What Kind Of Global Thinking Mode Should Chinese Enterprises Have?

Gupta K. INSEAD is a professor of strategic studies. Professor Gupta is well known for his global strategy and has a strong attainments for strategy, globalization and innovation and entrepreneurship. He is a consultant and director in the United States, Europe and Asia.

"I am not very optimistic about Geely and Volvo's M & A pactions.

HUAWEI is a relatively successful example of Chinese companies in globalization, followed by Haier. But if I were to give it a suggestion at the beginning of Haier's globalization, I would not recommend that it choose the European and American markets at the very beginning and should choose new markets such as India.

But there is still time for them to "attack" emerging markets.

But if we don't seize the next ten years, Haier's Chinese companies are bound to decline.

In an interview with business school magazine, Professor K. Anil K. Gupta talked about the globalization strategy, tactics and lessons of Chinese enterprises in Anil.

Globalization is a double-edged sword. Opportunity and risk coexist.

Is it a good time for globalization to be a Chinese enterprise that is complacent and eager to "copy the bottom" overseas? Can foreign companies be purchased to achieve globalization? How should Chinese enterprises prepare for globalization and global competition?

Conceptual change and technological revolution are making globalization one of the most important problems facing companies today.

"In this new era, every industry should be regarded as a global industry, and every enterprise should be regarded as a knowledge-based enterprise."

Professor Gupta said, "nowadays, even for the smallest companies, globalization is no longer a dispensable but necessary strategy."

In Gupta's classroom, more students will equate the globalization of the market with the globalization of the company.

Gupta said that the concept of corporate globalization should be a four-dimensional model. Its premise is that enterprises have more or less the following four main characteristics of Globalization: globalization of market share, globalization of supply chain, globalization of capital base and globalization of collective thinking.

Professor Gupta further described the connotation of these four dimensions.

"Globalization of market share refers to the number of customers targeting the industry in the world's major markets.

The globalization of supply chain refers to how many best locations a company can use to improve the performance of various businesses in the supply chain.

It is entirely possible for the company to gain a fairly localized or regionalized layout and at the same time to have a fairly global value chain.

How much capital has been developed and utilized globally is the best source of capital, namely the globalization of capital base.

Any enterprise

"Global expansion forces companies to develop at least three abilities: the ability to recognize foreign markets, the ability to manage foreign employees, and the ability to manage foreign subsidiaries.

If these three abilities are not available, the company may be unacclimatized, and global expansion will lead to high risk.

Professor Gupta reminded.

Globalization experience of Chinese Enterprises

"Not only Chinese enterprises, but many enterprises in the world think that it is globalisation to buy an overseas company."

Gupta said, "this is just a step in the global layout, which does not mean that we have global competitive advantage.

Of course, entering a strategically important market is a prerequisite for global competitive advantage. "

In Gupta's view, HUAWEI is the best performing company in China, followed by Haier.

But Volvo's recent dealings with Geely are not optimistic.

"I think Geely's ability to increase its market share worldwide is very small.

If Ford can't get a share in global growth, how can Geely do that? If your merger does not make you more efficient, technically stronger, and better image.

Why should such mergers and acquisitions be done? "Gupta said.

"The globalization of HUAWEI is more successful and more competitive.

This is not only the advantage that it uses China's low production price, but also the technical advantage of developing hardware in China and the technical advantage of doing software R & D in India.

The leading technology makes it very competitive.

Besides, its service is also good.

Many markets in the world have their products. "

Gupta agreed with HUAWEI. "At the same time, when it first became globalized, it chose to start with emerging markets and then enter developed markets.

If Haier had chosen to enter the overseas market in such a way, its sales in the world would be larger than that of today.

In the next 10 years, the 5 most powerful emerging markets outside China must exceed the capacity of the European and American markets for the home appliance market.

By 2020, emerging markets will exceed the capacity of developed markets.

Haier concentrated in the European and American markets and gave the India market to Samsung and LG.

Gupta K. INSEAD as a professor of strategic studies.

Professor Gupta enjoys a world-wide reputation in the field of strategy, globalization and innovation and entrepreneurship.

He serves as a consultant and director in companies in the US, Europe and Asia.

"I am not very optimistic about Geely and Volvo's M & A pactions.

HUAWEI is a relatively successful example of Chinese companies in globalization, followed by Haier. But if I were to give it a suggestion at the beginning of Haier's globalization, I would not recommend that it choose the European and American markets at the very beginning and should choose new markets such as India.

But there is still time for them to "attack" emerging markets.

But if we don't seize the next ten years, Haier's Chinese companies are bound to decline.

