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Global Business Strategy: Multinational Corporations Venturing into Emerging Markets
In the fi rst decade of this century, the global economic environment has seen tremendous changes. The most signifi cant is the rise of emerging countries. The share of global GDP accounted for by developed nations such as Japan, the United States, and European countries has dropped from almost 80 % in 2000 to about 60 % in 2010. I estimate that this share will fall to around 50 % by 2020 and to about 40 % by 2030. Meanwhile, emerging countries such as China, India, and Brazil are increasing their market sence. In terms of population, the picture of a global economy centering on developed nations, in which those countries that represent 10 % of the population generate 90 % of the wealth, is disappearing. It is becoming increasingly important for global companies to develop business strategies to adapt to this new era. This book systematically summarizes the business strategies of global companies that are addressing the rise of emerging countries. While in the past, textbooks on international management and global business theory were mainly based on developed countries, this book is characterized by a primary focus on strategies for emerging countries, where the business environment is quite different from that of developed nations. Among these emerging countries, China and India are discussed
because they are believed to be the two chief economic powers of the twenty-fi rst century. The book contains case studies of companies operating in those countries to allow readers to obtain some understanding of how business fi elds differ from those in developed nations. Also, instead of a narrow discussion of how overseas businesses differ from domestic businesses, the book’s content focuses on the concept of an overall business strategy for an enterprise that aims to become a true global company drawing on all of its management resources. For a number of Japanese companies, more than half their sales come from overseas markets, and their overseas subsidiaries hire signifi cantly more employees than their domestic ones. However, their governance structure is still centered on the head offi ce in Japan and is generally far from an optimum global management organization that takes advantage of diversity in countries into which they have expanded. I believe that it is crucial for Japanese
companies to improve their business organizations on a global scale, given the fact that the main business battlegrounds have moved from Japan to overseas, to emerging countries in particular
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