of sophistication. Apart from a few stock exchanges and government-appointed regulators, there aren't many reliable intermediaries like credit-rating agencies, investment analysts, merchant bankers, or venture capital firms.
Therefore, for managers and executives, it is necessary to reflect and identify the target market whether the emerging market is a suitable investing destination.
3.2 Management管理
Over the years, far too many international firms simply make minor adjustments to existing products, reduce prices, and replicate existing distribution channels in the emerging market. But it is proved that this strategy just won’t work gor the long-term.#p#分页标题#e#
From the lessions of many competitive operational strategies, it has learned is that to achieve sustainable commercial success in emerging markets, global organization must instead embrace a strategy based around innovation. This means that the stategies practiced in the emerging market must essentially acquire an entirely new set of skills and organizational structures that addresses the special requirements of both consumer and industrial buyers in these markets. In this part, two citical strategies have been reviewed while doing business in emerging market.
(1) Rethinking value---products and price反思的价值---产品和价格
Customers in emerging markets are becoming more sophisticated and demanding, expecting products that satisfy their special requirements and preferences. So for the international firms, serving the majority of emerging market consumers and industrial buyers will often require manufacturers to design special products tailored to the special needs of emerging market customers, often priced far below their offerings in developed markets(Vasilis and Graham, 2008). The competition to develop special products and services that meet those needs, by firms both from developed and from emerging economies, is now fierce. The drive to rethink product offerings holds the promise of yielding potentially“disruptive”innovations that create new markets by addressing the needs of customers not being served effectively.
Successful companies have realized that they need to customize existing products or design new products that appeal to local tastes and requirements. The Dutch manufacturer Royal Philips Electronics (“Philips”) is a good example of a company that has taken this philosophy to heart(Philips, 2005). Since electric power in emerging markets is often unreliable, Philips employed technologies originally developed to extend the life of torches for rural villagers to build lights that stay powered for several hours even if the main power fails. They have also manufactured lights that can withstand the power fluctuations that are common in India and other emerging markets. By understanding the unique environment and buyer needs in emerging markets, manufacturers often find they need to tailor their special products in the target emerging matkets. Mahindra & Mahindra, the Indian automaker, has created vehicles with stronger suspensions to withstand the poor roads in the country. The company has found that these products also have a market in other countries with poor infrastructure, such as some countries in Africa. In competing for the Indian market, the auto manufacturer, Hyundai Motor Company Ltd. Of South Korea, adjusted its design so that women wearing traditional Indian dresses could get in and out of the car easily.
The price is a problem in the emerging market. Because the countries cataloged into the emerging market usually have lower-income and middle-income consumers. Although their aggregate buying power is enormous, the GDP per capita in most emerging markets is far below that in developed markets. While per capita GDP in 2004 using purchasing power parity was roughly US$39,800 in the United States, it was US$7,940 for Brazil, US$5,890 for China, and US$3,120 for India(Jeremy, 2005;Ross and Ian, 2007). Most products sold in developed markets are simply beyond the means of all but the most affluent emerging market customers. Thus, for the international firms it usually offer unique products at dramatically lower prices to match the special needs and lower purchasing power of most emerging market buyers.#p#分页标题#e#
(2) Recruitment and delection strategy in multicultural workforce多元文化的决定策略
In emerging market, compared with advanced economies, there are mostly labor abundant and enjoy advantages in labor-intensive products. One of the major motivations of foreign investment in emerging markets is to take advantage of the low labor cost and engaged in labor-intensive manufacturing. Managing relations with local employees is crucial to the productivity and sustainability of operations in emerging markets. Workers in many emerging markets appear to be less demanding in terms of compensation, working environment, and workers’ rights. Labor laws are either incomplete or inadequately enforced in some emerging markets. Managers should not take this for granted, for those who maintain high welfare standards for their employees will stand out among competitors in the long run. Local firms in emerging markets often look up to foreign operations for examples of management of relationships with employees. Successful companies have brought their home country practices to emerging markets and are rewarded for employee satisfaction and productivity improvement.
