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CASE NOTES INTEGRATIVE CASE 1 THE CHINESE MENU (FOR DEVELOPMENT) Analysis: China’s emergence as a significant economic power is an excellent basis for discussing what can happen in terms of economic development. You might have a discussion in class as to the extent that economic development can occur in the poorest nations on earth. Answers to Questions: 1. What role do institutions play in economic development? The student should have no problem identifying roles but help them to see that roles could be both positive and negative. Furthermore, the application of that role may vary based on time, culture, and circumstances. 2. What is behind the differences in economic development between North and South America? The student will likely find it easier to explain the differences in terms of institutions rather than resources. While some resources in South America have not been properly developed, the student should be able to explain how that lack of development is most often due to institutions. 3. Some argue that a democratic political system is conducive to economic growth. How does the experience of recent Chinese economic development support or refute this statement? Whether the focus is on all of mainland China (PRC) or Hong Kong that was integrated into the PRC, economic development has occurred in spite of a lack of democracy. On the other hand, Taiwan (ROC) has had a relatively democratic country and has enjoyed economic growth. The student should be challenged in whatever response is given and asked if perhaps other aspects such as culture affect whether democracy is best suited to providing the environment needed for economic growth. 4. If you were a policymaker in a poor country or a World Bank official, what would be your advice, based on North’s article and China’s experience, for the most effective economic development? This is a question in which the answer is not as important as the thought process and the ability to clearly articulate.
INTEGRATIVE CASE 2 TIPS ABOUT CORRUPTION AROUND THE PACIFIC Analysis: The major objectives of the case are: 41
GLOBAL BUSINESS Integrative Case Notes
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To develop an understanding of various types of corruption, as well as the concept of corruption in general To promote discussion of corruption, independent and not independent of its valueladen connotations To illustrate the difficulties of dealing with corruption for the uninformed, using the simple example of the practice of tipping To understand the difficulties and costs that corruption presents to the conduct of business transactions in a country
In this case, we see a radical difference in perceptions and values. Ask your students as to whether those doing business in another nation should be bound the values of that nation or this nation. Try to develop a common ground understanding of the definition of corruption, before moving to its evaluation. Given the sensitivity and emotive content of corruption, students can be vocal and quick to voice conclusions and opinions. Although such enthusiasm can be useful, it is advisable to restrain this discussion until the appropriate groundwork is laid for the discussion. Answers to Questions: 1. What is the definition of corruption? Is tipping in the private sector corruption? Why or why not? The case clearly brings out the reality that the definition of corruption varies in different cultures. Students who might feel that tipping in the private sector is not corruption might want to consider instances in which its purpose it to get an employee to do something for the tipper at the expense of the tipped person’s expense such as information concerning the employers’ plans and strategies. 2. Why do Mr. Lee, Mr. Biswas, and Mr. Lai have such difficulty understanding the practice of tipping? Should it not be second nature to know how to tip? Students should be able to recognize that growing up in one culture may make it difficult to understand the practices of a different culture and that such understanding is not “second nature.” The main problem with tipping and developing an understanding of tipping is the lack of transparency in a country’s rules and regulations surrounding tipping practices. This lack of transparency also accompanies corruption. There is uncertainty about whom to engage in corruption and the level of payment that is appropriate for a given level of services associated with a particular level of corruption; albeit, the scale is somewhat different with tips accounting for 15% or 20% of a meal, which is not the same as 2% or 3% of a $1 million deal. 3. Is what Mr. Biswas does in India corruption? Why or why not? Is what Mr. Lee does in Indonesia corruption? Why or why not? This is a question in which the answer is not as important as the thought process and the ability to clearly articulate. The discussion may center around the fact
GLOBAL BUSINESS Integrative Case Notes
that their respective businesses could not become operational without good support from public sector officials.
INTEGRATIVE CASE 3 DP WORLD Analysis: One of the concerns often raised to oppose trade or international investment, is the national security argument. It is the idea that some activity is so vital to our survival, especially in time of war, that it must be under U.S. control. This case is an example of that concern. Answers to Questions: 1. From a resource-based view, why was DP World interested in acquiring US ports? What advantages did it have or was interested in acquiring? If the students have difficulty answering that question, ask them to consider what was the main business of DP World and to what extend is the U.S. a player in international trade? 2. From an institution-based view, did this acquisition violate any formal laws, rules, and regulations? It is difficult to make a case for formal violation. 3. Also from an institution-based view, what informal rules and norms did this acquisition “violate” that triggered such a strong negative reaction in the United States? The informal “rules and norms” were ones that came about over the past decade and became more potent in the 21st century. Ask the student whether they think that there would have been the same level of objection in the 1980’s and why they feel that way. 4. Did DP World and its American lawyers and other advisors do enough homework? This is a question in which the answer is not as important as the thought process and the ability to clearly articulate. 5. Combining the institution- and resource-based views, what advantages did Eller have that DP did not have? Did Eller’s political strategy make sense? Students will probably point out that Eller had the advantage of not being Middle Eastern and that whether its strategy made sense, it was effecting in killing the DP deal.
almost all in your class will at least see this as related to that which is recent if not current at the moment. most students like to discuss what is happening now. However. explain why certain PMCs outperform others. 44 .GLOBAL BUSINESS Integrative Case Notes 6. The firms recognize that there is a segment of the populace that would quickly seize upon any negative news about the firms in order to curtail their operations thus it is important for them to prevent any events that could damage their image. effectiveness and political concerns. On the other hand. INTEGRATIVE CASE 4 PRIVATE MILITARY COMPANIES: DOGS OF WAR OR PUSSYCATS OF PEACE? Analysis: except for those who are history fans. would you consider buying stock of a PMC such as DynCorp? Why or why not? Do you have any ethical reservations? The response to the financial question about buying stock may be more based on the final part of the question about ethics. some of the students may or may not be aware that many of the employees are ex-military. one of the challenges will be to discuss the questions without whatever bias they may have on Iraq in particular or political economic policies in general. Denmark’s Maersk. Even if the situation in the Middle East changed dramatically and suddenly. As an investor. or Germany’s Eurogate. Why are industry associations such as the IPOA and BAPSC so interested in selfregulation? There are differences in the experience of firms and the capabilities of the employees. beliefs and stand regarding contemporary controversies such as conflicts in the Middle East. From an institution-based view. 2. The ethical issue in the students’ minds will likely be affected by their values. Answers to Questions: 1. Singapore’s PSA. When discussing this in class. From a resource-based standpoint. For example. Students may refer to the trend toward outsourcing is being applied to aspects of military operations and to the protection of clients in dangerous non-military environments. If you were CEO of Hong Kong’s Hutchison Whampoa. explain what is behind the rise of this industry. 3. an operation based in North Korea would likely be rejected outright but one based in South Korea might at least be given some consideration. challenge them to see that being a firm that is located overseas may not always be a problem. what lessons would you draw from this case when entertaining the idea of acquiring US port operations? This should not be a difficult question for students to answer – in the negative. The outsourcing is driven by cost. including former Navy Seals.
You might question the students as to whether they can see any benefit of using government support to help the least efficient farmers to shift into something in which they could be more competitive. Other than suggesting government subsidies of farmers and providing incentives that would shorten the supply chain between farmers and production facilities. what measures should be taken? The price of Chinese soybeans is higher and the quality lower than imports. 3. What difficulties do Chinese soybean farmers face? How can they compete with international producers? Students should easily be able to list difficulties. INTEGRATIVE CASE 5 SOYBEANS IN CHINA Analysis: over time a country’s advantage is some aspect of trade will change. 45 . Ask your students if this case exemplifies that tendency. 2. In China. The chances are that at least some of those who may previously have said “no” might soften their opposition a bit if they really considered the possibility of being in a dangerous situation such as that and they needed a firm with a good track of protecting people in such situations. would you consider hiring security personnel from Blackwater? Students with a negative answer to question number three may sound a very loud “No” to this one since some of them are opposed not only to the Iraq war but also to Big Oil.GLOBAL BUSINESS Integrative Case Notes 4. what is the current crisis of the soybean industry? Do you think the government should or should not intervene? If intervention is called for. Answers to Questions: 1. it may be a bit more difficult to come up with what can be done to compete successfully. students need to set aside their feelings about Iraq and the oil industry in order to answer the question – what would they do if they were in the situation described in the question. Thus to get a thoughtful answer. Does China have an absolute or comparative advantage in soybean production? The case makes it clear that China does not have an absolute advantage. As an oil company executive setting up operations in a political unstable and dangerous country. Rather than adjusting to that change. some in the country may wish to preserve the industry that no longer has an advantage. Opinions may vary as to what could be done. Student opinions may vary as to whether the government should intervene or whether the soybean farmers should shift into producing something different.
