[8] 2002 e-business-strategies-for-virtual-organizations
[8] 2002 e-business-strategies-for-virtual-organizations
[8] 2002 e-business-strategies-for-virtual-organizations
Create successful ePaper yourself
Turn your PDF publications into a flip-book with our unique Google optimized e-Paper software.
Four stages<br />
of market<br />
evolution<br />
Market structure<br />
Regulations Minimal regulatory<br />
freedom<br />
� Strict controls on<br />
ownership/capital<br />
repatriation<br />
� Strict regulatory<br />
oversight<br />
Transparency Unfamiliar to outsiders<br />
� Outpost mentality<br />
Alliance focus<br />
Global players Market skimming<br />
� Limited involvement<br />
� Technology licensing<br />
distribution<br />
agreements<br />
Local players Local game, local<br />
players<br />
Characteristics<br />
of alliance<br />
environment<br />
Low profile, nonequity-based<br />
collaborations<br />
Figure 11.2<br />
Evolution of market alliance<br />
Creating <strong>virtual</strong> cultures <strong>for</strong> global online communities<br />
burgeoning global economy. Alliances can seem the obvious<br />
solution <strong>for</strong> both sides. Yet alliances between global and<br />
emerging market players are hard to get right, and often highly<br />
unstable. Many have failed to meet expectations, required<br />
extensive restructuring, or been bought out by one of the<br />
partners. Differences of size, ownership structure, objectives,<br />
culture, and management style can all prove stumbling blocks.<br />
Alliances also need to recognize that there are four stages of<br />
market evolution and each stage of this will be driven by each<br />
partner’s shared strengths and weaknesses and by the relative<br />
importance of each contribution in shifting the balance of power<br />
(Figure 11.2).<br />
Regulations relaxed<br />
� Near majority or<br />
majority <strong>for</strong>eign<br />
stake allowed<br />
� Operating<br />
restrictions still exist<br />
(e.g. bureaucratic<br />
approvals<br />
Many global players<br />
present<br />
Few can replicate local<br />
market knowledge and<br />
government<br />
relationships<br />
Market access<br />
� Build options<br />
� Understand local<br />
market<br />
� Influence<br />
government<br />
Upgrade capabilities<br />
� Products<br />
� Technology<br />
� Capital<br />
Provide ‘escort’ service<br />
Rapid <strong>for</strong>mation of<br />
many joint ventures<br />
Regulations liberalized<br />
� Fully owned<br />
subsidiaries<br />
� Operating controls<br />
eased<br />
� Market <strong>for</strong> corporate<br />
control emerges<br />
Many global players<br />
present<br />
Many global players<br />
have ‘insider’<br />
knowledge<br />
Market growth<br />
� Prune options<br />
� Invest in winners<br />
Survival of fittest<br />
� Restructuring<br />
� Players without longterm<br />
advantage<br />
Dissolution of joint<br />
ventures, emergence<br />
of cross-border M & A,<br />
fully owned<br />
subsidiaries<br />
Examples Brazil (Telecom) China India UK<br />
Market deregulated<br />
� Free equity and<br />
capital flows<br />
� Operating freedom<br />
corporate control<br />
� Shareholder<br />
orientation<br />
Market integrated with<br />
global markets<br />
Market integration<br />
� Optimize global<br />
<strong>business</strong> system<br />
(e.g. by outsourcing)<br />
� Improve<br />
per<strong>for</strong>mance<br />
� New opportunities<br />
Genuine alliances<br />
� New markets<br />
� New products<br />
Full set of vehicles<br />
exist<br />
243