However, on the other side, although seen as an inexhaustible supply of low-cost labor, it is usually face the fact that there are a problem to lack of skilled labor that are all too familiar in developed countries. And in fast-growing emerging markets, the need to rapidly recruit and develop skilled employees is all the more critical. Thus manufacturing executives will need to rethink how they recruit, develop, deploy, and connect the skilled employees on whom they rely. Companies are competing for the best talent by offering higher salaries, increased benefits, and more opportunities for professional development. Global firms should rethink that they need to balance the efficiency afforded by their company-wide human resource policies with the need to accommodate local expectations and cultural norms. These local variations can range from providing more holidays and sick leave in Russia and Eastern Europe to adding softer, less quantifiable factors to performance evaluations in India.
4 Case study---Nokia in emerging market案例分析，诺基亚的新兴市场
When you ask people including the person in the emerging market what there favourite phone brand is, many respond "Nokia". Indeed most phone owners have owned a Nokia in the past. Some users are tempted by other manufacturers phones such as Motorola, but many find that the quality of build and usability is lacking when compared with Nokia models.
Look back to the histroy of Nokia, after the strategic change of 1992, Nokia saw a huge increase in sales to North America, South America and Asia. In 1998, Nokia becomes the world’s biggest mobile phone manufacturer. Between 1996 and 2001, Nokia’s turnover increased almost fivefold from EUR 6.5 billion to EUR 31 billion. Therefore, it is said that 1990s also saw unparalleled growth in global market for Nokia(Jussi, 2007).#p#分页标题#e#
Specifically for emerging markets, Nokia’s created a set of phones such as the launched seven handsets(News, 2007). For example, The dual-band GSM Nokia 1200 and 1208 are designed a "dust resistant" keyboard, and some designed to make it easy for the customers to be shared by families. In many emerging market, many villages do not have access to basic telephony, then Nokia helps bring mobile connectivity to these areas through the “wireless village” approach. This approach builds on entrepreneurship, avoids massive roll-out costs and investments on the part of network operators, and is affordable for low-income consumers. However, in many emerging markets, lower income consumers face financial barriers that make it impossible to own a mobile phone. But there is one way to increase opportunities for connectivity for these important entry-level consumers – phone sharing. Thus the Nokia practice the price war with its competitors liking Motorola, LG, Samsung and Sony. For instance, in China, Nokia has increased quarterly sales of mobile phones by 40 per cent over the past year, almost twice its average global growth rate, according to CEO Olli-Pekka Kallasvuo. Partly as a result of its strength in price-conscious emerging markets, Nokia has the lowest average prices among the world's five major mobile phone makers, according to estimates from Tokyo-based Nomura Securities. Nokia's average handset price fell below $120 in the most recent quarter, compared to prices of more than $130 for Motorola and LG's products, and around $180 for Samsung and Sony-Ericsson(Jussi, 2007).
From this example, in emerging market such as China and India, Nokia have present a good case study for the firms which want to expand their business into the emerging market. It is suggested that firms should first research the market characteristics and the economic development situation, then establish some competitive operational strategies according the emerging market before entrying it.
5 Conclusion结论
To summary, compared with the global developed market, emerging market for economic growth, sourcing, and outsourcing, best-of-breed strategy and execution in these markets have become crucial to global business success. These markets play the same importance for the increasing global international companies. So how to achieve a sustainable development in these emerging market become a hot topic in today`s global business environment. This paper have introduced the concept of this market and offer some citical considerations and strategies while entrying emerging market. It is suggested that a minute identifications of emerging market situation including the political and social system, openness, product markets, labor markets and capital markets become the first important step, and the second step is planning an operational strategies which could improve the goals of firms and maintain the sustainable development in the emerging market. Therefore, as executives or leaders for a international organization, the strategies worked effectively in developed market is not mean that will work in the emerging market, some necessary modifies should be employed before taking into practice.#p#分页标题#e#
In a word, please remember the saying that “look before you leap”, when you plan to entry the emerging market.
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