In an interview with business school magazine, Professor K. Anil K. Gupta talked about the globalization strategy, tactics and lessons of Chinese enterprises in Anil.

Globalization is a double-edged sword. Opportunity and risk coexist.

Is it a good time for globalization to be a Chinese enterprise that is complacent and eager to "copy the bottom" overseas? Can foreign companies be purchased to achieve globalization? How should Chinese enterprises prepare for globalization and global competition?

Market globalization and enterprise globalization

Conceptual change and technological revolution are making globalization one of the most important problems facing companies today.

"In this new era, every industry should be regarded as a global industry, and every enterprise should be regarded as a knowledge-based enterprise."

Professor Gupta said, "nowadays, even for the smallest companies, globalization is no longer a dispensable but necessary strategy."

In Gupta's classroom, more students will equate the globalization of the market with the globalization of the company.

Gupta said that the concept of corporate globalization should be a four-dimensional model. Its premise is that enterprises have more or less the following four main characteristics of Globalization: globalization of market share, globalization of supply chain, globalization of capital base and globalization of collective thinking.

Professor Gupta further described the connotation of these four dimensions.

"Globalization of market share refers to the number of customers targeting the industry in the world's major markets.

The globalization of supply chain refers to how many best locations a company can use to improve the performance of various businesses in the supply chain.

It is entirely possible for the company to gain a fairly localized or regionalized layout and at the same time to have a fairly global value chain.

How much capital has been developed and utilized globally is the best source of capital, namely the globalization of capital base.

The collective way of thinking of any enterprise depends on two factors: one is the way of thinking that leads the enterprise, and the two is the organization that determines how these individuals interact, collect information, how to deal with the information and how to make decisions.

The globalization of the way of thinking refers to the ability of a company as a collective to understand the diversity of culture and market and how to integrate it with this diversity.

"Global expansion forces companies to develop at least three abilities: the ability to recognize foreign markets, the ability to manage foreign employees, and the ability to manage foreign subsidiaries.

If these three abilities are not available, the company may be unacclimatized, and global expansion will lead to high risk.

Professor Gupta reminded.

Globalization experience of Chinese Enterprises

"Not only Chinese enterprises, but many enterprises in the world think that it is globalisation to buy an overseas company."

Gupta said, "this is just a step in the global layout, which does not mean that we have global competitive advantage.

Of course, entering a strategically important market is a prerequisite for global competitive advantage. "

In Gupta's view, HUAWEI is the best performing company in China, followed by Haier.

But Volvo's recent dealings with Geely are not optimistic.

"I think Geely's ability to increase its market share worldwide is very small.

If Ford can't get a share in global growth, how can Geely do that? If your merger does not make you more efficient, technically stronger, and better image.

Why should such mergers and acquisitions be done? "Gupta said.

"HUAWEI's globalization is more successful and competitive.

Not only did it take advantage of the low price in China, but also made use of the technological advantages of hardware research and development in China and the technological advantages of developing software in India.

The leading technology makes it very competitive.

Besides, its service is also good.

Many markets in the world have their products. "

Gupta agreed with HUAWEI. "At the same time, when it first became globalized, it chose to start with emerging markets and then enter developed markets.

If Haier had chosen to enter the overseas market in such a way, its sales in the world would be larger than that of today.

In the next 10 years, the 5 most powerful emerging markets outside China must exceed the capacity of the European and American markets for the home appliance market.

By 2020, emerging markets will exceed the capacity of developed markets.

Haier concentrated in the European and American markets and gave the India market to Samsung and LG.

The need for efficiency

When the minimum economic scale of value chain (R & D, production, etc.) exceeds sales, as long as one or more business activities in the value chain are feasible in a country, the company with global layout has the potential to create cost advantages relative to the domestic competitors of the industry.

Knowledge needs

No two countries are exactly the same.

When a company expands its market share to other countries, it must adjust some characteristics of its products and processes to suit the local environment.

Globalization of customers

This refers not only to those global company customers, but also to those who walk around the world.

When a domestic company's customers begin to globalize, the company must keep pace with them.

These customers will have a strong preference for global consistency and coordination when using products and services.

They also enjoy long-term cooperation with a small number of suppliers.

Globalization of competitors

If your competitors are beginning to globalize and you refuse to move, then you will be vulnerable to attack in the two armies. They will take advantage of the forerunners, expand market share, pursue global scale benefits, use knowledge arbitrage, and provide a coordinated source of supply for global customers. At the same time, they can use cross market share to cross purchase and launch a more aggressive attack in your domestic market.