It also shows that the imported price has gone but the domestic has also gone up and remains higher than the imported price.S. Will the new labeling standards for non-GM-based soybeans used for edible oil production have any impact on domestic soybeans? This is an opinion question in which students will likely be inclined to answer based on the culture in the U. Perhaps the methods and technology that has worked elsewhere might have a “spill over” effect on local farmers and thus improve quality while reducing costs. and Imports in China. The table shows that over time there has been an increase in planting and output but not in proportion to the increase in consumption. 46 . INTEGRATIVE CASE 6 AGRANA: From a Local Supplier to a Global Player Analysis: reduction of trade barriers and opening up a country to more international trade is viewed by many within the U. From a resource-based view. 2. 5. what can the soybean oil processing companies do to promote locally grown soybeans? Is this their responsibility? This is a question in which the answer is not as important as the thought process and the ability to clearly articulate. Facing the imminent wave of consolidations led by FDI. Consumption.GLOBAL BUSINESS Integrative Case Notes One possibility that you might discuss with the class would be to attract foreign investment into actual operation of the farms. as a threat but the case is an example of how economic integration can provide opportunity for those who are able to leverage their expertise. what is behind AGRANA’s impressive growth? The organizations was especially successful in leveraging expertise in managing expansion of it existing lines of business but in applying that expertise in a new line of business involving fruit. In its expansion it was able to obtain economies of scale that provided it with the competitive capabilities needed for growth. One challenge was to integrate its expanded and operations. From an institution-based view. Table 1 Soybean Production. what opportunities and challenges have been brought by the integration of EU markets in both Western Europe and CEE? Integration of EU markets opened up the opportunity for sales beyond its existing markets and the opportunity to obtain through acquisitions the means of reaching those markets. 6. 4.S. Answers to Questions: 1. Ask them to defend their answer.
GLOBAL BUSINESS Integrative Case Notes 3. regional headquarters) and a subsidiary—even a profitable one—and the implications of this tension for effective subsidiary operations. TEACHING OBJECTIVES The main objective of this case is to better sensitize students to the (operational) tension between headquarters (here. a DHL-Bangladesh (DHLB) manager who must recommend which of the two Human Resource Information Systems (HRIS) DHLB should adopt to alleviate the escalating workload on its Human Resources (HR) department. 47 . From an international perspective. Unlike the EU which has simplified requirements within its area and has a common currency for some of the EU. The choice between these systems is difficult: the HRIS favored by regional headquarters is significantly more expensive and likely unsuited to DHLB’s unique needs whereas the HRIS favored by DHLB—although likely effective—seems to be incapable of meeting headquarters’ strong preference for streamlining human resource systems across disparate Asian subsidiaries. In this last sense. Nurul Rahman. A third objective is to allow students to come to terms with the political reality of working in multinational firms and to develop a personal “moral framework” for resolving dilemmas created by such realities. this is not an easy task given the imperative to balance regional headquarters’ need for efficiency against the subsidiary’s need for effectiveness. A unilateral imposition of wills is likely infeasible to the extent that doing so will have repercussions either on employee morale in a (profitable and fast-growing) subsidiary or invoke the wrath of regional headquarters. operations outside of the EU will be much more complex. what challenges do you foresee AGRANA facing as it continues its expansion into other regions such as East Asia? One challenge is the potential competition and successful operating in a different culture. INTEGRATIVE CASE 7 DHL BANGLADESH CASE SUMMARY AND ISSUES This case revolves around Mr. the case lends itself well to a role play involving various DHL stakeholders. Nurul must carefully balance conflicting stakeholder interests and do so against the backdrop of a politically powerful headquarters that can “make or break” managerial careers. A second objective is to uncover some ways in which such tension can be diffused so as to create a win-win situation for all parties. Yet. TEACHING APPROACH Case discussion format This case is relatively easy to teach because the agendas of different parties are reasonably well-known. at least to Nurul Rahman (the protagonist). This enables an instructor to concentrate on credible ways to reconcile the differing objectives under a common umbrella.
i.e. Role play format This case is also well-suited for a role play session. R. Wise managers. This group should be asked to develop a detailed list of “what worked” and “what did not work” during the negotiations (plus other observations). Second. the instructor can have multiple groups representing Nurul Rahman. So it’s worth the time to uncover real similarities and offer genuine praise. ASSIGNED READINGS Cialdini. experimental psychologists have learned which methods reliably lead people to concede.. an instructor would be advised to emphasize this point both during the case analysis and when presenting the case take-away. 72-79. The first principle is that people are more likely to follow someone who is similar to them than someone who is not. Third. Fifth. or change. and iv) DHLB’s HR personnel (Observers. DHLB perspective). achieving a sophisticated grasp of the context is a challenge that many students will confront in their careers as professional managers. 48 . Thus. then. comply.. ii) Bruce Newton (DHL’s Asia region HR manager. HR department perspective).e. ABSTRACT: If leadership. studies show that people really do defer to experts. Alternatively. at its most basic. ‘Harnessing the Science of Persuasion. The instructor can divide the class into four groups: i) Nurul Rahman (the protagonist. Regional headquarters perspective). individuals are more likely to keep promises they make voluntarily and explicitly.B. individuals who do not have a stake in the outcome of negotiations. (2001). Indeed. Fourth. Nurul Rahman) will require the most horsepower. The message for managers here is to get commitments in writing. Hence. consists of getting things done through others. experiments confirm the intuitive truth that people tend to treat you the way you treat them. Many executives have assumed that this tool is beyond their grasp. Over the past several decades. Vol.’ Harvard Business Review. though. Their research shows that persuasion is governed by several principles that can be taught and applied. then persuasion is one of the leader’s essential tools. this last group can be called upon to debrief the first four groups about negotiation dynamics. Given the case facts. available only to the charismatic and the eloquent. pp. It’s sound policy to do a favor before seeking one. An optional fifth group can be made up of external observers. problem-solving manner to which the headquarters would be receptive. the first group (i. as well. it is necessary to be sensitive to the context in which a giveand-take must occur. people are more willing to cooperate with those who are not only like them but who like them. the groups need not all be of the same size. After the role play. Thus.GLOBAL BUSINESS Integrative Case Notes The key to solving this case is to develop persuasive arguments for headquarters and presenting them in a non-threatening. So before they attempt to exert influence. enlist peers to help make their cases. and one group each representing the other three stakeholders. 79 (9). iii) DHLPakistan (DHL-Pakistan subsidiary perspective).
That style is reinforced through repeated successes or changed after several failures. 65-73. Your argument is impassioned. the author stresses. ‘Change the Way you Persuade’. ABSTRACT: What stands between you and the yes you want? According to negotiation experts David Lax and James Sebenius. Skeptics are suspicious of data that don't fit their worldview and thus make decisions based on their gut feelings.A.’ Harvard Business Review. Vol. executives fall into one of five categories of decision-making styles: Charismatics are intrigued by new ideas. but experience has taught them to make decisions based on balanced information. executives face obstacles in three common and complementary dimensions.K. people want more of a commodity when it’s scarce. then. though. What went wrong? It’s likely the proposal wasn’t appropriately geared toward your boss’s decision-making style. 81 (11). But most business presentations aren’t designed to acknowledge these different styles--to their detriment. The second is deal design. R. ‘3-D Negotiation.A. pp. ABSTRACT: You call a meeting to try to convince your boss that your company needs to make an important move. the authors explore the often-neglected third dimension. Knowing executives’ preferences for hearing or seeing certain types of information at specific stages in their decision-making process can substantially improve your ability to tip the outcome in your favor.GLOBAL BUSINESS Integrative Case Notes executives should take pains to establish their own expertise and not assume that it’s selfevident. your data bulletproof. it follows. And controllers focus on the facts and analytics of decisions because of their own fears and uncertainties. the authors describe the various subtleties of the five decision-making styles and how best to persuade executives from each group. say consultants Gary Williams and Robert Miller. Finally. Each dimension is crucial in the bargaining process. And the third is setup. Lax. your logic unassailable. Williams. using culturally sensitive language. Two weeks later. you learn that your brilliant proposal has been tabled. 64-74. that exclusive information is more persuasive than widely available data. swaying the undecided. the authors conclude. 2-D negotiators focus on diagnosing underlying sources of value in a deal and then recrafting the terms to satisfy all parties. & J. D. using them judiciously and ethically-executives can learn the elusive art of capturing an audience. or they themselves. Thinkers are risk-averse and need as much data as possible before coming to decisions. have made similar decisions in the past. not just on emotions. and converting the opposition. & Miller. In this article. Followers make decisions based on how other trusted executives. Harvard Business Review. Sebenius (2003). but most executives fixate on only the first two: 1-D negotiators focus on improving their interpersonal skills at the negotiating table--courting their clients. G. (2002). In this article. 80 (5). the authors have found that executives have a default style of decision making developed early in their careers. or interactions at the bargaining table. The first dimension is tactics. Typically. pp. the authors say.B. By mastering these principles--and. or the ability to draw up a deal at the table that creates lasting value. Over the course of several years’ research. which includes the structure of the negotiation itself. Vol. Instead of just playing the game at 49 . and so on.
