Article Summary: Emerging Giants
Many local companies lost their market shares or sold off their businesses when global or multinational companies from developed markets such as US, Germany, and Japan got into the emerging markets. However, some local companies held out against and exorcised multinationals. In this article, the authors instantiate this kind of local companies by explaining that Mahindra & Mahindra in India and Haier Group in China have barraged out their own rivals, reset their business strategies, taken advantages of new opportunities, and gained high competencies that enable themselves to do their businesses in global markets very successfully. Also, the authors describe the three strategies these companies employ to make themselves strong, global competitors in spite of facing several difficulties such as financial problems or bureaucratic disadvantages in their home countries, referring the results of their study of emerging giants. First of all, some emerging-market companies use their own knowledge of local product markets, resulting in good understandings of local customers’ needs and tastes. This strategy helps these local companies to capture distinctive national advantages. For example, Jollibee Foods in Philippine has profitably succeeded in their businesses against McDonald’s because they know local customers tend to prefer a particular soy and garlic taste that their products have. Secondly, some companies in emerging markets have exploited their knowledge of local talent and capital markets, thus giving services to their customers at home countries and overseas cost-effectively. For instance, Infosys or Wipro in India knew the possibility of providing services to customers abroad very cheaply compared to Western companies did because they had knowledge about where the talents resided and that they can hired technical workers at salaries lower than those in developed markets. Finally, some emerging giants have taken...
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