In order for Matsushita to succeed in displacing Philips in the consumer electronics company, the company also had to engage in becoming a multinational enterprise, and this was achieved in 1960 when Matsushita “opened their first overseas brand in America,” (Bartlett, 2009). This coincided with the birth and rise of the VCR which Matsushita began producing in plants, and as other companies, including Philips outsourced to them, which in turn, boosted their popularity. Strategies that Matsushita executed to differentiate themselves from their competition included a broad product portfolio, a centralised structure, and human resource management.
Matsushita’s initial rise to success was due to their broad product portfolio, a strategy suggested that “instead of a single standardised product, they recommend…many product varieties, so that
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By 1960, Matsushita’s product line ranged from TV sets to electric ovens and this broad product line ensured a constant stream of sales for the company. In addition, market sales became glaringly obvious for Matsushita, and were able to adapt to the trends of the market, and due to this, Matsushita were able to quickly create and market similar existing products. Ironically, Matsushita were also the first Japanese company to adopt a divisional structure, generating internal competition between each division that was to yield new, innovative products. However, Matsushita were also aware of market differences between the different countries they operated in, and they combated this by implementing ‘Operation Localization’, a method of multinational flexbility (Kogut and Kulatilaka, 1994). Operation Localization was effective as it replaced managers in key positions with local nationals who understood the market better than their
Nevertheless, it must “defend” its current market share if not increase it, by maintaining premium quality and develop innovative products. The marketing mix strategies will effectively achieve targeted revenue and profitability in the near future.
The company is also leading the way in innovativeness and has already received recognition for introducing innovative products. This is one of the strengths of the company since innovative products will help to differentiate its products from the other competitor products as well as the new products can be exclusively branded as compared to the other flagship products from older Soviet times.
Each country has its own culture, with subcultures inside the dominant culture (Schaefer, 2009, p.69). “Culture is the totality of learned, socially transmitted custom, knowledge, material objects, and behavior” (Schaefer, 2009, p.57). Values, artifacts, and ideas are also part of culture (p57). With globalization there is the integration of these cultural aspects, as well as language, social movements, and ideas throughout the world (Schaefer, 2009, p.20). Internationalization helps with this integration. Internationalization is the process of planning and implementing products and services so that they can easily be adapted to specific local languages and cultures (Linfo, 2006). Numerous American retail firms have expanded to other countries. Many have been quite successful due to their internationalization. However, failure to study the culture, retail practices, and consumer market of the country they intend to expand to can be quite costly. Although Home Depot is one of the world’s largest home improvement stores, their expansion to Chile cost them enormous financial loss, resulting in their divestment (Bianchi & Ostale, 2006, section 1, para3). This paper will look at successful international expansion of Home Depot stores, analyze what mistakes were made in Chile, and make suggestions of what could have been done differently.
Thus new products/line extensions will be based on Allround brand, each one with a unique target market, delivering different value proposition to the respective customer.
The German and Chinese business hierarchies don’t only affect the way businesses are run but also affects what kind of products each country is able to specialize in. The lack of empowerment and innovation within the Chinese business structure makes it very hard for them to come up with new products and processes. However, having an obedient workforce allows them to excel at creating low cost, less complex, mass market products. The Germans focus on efficiency and technical knowledge helps them to successfully produce more complex products, but are seldom the first to market due to their low innovation and empowerment.
Thus began a long period of imitation, manufacturing products that were invented elsewhere. Sharp operated in industries in which products were easy to imitate and followed a dominant design. In addition to making refrigerators, washing machines, and air conditioners, Sharp also manufactured televisions licensed from RCA and microwaves licensed from Litton. Though Hayakawa promoted innovation, “the company remained primarily an assembler” of consumer goods (Noda 2). Sharp’s relatively small size and limited capital prevented it from developing a vertically integrated business and forced it to contract with other companies for significant portions of the value chain. This meant that it could not maintain control over its intelle...
Two new managers have been appointed at Sony in the last 15 years due to a number of developing problems, including the innovation ‘cogs’ within Sony slowing down, being forced into an aggressive pricing strategy, increased competition, losing the battle of VHS and Betamax, profit and sales remaining flat and the ongoing poor performance of Sony films (Mintzberg et al, 2003). Both managers initiated major strategic changes with varying degrees of success; firstly Nobuyuki Idei was appointed and initiated a major shift from analogue to digital technology, as there was a belief that Sony was falling behind the market in this respect. Idei also targeted the top position in the audio and visual industry, a universal standard in home computer devices and a new distribution infrastructure. He believed his job was the ‘regeneration of the entrepreneurial spirit’ (Mintzberg et al, 2003), believing it had been lost.