Assign ratings to each cell (High/medium/low priority. What is the significance of patterns you have identified vis-à-vis managing headquarters-subsidiary relations at DHL (and. (Hint: Specify two columns). Rank order above factors in terms of their: i) potential for solving DHLB’s problem. previously unconsidered players into a negotiation--and cite examples from business and foreign affairs. at other multinational firms)? Assuming you are Nurul Rahman. ii) DHLB’s Human resource department. iii) Saha. 3. And they manage and frame the flow of information among the parties involved to improve their odds of getting to yes. What factors should Nurul Rahman consider in analyzing the HRIS dilemma facing DHLB? Be as comprehensive as possible. DISCUSSION QUESTIONS List the merits/demerits of each viable alternative available to Nurul: i) proceed with DHL-Pakistan’s HRIS system. One way to conduct this case would be as follows: Introduction to the headquarters-subsidiary module 5 minutes Merits/demerits and discussion thereof (Question 1) 20-25 minutes Factors Nurul should consider (Question 2) 5-10 minutes Rank order of above-mentioned factors (Question 3) 10-15 minutes Patterns and their significance (Question 4) 10-15 minutes Finalize Nurul’s recommendations (Question 5) 10 minutes Lessons learned and Follow-up 5 minutes For a role play. 4. For a more detailed analysis include the following additional stakeholders: i) Nurul Rahman. the following schedule would be reasonable: Introduction to the headquarters-subsidiary module Assigning role and responsibilities to the groups Group breakout and preparation for negotiations 5 minutes 5-10 minutes 15-20 minutes 50 . the authors argue. 2. what would you recommend? 1. They map backward from their ideal resolution to the current setup of the deal and carefully choose which players to approach and when. Lax and Sebenius describe the tactics 3-D negotiators use--such as bringing new. 3-D negotiators reshape the scope and sequence of the game itself to achieve the desired outcome. to create and claim value for the long term. Negotiators need to act in all three dimensions. and ii) political importance from the viewpoint of: i) DHLB. and iv) DHL-Pakistan. or Not known).GLOBAL BUSINESS Integrative Case Notes the bargaining table. generally. ii) proceed with local Bangladeshi vendor. and ii) regional headquarters. They scan widely to identify elements outside of the deal on the table that might create a more favorable structure for it. 5. Identify patterns that emerge from the above exercise. TIME ALLOCATION This case can be taught in an 80-minute session. and iii) negotiate with headquarters.
e. I deliberately begin with either of the two “extreme” recommendations (Accept DHL-Pakistan offer.) Moreover. the responses refer to three actions: i) accept DHL-Pakistan proposal. Most students will recognize that maintaining status-quo is not really an option for Nurul. iii) negotiate with regional headquarters and DHL-Pakistan for a more favorable adoption of the Pakistan system. Bruce Newton (the regional VP) seems to have made up his mind about which HRIS DHLB should adopt. the Pakistan system was complicated. one for each of the three options. I purposely ignore the group recommending “Negotiate with headquarters” option. its adoption will facilitate a quicker reduction of the burden on DHLB’s Human resource department.. Nurul would likely benefit from a “correct” choice! Another pro of this option is that—despite anticipated problems—the Pakistan HRIS already exists. (Disagreeing with this rationale is not a valid line of argument because case facts do not support such deviations. If Pakistan HRIS were successfully implemented/operated in DHLB. This quickly allows students to get involved in the case. a judicial use of these monies would be appropriate. Thus. Generating this list is a simple task (see Exhibit 1). I remind this group that regional headquarters has a clear rationale for requiring HRIS standardization across subsidiaries. Was DHLB justified in spending 5x as much for a comparable (at best) HRIS? The financial 51 . it also brings to surface the underlying tension students have been trying to diffuse. Thus. On the downside. Question 1: Pros and Cons of Each Alternative These recommendations allow me to generate three columns. which I use to list the pros and cons associated with each option. I ask each recommending group to quickly summarize the key arguments supporting their choice. Option 1: Accept DHL-Pakistan proposal The biggest plus for the Pakistan HRIS option is that it has the backing of regional headquarters. Reject DHL-Pakistan offer).GLOBAL BUSINESS Integrative Case Notes Actual negotiations Debriefing from group 5 (i. Bangladeshi) vendor. and would probably take longer to implement within DHLB. Although DHLB had funds even for the expensive Pakistan HRIS. it would fulfill headquarters’ goals and potentially benefit local subsidiaries indirectly.. and ask it to identify the basis on which it believes it can negotiate with a powerful headquarters. If successfully implemented. Typically. External observers) Lessons learned and Follow-up 30-35 minutes 5-10 minutes 10 minutes CASE ANALYSIS I open this case by asking students what recommendation they—as Nurul Rahman— would make to Mr. expensive. Saha. this HRIS would standardize reported HR data throughout the Asia. ii) reject DHLPakistan proposal and go with local (i. After generating this list.e.
recommending a local vendor would put DHLB in a contest with Bruce Newton. Moreover. This ties in with DHLB’s dependence on a subsidiary over which it has no control. However. the system would cost a fraction of Pakistan HRIS price. Although DHLB could afford the more expensive Pakistan system. In that sense. Acquiring this control—though headquarters’ involvement—assumes that DHLB can fully anticipate problems arising from the 52 .GLOBAL BUSINESS Integrative Case Notes outlay here would be DHLB’s biggest line item after salaries. One of the key merits of the Bangladesh-developed HRIS was that it could be customized to DHLB’s specific (current and future) needs. If headquarters assumes an arms-length approach to the negotiations. in about six months. could Nurul convince Saha to accept his recommendation— especially one that was at odds with headquarters’ proposal? Perhaps. Moreover. the burden on DHLB’s HR was unlikely to be reduced until the local system became operational. If the HRIS did not serve its purpose. Was a locally-developed HRIS worth fighting for? Even if DHLB won the argument for going with a local vendor. But a bigger question was the extent to which this would prejudice future dealings between DHLB and headquarters. a powerful stakeholder and a useful ally. it would likely be easier to operate. would the potential political costs be justified? Would DHLB be better off conserving its energy for future endeavors that would require support from headquarters? If the local vendor option fails to deliver the expected results. Option 2: Reject DHL-Pakistan proposal and go with local Bangladeshi vendor The local solution was desirable from financial and technical standpoints. Given the political power headquarters wielded over its subsidiaries. Thus. compromise could be a solution that no stakeholder—especially headquarters—really wants. It would also constrain HR department’s ability to propose other subsidiary-level initiatives. DHLB would have a hard time justifying any other major projects— headquarters’ support or not. It may have limited time/patience for hammering out the details during negotiations. In fact. Indeed. Option 3: Negotiate with headquarters and DHL-Pakistan for a more favorable adoption of the Pakistan system The negotiations option demonstrated DHLB’s willingness for a “give-and-take” with other stakeholders: it signaled DHLB’s flexibility to work towards a globally optimal solution. Another disadvantage was that this option was at odds with headquarters’ preference. especially given Bruce’s support for the Pakistan HRIS. it could potentially end Nurul’s career at DHLB. Another disadvantage is that headquarters might not be as involved in negotiating a acceptable solution between Bangladesh and Pakistan. “negotiations” may be perceived as a softer form of challenging headquarters’ “advice” to DHLB. a disadvantage of this option was that the system existed only on paper. given Bruce’s apparent psychological commitment to Pakistan HRIS. it is likely that he will deem any deviations to be a suboptimal outcome. then it will become difficult for DHLB to enforce any promises made by DHL-Pakistan.
