Globalization presents risk and opportunities today and in the future. Transnational Organizations (TNOs) were the beneficiaries of the globalization; they expanded their activities aboard, created an international mentality and adapted their strategies for substantial growths. Many domestic markets of TNOs are already saturated and through the process of expanding abroad TNOs have been looking for new markets with a high growth potential. Nowadays, China represents a promising target for nearly every TNO. However, many TNOs fail to enter the Chinese market successfully or are not able to capitalize their potential.
The purpose of this report is to conclude why China is attractive for TNOs, what the specific risks and challenges are, when operating in the Chinese market and on which aspects a TNO should focus when entering China.
In order to answer these questions, the present economic situation, including the influences by the economic crisis, is analysed to demonstrate the relevance of the Chinese market. The current situation of TNOs in China is explored to provide an understanding of the different strategies to cope with the various challenges and risks in China. As a result an outline of the key success factors and most relevant strategic decision will give advice for the implementation of an efficient strategy.
Transnational organizations have to target the Chinese market in order to remain competitive in the process of globalization. Poor infrastructures, different cultural behavior, copyright violations, fierce competition or concerns on the legal systems are risks that TNOs have to face in China. Therefore, transnational organizations need to implement efficient strategies in order to exploit their full potential in the Chinese market.
Entering the Chinese market can be done by four major entry modes: Exporting, Licensing (Franchising), Joint Ventures or Foreign Direct Investment.
It can be concluded that TNOs have to focus on an efficient innovation strategy and incorporate local responsiveness in their culture in order to adapt their company to the market environment of China. One global strategy for all countries, as in the past, is not possible anymore. TNOs have to implement a “Think Global – Act Local” strategy. The prospects for the Chinese economy are still promising and will continue to offer TNOs enormous competitive advantages.
Inhaltsverzeichnis (Table of Contents)
- Motivation for Research
- Introduction
- Purpose
- Problem Statement and Research Questions
- Research Method
- Structure of the Report
- Economic Climate & Forecast
- Economic Climate
- The Chinese Economy
- Forecast of the Chinese Economic Development
- Role & Importance of Transnational Organizations
- Definition and Characteristics of a TNO
- Transnational Organizations in China
- An Efficient Strategy for the Chinese Market
- Approaches for a Market Entry
- Relevance for the Chinese Market
- Innovation Strategy
- Relevance for the Chinese Market
- Realization of a Winning Innovation Strategy
- Threats of Doing Business in China
- General Risks & Threats
- Business Risks & Threats in China
- Conclusions
- Bibliography
- List of Figures
- List of Tables
- Appendices
- Appendix 1: 360 Degree Analysis
- Appendix 2: Economic Overview China
Zielsetzung und Themenschwerpunkte (Objectives and Key Themes)
This report aims to investigate why China is attractive for transnational organizations (TNOs), the specific risks and challenges of operating in the Chinese market, and the key aspects TNOs should focus on when entering the country. The study analyzes the current economic situation in China, including the impact of the global economic crisis, and explores the strategies TNOs utilize to navigate the unique challenges of the Chinese market. The report then provides an overview of key success factors and strategic decisions that can help TNOs implement an effective strategy for entering and thriving in the Chinese market.
- The attractiveness of the Chinese market for TNOs
- Risks and challenges associated with operating in China
- Strategies for TNOs to successfully enter and operate in the Chinese market
- The importance of innovation strategy and local responsiveness
- The "Think Global - Act Local" approach for TNOs in China
Zusammenfassung der Kapitel (Chapter Summaries)
The report begins by exploring the motivation for research and introducing the purpose, research questions, and methodology employed. It then analyzes the economic climate and forecasts for the Chinese market, highlighting the country's economic potential and the implications of the global economic crisis. The role and importance of transnational organizations are examined, with particular focus on their presence and strategies in China. The report further delves into the development of an effective strategy for TNOs entering the Chinese market, considering various approaches for market entry, the relevance of innovation strategy, and the importance of local responsiveness. Finally, the report addresses the threats and risks associated with doing business in China, including general risks and those specific to the Chinese market.
Schlüsselwörter (Keywords)
This report focuses on key concepts such as transnational organizations, market entry strategies, Chinese market dynamics, economic climate, innovation strategy, local responsiveness, risks and threats, and the “Think Global - Act Local” approach. The research aims to provide a comprehensive understanding of the challenges and opportunities for TNOs seeking to establish a presence in the rapidly growing Chinese market.
- Citation du texte
- Simon Hecker (Auteur), 2008, Entering China - Which aspects should a transnational organization consider when entering the Chinese market, Munich, GRIN Verlag, https://www.grin.com/document/180579