Hunsk Engines is a motorcycle company that made the fatal mistake of expanding its research in the market on its new products. The companies main competitors were companies like Harley Davidson, where they sold classic products that were seen as something with altering respect. Marty Echt is hired on by Hunsk Engines to restore the company’s image, on what used to be classic motorcycles. He argues that the company made the mistake of forgetting about its original products and, “lost its identity”. This problem frequently happens when companies attempt to grow, in order for new products to make it in the market place you have to carefully strategize its competitive characteristics and know when to introduce a new product through Michael Porters life cycle.
Internationalization Phase, during this phase Chinese companies focused on ‘building brand, localization of products and services for new markets, and differentiation of products to support higher margins’ they did what was ‘good enough’ for the market (Teagarden & Cai, 2009:78). An important issue during this phase was to research and develop the products, and to keep the key talent of the company, such as managers and engineers.
For over fifty years, Toyota has established over 50 bases in 26 different countries and regions. Their automobiles have found their way into over 170 countries across the entire globe. In addition, Toyota has design and R&D bases in nine locations overseas, with this they prove that they have achieved consistent globalization as well as localization. The most important part in any Toyota base is the quality assurance. They don’t stamp their product with “Made in the USA” or “Made in Japan”, but instead opt for one label for all: “Made by TOYOTA.” This shows that the product is made in the “Toyota Way.” To achieve this, the company minimized support that comes from Japan to let each of their foreign locations become self-reliant. For example, a Toyota plant recently began production in Texas has made maximum use of its sibling’s experience in Kentucky which has been cultivated over the past 20 years. Toyota believes that in order to reach their goals is through educating people. Multiple Global Production Centers have been built within Motomachi Plant in Toyota City, in United States, the United Kingdom, and Thailand to carry our corresponding activities in the Asia-Pacific, European, and North American regions. To promote the “Toyota Way”, the Toyota Institute established an internal human resources development organization in North America, Europe, Asia, Africa and Oceania. As you can see the pros of the globalization of Toyota are endless. This company alone has created millions of jobs across the world. Winners are not only the workers, but also the buyers, without globalization Toyota automobiles would only be available in Japan. Many people, including me, see globalization of this kind as a beneficial and advantageous result. Toyota companies have not only created jobs for thousands if not millions of people, but their
Firstly, Philips’ main capability is the decentralised structure with strong local subsdiaries, which is the National Organisations (NOs). Philips established NO after the war to replace the destroyed industrial plant in Netherlands. During this period, electronics was seen as luxury good and trade barrier between nations was high. The decentralised structure supports Philips in competing effectively with local competitors and enables them to adapt with the diverse local market. Each NO had the their strength and resources to sense and perform adaptive marketing as well as develop their product to respond the local differences. It is reflected in its television product. The first color TV is created in Canada, while the first stereo TV is created in Australia and the teletext TV is created in UK (Bartlett, C. A., 2001). The strong independence of these local subsidiaries also reinforced by the communication barriers during that period (Bartlett, C. A., Ghoshal, S., & Birkinshaw, J. M., 1995). The decentralised structure gives high degree of independence in each international unit, including decision-making autonomy (Daft, R. L., 2009). In the case of Philips, NOs as local subsidiaries had more power over the Product Departements (PD), as Philips gave NOs financial autonomy as well as liberty to set their own target. Thus, the NOs ability of autonomous marketing and product development function had become Philips m...
During the 1990s, Japan has been exposed to one of the most difficult structural transition periods in its post-war history, in terms of social and economic conditions. There have been two major changes: one is a substantial decline in economic growth in real terms, and the other is a changing social structure characterized by the declining birth rate and the ageing population. Under the pressure of changes in the economic environment caused by globalization and innovations in information technology, Japanese business corporations are forced to adapt to the new situation. While companies faced with fierce international competition, it became more critical to understand the basic knowledge of complicated legal, cultural, economic, and social issues. Engaging in international trade also requires attention to international regulations, international business planning, international market research, funding, distribution and other areas that must be considered separately from domestic business issues. The paper suggests some of the basic tools that can apply to solve the problem or to bring the business opportunity to fruition in today's Japanese business environment
The market-oriented structure groups workers according to the market they serve, such as product, project, client, or geographical area. Large companies that implement a market-oriented structure may have market-based divisions or create a conglomerate of separate subsidiaries (Judith R. Gordon, 2002). I believe that this structure is more adoptable by those multinational corporations which have to respond to diverse cultures and meet the unique needs of various countries. The teams have the same goal meeting the market demands.
GM- focused differentiation, medium pricing, breadth of product line is high. A strength is market share, and a weakness is styling and reliability and perceived quality.
Currently in the global environment, there is a strong sense of competition that must be achieved through better performance, almost all firms are competing in international markets due to the reduction in barriers for capital and tariffs. With the new changes in both communication and technology, the consequences faced are that production processes are no longer within national boundaries but spread across (Debrah & Smith, 2002).