albeit now for the headquarters HR staff. Any recommendation therefore must account for the time element: how long can the HRIS negotiations continue? If the goal is to reduce workload on DHLB’s HR staff. As such. of a particular driver? And so on. This approach permits me to explicitly identify various factors that Nurul must consider in arriving at a recommendation. The factors that Nurul ought to consider are listed below: Financial outlays o Initial purchase price and operating cost o Potential customization costs Technical considerations o HRIS’ suitability for DHLB’s particular needs o Potential for a speedy solution re: HR bottleneck problems o Ability to automate multiple HR functions at DHLB o Ability to link various HR databases at DHLB o Adaptability to DHLB’s current and anticipated needs 53 . Yet. the fulfillment of this objective is delayed . the intent to reduce burden on HR is headquarters’ goal as well. this is a common ground for both DHLB and headquarters. The significance of generating a comprehensive list of factors cannot be understated. Indeed. Nurul needs to be very clear about what he/DHLB wants headquarters to do. the HRIS issue seems to be creating additional burden for the HR staff. and iii) establish stakeholder roles. For example. I push the two groups (Accept DHL-Pakistan offer. far from taking off the load. and likely to be a strategic persuasion during negotiations! Question 2: Factors Nurul Rahman Should Consider At the end of each summary. By negotiating with two stakeholders. Why is a particular driver a plus or minus? What is the appeal. Reject DHL-Pakistan offer) in an attempt to uncover the drivers underlying their recommended course(s) of action. Nurul also needs to consider the effect of prolonged negotiations on DHLB’s Human resource staff. The instructor can expose these roles by asking questions that illuminate the power/ influence of each stakeholder. what is Bruce Newton’s role? How important is it for Nurul to have him on board? Why is DHL-Pakistan pushing its HRIS on other subsidiaries? How far can DHLB go its own way if it decides to ignore headquarters’ proposal? How much authority and influence does/might Saha really have? And so on. The rationale underlying HRIS acquisition was to reduce the burden on HR as soon as possible. ii) highlight stakeholders’ initial positions. Thus.GLOBAL BUSINESS Integrative Case Notes adoption of Pakistan HRIS. or lack thereof. However. Nurul’s role is clear. This is because the list would: i) clarify key stakeholder motivations. As the decision maker. at least initially. the roles of other stakeholders may not be clear. any recommendation must ensure that the intended benefits reach the recipients sooner than later.
the instructor should offer a mechanism to organize the 54 . Nurul himself. To meet that objective.or technical-training manuals HRIS’ ease with respect to future customization Country-specific differences between Bangladesh and Pakistan Hard-wired routines in the DHL-Pakistan HRIS Future growth at DHLB Nurul’s initial doubt about the utility of DHL-Pakistan’s HRIS Intra-company relationships o Psychological commitment to DHL-Pakistan’s HRIS o Headquarters’ assurance (to DHLB) and its “…serious backing” for DHLPakistan’s HRIS o Relations between DHLB and other DHL subsidiaries o Regional headquarters’ perception of DHLB o Future curtailment of DHLB’s operational and strategic freedom o Potential reprisals from regional headquarters o Technical support required by Asian subsidiaries if Pakistan HRIS was adopted o DHLB’s dependence on DHL-Pakistan for technical support and future customization o Balancing various stakeholder interests o Operational HRIS at DHL-Pakistan o Assurances offered by DHL-Pakistan managers regarding their own HRIS o Political standing and influence of DHL-Pakistan within the DHL network Effect on DHLB o Effect of “…another corporate struggle” on DHLB’s HR staff o Ability to reduce the strain on DHLB’s HR staff o Ease of implementation for DHLB’s HR staff o User-friendliness to current and future DHLB HR employees o Operational ease-of-use for DHLB’s HR department o Role of HR department (“…vital role”) in DHLB’s overall operations o Psychological commitment to HRIS designed by local Bangladeshi vendor Career implications o Political fallout of Nurul making a “wrong” choice o Career-related implications for DHLB staff.GLOBAL BUSINESS Integrative Case Notes o o o o o o o Compatibility with HRIS at other Asian DHL subsidiaries Availability of user. the above list of factors should be evaluated as required in the discussion question. and Saha Cost reduction initiative at regional headquarters o Ability to fulfill headquarters’ need for regional harmonization o Ability to reduce the strain on regional headquarters’ HR staff Question 3: Rank Ordering Considerations To be useful.
this convergence will form a basis for persuading headquarters to reconsider its psychological commitment to DHL-Pakistan’s HRIS. Clearly. What should Nurul’s game plan be? How should he persuade 55 . The challenge for this group—and for Nurul—lies in figuring out where the two sets of preceding arguments begin to converge. Conversely. Bruce is probably thinking of how fast the Pakistan HRIS can facilitate his goal of harmonizing HRIS across DHL’s Asian subsidiaries! Instructors can highlight other discrepancies between the criteria applied by various stakeholders. and Nurul himself. Indeed. The local vendor option seems to be the best value—both in financial terms as well as for its ability to quickly reduce the burden on DHLB’s Human resource staff. it is not one of Nurul’s considerations: Nurul is thinking mostly from a subsidiary perspective. It is obvious that Nurul is caught between two equally “convincing” but seemingly “divergent” sets of arguments. Exhibit 2 (attached) of this note illustrates one such mechanism. the exhibit permits the “Negotiate with headquarters” group to enter the class discussion. Question 4: Patterns and Their Significance The intent of this question is to explicitly highlight the tension across key stakeholders: DHLB. two themes are likely to emerge. This is where the “Negotiate with headquarters” group must be called upon for their substantive take on the case. One implication of this exercise is that a middle ground needs to be found to satisfactorily resolve the apparent impasse between headquarters and DHLB. Nurul’s desire to alleviate the workload of HR staff does not seem to be a factor Bruce appears to have considered. To illustrate. After all. there is considerable disagreement between Nurul and regional headquarters: criteria that are important to Nurul are not as important to regional headquarters. regional headquarters. (Nonetheless. One. This is an interesting point that an instructor may wish to point out: Nurul—while a DHLB employee—has his own compass to follow!) Two. it is likely that Saha will ask Nurul for an implementation strategy—especially if Nurul recommends going with a Bangladeshi vendor. While each group of students will rank order specific criteria differently.GLOBAL BUSINESS Integrative Case Notes list. Identifying a common platform is Nurul’s responsibility—not that of the headquarters. Thus. which is unlikely to even see a need for discussion. Thus. the instructor must call upon the “Negotiate with headquarters” group for specific negotiations strategies. and vice versa. there is some divergence between them further down the exhibit. Importantly. The exhibit highlights the divergence between DHLB and regional headquarters. a midrange approach is called for. DHLB and Nurul are in general agreement about the decision criteria. the cost reduction initiative is the most important decision criteria for headquarters. it would be important for Nurul to take stock of any/all available resources and figure out how to leverage them to influence Bruce Newton.
should be emphasized at the conclusion of the case discussion. Yet. if necessary. Thus. LESSONS LEARNED AND FOLLOW-UP A wrap-up of this case should involve a brief discussion of factors that are within Nurul’s (or even DHLB’s) control. his recommendation will have implications for the nature of future relationships between DHLB and headquarters and also between DHLB and DHL’s other Asian (and perhaps non-Asian) subsidiaries. DHL-Pakistan is unlikely to be thinking about DHLB HR department). regional headquarters has promised DHLB full assistance. and how he ultimately balances conflicting demands imposed by them.. and iii) headquarters’ clear support for the Pakistan HRIS. Country manager). Lessons learned 56 . although Nurul cannot control the relations between DHLB and headquarters. Such system-wide dynamics. his conduct would likely be seen as a breach of trust in headquarters. vis-à-vis adoption of the Pakistan HRIS. at least to me. Nurul’s recommendation depends on a combination of elements. any decision Nurul makes will have ramifications throughout the DHL system in Asia. the fact that it has given DHLB this guarantee has a serious implication for Nurul: if Nurul takes this promise lightly (or is not sensitive to it or ignores it). Yet.. On the other hand. Even though it is hard to see how headquarters can keep its promise. Thus given the assurance Nurul has.g. While neither Nurul nor DHLB can exert full control.GLOBAL BUSINESS Integrative Case Notes Bruce Newton? What position can/should Nurul negotiate from? What are Nurul’s “needs” and what are his “wants”? How might Nurul handle potential resistance from DHL-Pakistan? How should he counter Bruce’s stated support for Pakistan HRIS? Should Nurul have a backup plan for possible future reprisals from headquarters? And so on. I believe subsidiary managers who can do this and successfully implement their recommendation(s) are candidates for more senior positions (e. The take-away is to realize that subsidiary managers operate at the interface of diverse stakeholders—who may not be substantively connected with one another (e. For example. The problem is compounded if one considers career repercussions for Nurul if the locally-developed HRIS does not produce the required results immediately.g. Question 5: Nurul’s Recommendation From Nurul’s viewpoint. technical aspects of the HRIS decision support a local vendor solution. Nurul’s recommendation per se is less significant than the process at which it has been arrived. this recommendation is a difficult one for three reasons: i) Pakistan HRIS is currently operational. ii) the amount of time DHL (as a whole) now has invested in the Pakistan HRIS. it is these managers’ responsibility to think carefully through various potential ramifications of their supposedly “internal-to-subsidiary” decisions. which underscore a two-way exchange and a state of constant flux. he should recommend that DHLB adopt the Pakistan HRIS. As will have been clear from the class discussion.
local decisions are often made after considering regional-level concerns and their repercussions at the local level. at least in the short term. precedence is usually given to more immediate (i. However. The manuals were not very descriptive. Saha recommended Pakistan HRIS to DHLB’s board. In late-January 2002. DHLB received the HRIS software as well as newly-developed user and technical manuals from DHL-Pakistan. The impasse between the two subsidiaries could not be resolved. often diverge—sometimes significantly. operational) concerns. not overt) and may not even appear on any organizational chart. DHL-Pakistan did not incorporate some of the changes requested by DHLB’s HR department. 57 . it did not specify the nature of assistance it would provide for the project. Regional headquarters usually sees things from a quasi-strategic perspective (as it should) and is often more concerned with standardization of (what it believes are) key parameters across its spheres of influence. and DHLB committed itself to the project. For example. Less than a month after the Pakistan HRIS was first installed (in end-February 2002). The lack of manuals meant that DHLB had to refer most problems to DHL-Pakistan. However. Of course.GLOBAL BUSINESS Integrative Case Notes In general.. even these fixes did not satisfy Human resource department’s needs. Even after the software was installed. This creates a tension between the two units. their interests. The IT department countered that it could not. Despite Pakistan’s assistance. Although regional headquarters assured DHLB of its backing. Although both are part of the same organization. about 3-4 weeks later. Fixing these bugs led to a virtual standstill in DHLB’s HR department. Pakistan claimed that DHLB’s IT department could make the required changes on its own. because of the power differential between headquarters and subsidiaries.e.e. it is not “necessary” that these two units operate as a dichotomy. there are important lessons here for managing the relationship between regional headquarters and subsidiaries.. DHLB stopped using it. DHL-Sri Lanka and DHL-Nepal also agreed to adopt the Pakistan HRIS. installation of the software ran into trouble from the very start. the HRIS initiative now had a region-wide following. and DHLB’s Information Technology (IT) department frequently had to contact its counterpart at DHL-Pakistan even for relatively simple installation problems. In December 2001. it took DHLB numerous hours to figure out some of the bugs in the system that Pakistan had delivered. What happened? Nurul recommended DHLB adopt the Pakistan HRIS. Saha’s recommendation was approved without much discussion. but only after it received headquarters’ reassurance that it would help smooth over potential implementationrelated difficulties related to the Pakistan HRIS. troubles with it continued. In contrast. At about the same time. at the subsidiary level. At a more substantive level. Decisions motivated by such political consideration can sometimes become problematic because the headquarters’ authority in many local matters often is implied (i.
DHLB and DHL-Pakistan differed in their own assessments about the cause of HRIS problems. Saha also left DHLB to pursue better opportunities at another company. The modified Pakistan HRIS finally became operational in August 2002—almost 24 to 28 weeks after Nurul first recommended its adoption. By this time both of DHLB’s Human resource executives had left the company. It was expected the updated HRIS system would be running at DHLB within two days. Within four months after the system became operational (in August. the system’s user-flexibility was still limited: all changes still had to be configured from the technical side. In July 2003. No one—including the regional headquarters—was satisfied with the outcomes. In reality. 2002). the process of ensuring that the modified Pakistan HRIS served its intended purpose was at a deadlock. Entering DHLB’s company-specific data into the new system took another month.GLOBAL BUSINESS Integrative Case Notes By April 2002. EXHIBIT 1 MERITS AND DEMERITS OF EACH OPTION PAKISTAN HRIS MERITS: Has headquarters’ support LOCAL HRIS MERITS: Can be customized to DHLB’s current and future needs Likely. easier to operate vis-à-vis Pakistan HRIS NEGOTIATE MERITS: Signals DHLB’s willingness for a give-andtake Ability to do some customizations Helps headquarters’ goal of standardizing HRIS 58 . DHLB’s Human resource department started maintaining records of new HR initiatives outside the HRIS because of the cumbersome process of updating the system. and Bruce Newton agreed that an IT expert from Pakistan would fly to Bangladesh and help set up the HRIS in accordance with DHLB’s requirements. Less than a year later. To add to the aggravation. It took the expert a full week to make the required changes. DHLB started searching again for a local software solution to replace the modified HRIS it currently had in place. the visit had to be extended twice because the changes were much more difficult to make than Pakistan had predicted. Repeated communications with headquarters could not help resolve the situation because headquarters was busy with other. whereas the other moved to another company with a more structured HR setup. more pressing issues. the HR and IT managers of DHLB. However. By June 2002. One relocated to another country. The IT expert’s visit took place in later that month. DHL-Pakistan.
g. no manuals) 5x more expensive than locally available HRIS Considerably cheaper than the Pakistan HRIS DEMERITS: DEMERITS: System does not exist at this Suboptimal. Reduce strain on Cost reduction Standardize HRIS in the DHLB’s HR staff Asia region Reduce strain on DHLB’s HR staff DHLB NURUL 59 . if DHLB’s use? Will it work? the system fails to “deliver” EXHIBIT 2 STAKEHOLDER ANALYSIS HEADQUARTERS Most important 1. it is only a plan headquarters’ view? Unlikely to reduce HR department’s burden in the near future May be perceived as challenging HQ’s “advice” Headquarters might not be as “involved” Delays the goal of reducing burden on HR Designed for DHL Pakistan. at least from time.GLOBAL BUSINESS Integrative Case Notes May benefit Nurul politically A “working” system (at least in DHL Pakistan) Quickest way to reduce burden on HR DEMERITS: Not user-friendly from DHLB view (e. Goes against headquarters’ not other subsidiaries preference. Political costs of this disagreement? Customization might delay implementation at DHLB Can Saha be persuaded? Will he support this option? Is it suitable/flexible for Could end Nurul’s career. hardwired routines..
Have slightly more than 50% can give it the same effect of control as if it had 100%. It also requires people skills in dealing with different cultures. 60 . Discuss the advantages and disadvantages of having a strategic alliance such as the LG-Nortel JV. and specialization on joint projects but a JV involves the ownership of an operation that is shared by two or more organizations. What are the unique advantages of controlling 50% equity plus one share? The students might discuss alliances and how joint ventures deviate from typical alliances. Reduce strain on HR staff at headquarters Psychological commitment to DHLPakistan’s HRIS 3. Answers to Questions: 1. However. Did Nortel make the right decision by reentering South Korea through a JV? What other market entry alternatives did Nortel have? This is a question in which the answer is not as important as the thought process and the ability to clearly articulate.GLOBAL BUSINESS Integrative Case Notes 2. Reduce strain on DHLB’s HR staff Harmonization of HRIS Cost reduction initiative across the region at headquarters Reduce strain on HR staff at headquarters Harmonization of HRIS across the region INTEGRATIVE CASE 8 THE LG-NORTEL JOINT VENTURE Analysis: success in joint ventures involves more than being in the right place at the right time with the right technical skills. This case covers one such instance. Relations between DHLB and regional headquarters Financial and nonfinancial cost of the proposed HRIS Relations between DHLB and regional headquarters Career implications Least important /Irrelevant 1. Financial outlays for HRIS 3. Relations between DHLB and regional headquarters 2. sharing of facilities. sometimes a manager who has a few such skills may be unaware that he or she lacks other skills that may ultimately produce failure for the joint venture. An alliance may involve relationships. 2.
should the smaller company simply throw in the towel or are there strategies that it may use to survive and perhaps even grow? Teaching Note The “trick” to this case is that students are lead to believe that Ocean Park is doomed. In such a case. Disney is the best thing that has ever happened to Ocean Park. the mix has 61 . he was evidently a good listener and he did try to comply with some aspects of Korean culture but he totally ignored others. The opening of Hong Kong Disney has completely changed the dynamics of the tourism industry in Hong Kong. In essence. What are the skills and attributes that successful JV managers would ideally possess? Does MacKinnon possess these skills and attributes? Students may cover several useful skills and attribute of successful JV managers but some of them were clearly present and some were clearly absent in the case of MacKinnon. he did not work to persuade others – he simply used the company’s majority ownership to push things through. Asians typically like to reach decisions by consensus but once MacKinnon reached a decision. You might ask them how they think he should have handled that. What can MacKinnon do to reduce cross-cultural conflicts within the JV? He is evidently the basis for the conflict. On the positive side. The case is set up such that students are lead to believe that Ocean Park cannot possibly compete with the deep pockets of Disney. For example. What can Nortel and LG do to improve the odds for the success of this JV? This is a question in which the answer is not as important as the thought process and the ability to clearly articulate. and better-financed MNE moving into a line of business currently occupied by a much smaller local company. Now. Previously.GLOBAL BUSINESS Integrative Case Notes 3. many of the guests to Ocean Part were local Hong Kong people. 5. Yet. better-known. according to the chairman. There is one thing that your students might enjoy discussing: he overlooked the socializing aspect of Korean business: however controversial the practice of drinking might be – especially if one is a total abstainer – it is a common way in Korea to build working relationships. He evidently wanted to phase down his involvement in the JV: should he have expedited that by seeking a different position within Nortel? 4. INTEGRATIVE CASE 9 OCEAN PARK CONFRONTS HONG KONG DISNEYLAND Analysis: As MNE’s expand around the globe there will be many instances of the type of situation described in this case. this involves the larger. Remind students of the discussion in paragraph three and encourage them to find some alternative in addition to MacKinnon leaving.
“We offer one day to Disneyland and one day to Ocean Park in our four-day package. Mehrmann also attempted to distinguish Ocean Park from Disneyland by arousing a sense of indigenous belonging.” The brighter students will pick up on this idea. Chinese culture. It is important to note that Ocean Park should not try to “out-Disney Disney” as the chairman put it. there are three major theme parks─ Walt Disney World. The case in Orlando is similar to that in Hong Kong in a sense that all the three theme parks in Orlando have different core competencies. Another interesting fact is that the Universal Studios Orlando (top 6th) and the Seaworld of Orlando (top 9th) also emerged as the North American top10 in terms of attendance in the same year . chairman of the Inbound Tours Operators Association. acquariums. while Universal Studio Orlando boasts its thrilling rides and Seaworld of Orlando is regarded as a water park. etc. they are not attracted to Chinese cultural events as are the western tourists. He emphasized that Ocean Park is not intended to go head-to-head with Disney but instead hopes to complement it. come to Hong Kong to attend Disney they want to engage in other activities. to Ocean Park. I don’t see Disneyland replacing Ocean Park… because Ocean Park has long been established as the landmark of Hong Kong. and Seaworld of Orlando. usually with children. there are examples illustrating that different theme parks flourish when located within close proximity to one another. the Magic Kingdom in Walt Disney World topped the list of attendance among all the theme parks worldwide in 2004. When families. That is. he said. Hong Kong Disneyland will surely allure millions of people from around the world to Hong Kong.This connotes that the success of a theme park does not mean the failure of the other theme parks in the same area. Ocean Park should differentiate itself from Disney by focusing on nature. They will note that Ocean Park may want to cooperate with travel agents to offer a “theme park” tour package to Mainland Chinese tourists.” “The Park is built on years of Hong Kong tradition that sets it apart from Disneyland6. This will be a win-win situation. In reality. who would at the same time be the potential customers of Ocean Park. and market response has been good. western side of Hong Kong and they want their children to have a good time. As most of them are Chinese nationals. “We really want Disneyland to succeed in Hong Kong. They will bring more people to Hong Kong and. to a much larger portion of Mainland Chinese. Evidently. and not try to create characters or fantasy. “We are Hong Kong”. also. said Ocean Park would be continued include in its schedule. Chareles Ng Kwong-wai. Similarly.” said Mr. Thomas Mehrmann with 27 years of international experience in the theme park business and currently chief Executive of Ocean Park. They want to experience the modern.GLOBAL BUSINESS Integrative Case Notes changed dramatically. Universal Studios Orlando. “They are an American import. In Orlando. Magic Kingdom focuses on Disney’s cartoon characters. Of course. 62 . Mr.
" he said. because everywhere you go. 2006 Monday SECTION: NEWS. Ocean Park chairman Allan Zeman said yesterday the new record dispelled any fears about competition posed by the newcomer.030. especially on mainland. Zeman stressed that Ocean Park did not want to duplicate “We want to differentiate ourselves markedly from Disneyland. who have made up half the park's patronage since last July .030. I don't know any other parks that beat Disney. 85 per cent of them from the mainland. who had thought Ocean Park business could drop by as much as 25 per cent when Mickey and Minnie marched into the city last September. all the other cities. said he was thrilled to see the 29-year-old park was gaining in popularity instead.030. saying the two parks had their own identities and could complement each other to boost tourism in Hong Kong. Pg.GLOBAL BUSINESS Integrative Case Notes Mr. The family of four who broke the record yesterday earned a lifetime pass good for 4. 1 HEADLINE: Ocean Park record dispels fears of Disney challenge BYLINE: Anita Lam BODY: Ocean Park passed a new milestone yesterday. 63 . had actually increased attendance at the homegrown theme park.20 per cent more than in the previous year. why do people have to visit Ocean Park?” Copyright 2006 South China Morning Post Ltd.000 visitors in the year to June 30 last year. surpassing the record annual attendance set on June 30 last year in less than 11 months. Ocean Park recorded its 4. so that's very surprising. All Rights Reserved South China Morning Post May 29. less than 11 months after it set a record of 4. Most of the growth had come from local visitors. Mr Zeman." A spokeswoman from Disneyland declined to comment on Ocean Park's performance.001 free visits.001st visitor yesterday. I would have been happy if we went down only 20 per cent. If we are just the same. plus 4 million candy pieces. and declared that Disneyland. Overseas guests account for the rest of the park's visitors. which it had feared would eat into its patronage. "A year ago. "We were budgeting for 25 per cent.
said it was his family's sixth visit to the park in the past year. Pg. needed to be full every day from now until the end of September to come close to meeting its first-year target of 5.000. and many of their programmes are more educational. 2007 Friday FINAL EDITION Ocean Park takes on Hong Kong Disneyland." Only tickets valid for a specific day or for any day within a six-month period are available for Disneyland. Estimates from the local travel industry that a daily turnout of at least 25.6 million visitors.000. And sometimes it means parading in front of the cameras in a jellyfish costume. who only gave his name as Mr Chan. "Ocean Park is closer to the city. posts profits BYLINE: Paul Wiseman SECTION: NEWS. 64 . But a source close to the park's finance division disclosed recently that the park was planning to introduce annual passes and promotions to bolster attendance. Hong Kong entrepreneur Allan Zeman is determined to do what it takes to fend off the threat from Hong Kong Disneyland and keep families coming to Ocean Park. but can go whenever they are free throughout the year. which poses greater attraction to me than Disneyland. Sometimes it means pleading with Chinese officials to part with a pair of pandas.000 is needed to meet the goal indicate only 1. "Its annual pass system also gives more edge over Disney as visitors do not have to finish their tour on one single day. 9A HONG KONG Sometimes.GLOBAL BUSINESS Integrative Case Notes The father." he said. Dings to his dignity aside. as the number of visitors had fallen short of expectations. beating Mickey Mouse means schmoozing bankers or lobbying the government for a subway line. Hong Kong's oldest amusement park. LOAD-DATE: May 29. a daily average of 7. with a capacity of about 30.000 for Ocean Park in the past 11 months. 2006 USA TODAY June 15. The source said the park.64 million people have visited the park since last September. Entrepreneur creates buzz. compared to a daily average of more than 12.
Zeman. it broke its annual attendance record -. Ocean Park. He started in the clothing business. Zeman had never visited Ocean Park." When he learned that Tung would give the job to a career bureaucrat if he didn't take it. The government considered moving it from a hillside on Hong Kong island's south side to the flatlands below or to Lantau Island. had grown shabby. brought in as chairman four years ago to salvage the place. I said. owned by the Hong Kong government. the Mouse is struggling in a new market. Since it opened in 1977. When he finally did. he was stunned." Meanwhile. "I looked at the billion-dollar view. Former Hong Kong chief executive Tung Chee-hwa set about persuading a reluctant Zeman to take the unpaid position of Ocean Park chairman. Zeman relented. Ocean Park CEO Randolph Guthrie warned in 2001 that the park might have to close." Zeman says. Mother Nature created this beautiful park for free. Formidable competition It wasn't supposed to be this way. he started turning the run-down neighborhood of Lan Kwai Fong into the place Hong Kong yuppies went to party. there was this buzz. Ocean Park had been pretty much the only game in town for parents who wanted a day out with their kids.GLOBAL BUSINESS Integrative Case Notes So far it's working. Disney reported that business is so weak that Hong Kong Disneyland might have to persuade lenders to refinance its debt. "It was unbelievable. Burbank. and the company did not return phone calls for comment. complacent and unsure what it was supposed to be -. But the park." he recalls.' At Ocean Park. has defied the doomsayers to post record profits. "People started believing. In May. he decided to develop his own.4 million visitors -with almost two months to go in the fiscal year. When he couldn't find fashionable restaurants and bars to entertain clients. David to Disney's Goliath.and the Disney threat was looming. "Suddenly.an Asian Sea World? A second-rate Six Flags? A Chinese theme park with imitation pagodas? The 1997 Asian financial crisis and the 2003 SARS outbreak tipped the park into a financial tailspin -. 65 . 'If they move this park. When Hong Kong officials in 1999 cut a deal to bring Disney here. it sounded like a death sentence for Ocean Park. "I didn't know what a dolphin looked like. where Hong Kong Disneyland opened in September 2005. is a legend in Hong Kong.-based Disney won't release figures for attendance or profitability in Hong Kong. In the 1980s.4. who grew up in New York and Montreal. Calif. where he has lived for more than three decades. they're out of their minds. In a Securities and Exchange Commission filing this spring." says Zeman.
S. They lack flexibility. were unimpressed with the pint-sized version Disney built here. amusement park executive Thomas Mehrmann." Dressing for success Zeman doesn't hesitate to go with his instincts. so they staged big events instead. eventually landing experienced U. $24 for adults and $12 for children at Ocean Park every day. "They want to make sure Disney has a consistent image. vs. The CEO was near retirement." Ap says. Hong Kong residents.." he says. It closed the gates on tourists from the Chinese mainland when the park filled and refused to allow food inspectors on the premises. the Hong Kong government. "Disneyland is about fantasy. It's real. Hong Kong Disneyland is the smallest Disney park in the world. . (Ocean Park covers 215 acres. That imperious display earned Disney a rebuke from its own partner.can't do this. Everything was a problem -. associate professor of tourism management at Hong Kong Polytechnic University. for instance. Ocean Park featured its animated sea lion mascot Whiskers with a bamboo basket filled with traditional buns symbolizing longevity. "The staff was tired. sea mammals. Zeman gave the place a paint job. "No Westerner would ever think of that. It's make-believe. At the debut of the "Sea Jelly Spectacular. I'm a can-do guy. 66 . he collected 1. pandas and sea lions. At 310 acres. Disney's executives continued to make all the decisions. can't do that. When he noticed visitors lingering in front of the jellyfish in the Ocean Park aquarium. During its 30-year anniversary celebrations. conservation. Ocean Park is at the other extreme.GLOBAL BUSINESS Integrative Case Notes 'Can-do guy' does Ocean Park "needed some TLC. which owns 57% of the park.) Disneyland's weekend entrance fee is $45 for adults and $32 for children.." Zeman says." says John Ap. many of whom have visited Disneylands in Tokyo or Anaheim..nature exhibits with dolphins. Despite the setbacks. Christmas and Chinese New Year. It's about the environment. making Ocean Park a must-see for families at Halloween. Calif.000 of the creatures and gave them their own popular exhibit. "Ocean Park is educational. The new team didn't have money for lots of new attractions." He nudged Guthrie out and launched a worldwide search for his successor. Disney alienated the community with a series of highly publicized blunders. They'll try anything. but they don't allow enough latitude." Zeman slipped into a jellyfish costume and hammed it up for delighted newspaper photographers." Ocean Park had another edge: It knew the local market better than Disney did. "They are straitjacketing the product. upgraded the food and focused on "edutainment" -.
survive in Anaheim and Orlando." she says. "I just bought a season pass.GLOBAL BUSINESS Integrative Case Notes Ocean Park has pulled off other coups: The Chinese government agreed to donate two pandas to the park. He hopes to win more loyal customers like Hong Kong college student Chu Wai-yan. Zeman says the Hong Kong government has approved a subway line to Ocean Park. Should Ocean Park intensify or reduce head-on competition with Hong Kong Disneyland? Encourage all points of view but a student will have an uphill battle explaining why it would be good for the weaker Ocean Park to take on the giant Disney organization.S. Answers to Questions: 1. Also. such as Sea World and Universal Studios. In which cell in Chapter 11’s Figure 11.4 would you put Ocean Park? Most students will state that it is pursuing a defender strategy but challenge them to indicate whether that is the most desirable strategy and if not. Ocean Park has more of a Chinese identity and Disney is more U. For whatever action Ocean Park chooses. are local companies (such as Ocean Park) doomed? This is a question in which the answer is not as important as the thought process and the ability to clearly articulate. like the one it built for Disney." And Hong Kong Disneyland? "I liked it. 3. 4. bringing the park's total to four.) Students should recognize that sometimes what seems to be a problem is really an opportunity. "Of course I'll be back. She figures she has visited Ocean Park 20 times since age 12. When confronting multinationals (such as Disney)." Chu says. the public can see new arrivals Le Le and Ying Ying on July 1. How does the influx of mainland Chinese tourists resulting from Disneyland affect the tourism industry in Hong Kong? Can Ocean Park capitalize on this new phenomenon? (Hint: Check out how other parks surrounding Disney. 2. how should Hong Kong Disneyland react? 67 . Zeman has lined up financing and government loan guarantees for a $700 million expansion that will double the park's attractions to 70 by 2012. 20. They should be able to make suggestions based on Ocean Park’s identity with sea life – something that is not the major focus of Disney. "But once is enough. 5. the 10th anniversary of the hand-over of Hong Kong from British to Chinese rule. what strategy should Ocean Park pursue and how.
One thing that your students will find interesting about this case is that the consulting organization dealt with international business so it would be expected that would especially successful in applying its knowledge of cultural issues within its own organization but that was its weakness. 2. However. what norms and values have inhibited the more effective flow of knowledge through KX? The student should have no problem answering this question. INTEGRATIVE CASE 11 Competing in the Chinese Automobile Industry Analysis: relate this case dealing with FDI to the theme of the chapter . How would you address the knowledge management problems at Accenture? This is a question in which the answer is not as important as the thought process and the ability to clearly articulate. Why does Accenture consider knowledge and knowledge management to be its primary source of competitive advantage? It has made an impressive use of technology to develop a database and capabilities regarding the use of that database. the one thing that gives a consulting organization any value at all is knowledge and the ability to use it to help clients. while the value of knowledge cannot be adequately quantified in dollar terms.GLOBAL BUSINESS Integrative Case Notes This is a question in which the answer is not as important as the thought process and the ability to clearly articulate.global and regional integration. INTEGRATIVE CASE 10 GLOBAL KNOWLEDGE MANAGEMENT AT ACCENTURE Analysis: increasingly. You might ask how such a situation could exist in an organization that specializes in international business consulting. one thing which should be discussed is “why should it be necessary for Hong Kong Disneyland to react” in the sense of doing something different. The geographic area as well as the population makes it more than comparable to other areas of the world that have 68 . In fact. From an institution-based standpoint. What problems in knowledge management has KX exhibited? Lack of appreciation for regional knowledge. Is this a case of “physician heal thyself”? 4. it is becoming more important than any asset that can be listed on a balance sheet. Answers to Questions: 1. inadequate support for challenges at the local offices. That should not be difficult to do. 3. and insufficient allowance for local control.
it should be noted that Honda used it successful exports to China as a means of building up its market there prior to beginning production in China. 3. Similarly. However. others were encouraged to enter. Whether one would vote yes or no would depend on the willingness to take risk and that willingness might be affected by the development of a strategy to weather any such shakeout. Why happened that made them to change their mind more recently? As the potential market expanded and as the experience of a few firms proved successful. one thing contributing to the growth of the United States is that all 50 states are integrated into one market and entity. From a resource-based standpoint. what role does entry timing play in determining performance? When discussing this with your students.GLOBAL BUSINESS Integrative Case Notes benefited from integration. but other late entrants (such as Ford) are struggling. explain the initial reluctance of most multinational automakers to enter China in the 1980s. Like China. From an institution-based view. some late entrants (such as Honda) did well. Some early entrants (such as Volkswagen) succeeded. If you were a board member at one of the major multinational companies. consider the possibility that timing is only one of several factors and that the human resource involved will determine when an otherwise brilliant timing will pay off. Would you vote yes or no for a $2 billion proposal to fund a major FDI project in China? The last paragraph presents a risk (over capacity during an industry shakeout) and an ultimate expansion of the market. but other early entrants (such as Peugeot) failed. Why do all multinational automakers choose to use FDI to enter this industry? What are the drawbacks of using other entry modes such as exporting and licensing? The FDI may involve joint ventures (as in China) or total ownership but FDI provides advantages in terms of quality control and greater control over its markets. you have just heard two presentations at a board meeting outlining the two contrasting scenarios for the outlook of the Chinese automobile industry in the last paragraph of the case. Answers to Questions: 1. 4. INTEGRATIVE CASE 12 KALASHNIKOV: SWORDS INTO VODKA 69 . (Note that originally each “state” was regarded in the same way that we today use the word “state” to refer to a sovereign nation – as in the Head of State) The Chinese automobile industry benefits from that type of economic integration. 2.
his service may have paid off for the government but not for him. However. 4. From an institution-based view. INTEGRATIVE CASE 13 SHAKIRA: THE DILEMMA OF GOING GLOBAL Analysis: the case has many interesting potential applications and your use of the case may be affected by the interests of your class. Songs in a different language do not simply appeal to only those of that 70 . is still interested in making money. It is interesting to note how the case brings an often-observed reality: art and music can transcend differences in language and ethnicity. now 85. Most people probably would not view the end of the Soviet Union as a tragedy but impact of that end on some people might be so viewed. The case involves a person who served the Soviet Union in its military and created a product known around the world – however. What does the future hold for the small-arms industry? The case study suggests that a decline in crime harms the industry but it is possible that any acceleration of terrorism could expand demand for both offensive and defensive purposes. Although he achieved a high rank in the Soviet military and his government made money from licensing the product of his AK47. depending on one’s focus. this is a question in which the answer is not as important as the thought process and the ability to clearly articulate. Russia did not reciprocate financially and he has a need to continue to earn income. 2. What are the ideal marketing and supply chain capabilities for the small-arms business? What are the ideal marketing and supply chain capabilities for the vodka business? This is a question in which the answer is not as important as the thought process and the ability to clearly articulate. Given that he has lent his name to so many products. His name now is a means of him surviving as it is used on various products. predict whether his new vodka venture is likely to succeed. 3. General Kalashnikov is becoming an entrepreneur by leveraging his brand to enter the vodka (and other) business. Essentially. This case deals with two of the arguably strongest “brand images” (if not strict brands per se) out of Russia: Kalashnikov and vodka. in the new Russia. explain why Kalashnikov. it would seem that it will take more than just his name to sell his new vodka. this is a question in which the answer is not as important as the thought process and the ability to clearly articulate.GLOBAL BUSINESS Integrative Case Notes Analysis: this could be viewed as a happy or sad case. Answers to Questions: 1. From a resource-based view. In any event.
Does her manifestation in social responsibility play a role in facilitating her commercial success? This is a question in which the answer is not as important as the thought process and the ability to clearly articulate. Among points that might be mentioned by students would be her knowledge. is singing in Spanish versus in English. This is a question in which the answer is not as important as the thought process and the ability to clearly articulate. which. Answers to Questions: 1. in this case. 5. can she sing 100% in English? Can she afford to be perceived as having “abandoned” her Colombian middle-class origins for the Latin elite based around Miami and the Bahamas? This is a question in which the answer is not as important as the thought process and the ability to clearly articulate. 2. 4. INTEGRATIVE CASE 14 SHAKTI: UNILEVER COLLABORATES WITH WOMEN ENTREPRENEURS IN RURAL INDIA 71 . singing in Spanish does not exclude those who only speak English since words for music function in a different role than words used in how to assemble one a product: in one case the words perform artistic affects such as creating an appealing sound (not necessarily an understandable message) but words for utilitarian purposes such assembling a product having nothing to do with artistic beauty and would need to be understood. A leading concern in international marketing is localization versus standardization. From an institution-based view. even if she so chooses. discuss the informal norms constraining Shakira’s choices. In what language should Shakira release her next album? This is a question in which the answer is not as important as the thought process and the ability to clearly articulate. explain what is behind Shakira’s phenomenal success. and an ability to project the image that she want others to have of her. For example.GLOBAL BUSINESS Integrative Case Notes language. contacts with Spanish speaking entertainers. However. 3. From a resource-based view. As people around the world come interact more through technology. it may be that many of the stereotypical characteristics of various ethnic and cultural groups may become more and more blurred and will call for more frequent revisions in marketing strategy. Discuss the pros and cons of each approach.
From an institution-based view. financial security. However. HLL is not doing this out of the goodness of their hearts but the case does show that firms can sometimes find creative ways of simultaneously advances their own interests by advancing the interests of others. 6.GLOBAL BUSINESS Integrative Case Notes Analysis: “Doing well by doing good” is an ideal and the Shakti approach may indeed by a win/win situation. By focusing on efficiencies. Answers to Questions: 1. by increasing the economic activity in some of the rural areas. it may ultimately help reduce poverty somewhat. what is the impact of Shakti’s activities on poverty alleviation? It should be noted that those directly involved are not among the poorest since the entrepreneurs must make a small initial investment. These retailers were loyal because a large portion of revenues typically was comprised of Unilever products. 5. 2. What metrics can Shakti use to measure its impact? Economic metrics would include income and employment levels. What should Shakti do to enhance its poverty alleviation impact? This is a question in which the answer is not as important as the thought process and the ability to clearly articulate. From the perspective of those at the base of the pyramid. 3. reach. 72 . Using this distribution chain. what are the barriers against ventures such as Shakti? Barriers include the size. it was able to stitch together a vast network of retail outlets that were connected seamlessly by the country’s most sophisticated distribution chain. before and after Shakti. the impact on abstract things such as feelings of self-worth. However. may be somewhat measured by survey but they may fail to adequately quantify such non-economic impacts. offering the company an advantage that was the envy of its competitors. Why is HLL pursuing Shakti? Is Shakti successful? Shakti helps provide HLL with a distribution system that reaches untapped markets and it appears to have been fairly successful. 4. number and diversity of the Shakti units in competition with other private or government organization that may adopt a similar approach. and visibility. what were HLL’s competitive advantages prior to launching Shakti? HLL invested in an extensive distribution system in India that eventually became a source of its competitive advantage. etc. HLL could efficiently provide its products to consumers in a convenient fashion. From a resource-based view.
reorganization.GLOBAL BUSINESS Integrative Case Notes INTEGRATIVE CASE 15 COMPUTIME 1. What is the rationale behind Bernard’s reorganization idea? How can Bernard expand the business? He needs a flatter organizational structure that is less centralized and better able to respond to customer needs so that the business can expand. 73 . they felt comfortable about the financial side and the balance sheet and knew that they needed to reinvest in the company. Analysis: the case brings out the problem of managing change – in particular. would you welcome the restructuring plan? Why or why not? What steps can Bernard take to get organizational m This is a question in which the answer is not as important as the thought process and the ability to clearly articulate. What is the general environmental situation faced by Computime? The organization is confronted with significant growth opportunities but its current organizational structure makes it difficult to take advantage of those opportunities. What they wanted to know was whether the reorganization was the right way to reinvest rather than whether they could afford it. If you were an employee of Computime. What are the major challenges facing Bernard in the course of the restructuring? How should he address those challenges? This is a question in which the answer is not as important as the thought process and the ability to clearly articulate. what would you do?” Answers to Questions: 2. Board members were also afraid that they could not obtain enough competent leaders and supporting staff to facilitate the consolidation. Reorganization can be a threat and some may try to avoid it by searching for persuasive reasons why it should not be done. 6. 3. Furthermore. as the board members said. Focus your discussion on the part of question six which asks: “If you were the HR manager. 5. 4. they were afraid that dividing the company would reduce economies of scale and could create three distinct cultures. Why does the board of directors have reservations regarding the reorganization plan? Are the reservations valid? What can Bernard do to win them over to his plan? Board members were concerned that the functional expertise would diminish as the best functional heads were removed to lead the new divisions. On the whole.
GLOBAL BUSINESS Integrative Case Notes In regards to the validity of the reservations and what Bernard can do. what are some of the HRM issues that Bernard should address? If you were the HR manager. 7. these are questions in which the answer is not as important as the thought process and the ability to clearly articulate. what would you do? This is a question in which the answer is not as important as the thought process and the ability to clearly articulate. To carry out restructuring successfully. 74 .
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