Innovation in South East Asia: Lessons for Europe?
Mike Hobday, Science Policy Research Unit, University of Sussex | Despite the rapid growth of Malaysia and other South-East Asian economies, very little is known about innovation in the region. Electronic goods and components, a large proportion of total exports, are mostly manufactured by large foreign transnational corporations (TNCs). According to conventional wisdom, innovation occurs in the developed countries, rather than in the TNCs' subsidiaries. However, using Malaysia as an example, the paper shows that technological and organizational innovation at the local TNC plant level has played a major part in Malaysia's export success. Based on recent field research, the paper assesses the nature, focus and extent of innovation within the TNCs'subsidiaries. The firm-level data show that production-related innovations have been central to Malaysia's export growth and that by demonstrating their innovative skills, local managers played a part in encouraging TNCs' headquarters to expand operations and to transfer technology. Using a simple model to situate subsidiary innovation within the context of global TNC strategies, the paper raises key questions concerning the European Union, and in particular, the UK, which now relies heavily on TNCs' investments for its industrial future. |
Financial system design in the Asia Pacific context: Costs and benefits of universal banking
Anthony Saunders and Ingo Walter, Stern School of Business, New York University | This paper is concerned with universal banking's role in the evolution of
national financial systems, notably with respect to their role in overall economic performance. Sections of the paper deal with conceptual and empirical evidence regarding mergers and acquisitions (M&A) in the financial services industry, with special relevance to the Asia-Pacific region. The discussion develops a typology of intra- and inter-sectoral M&A transactions among banks, insurance companies and securities firms, and examines the global deal-flow during the eleven-year 1985-1995 period. It then discusses the dynamics of M&A transactions in the financial services industry, notably with respect to exploitation of economies of scale and economies of scope that are core to the universal banking concept. The implications for the Asia-Pacific region are developed, with reference to the static and dynamic efficiency properties of national financial systems. |
Australia's Asian business orientation: Investor and intermediary
Ian Marsh, Australian Graduate School of Management, University of New South Wales | Since 1992, there has been a significant shift of Australian business investment from Europe and America to the Asian region. Over 65 percent of manufacturing, 90 percent of infrastructure, and some 90 percent of services investment, committed or under consideration in the last three years, involves projects in regional states. Survey findings suggest the need to locate operations close to customers is the primary motive, followed by the growth of particular markets. Lower labor costs have also been a factor. In recent years, Australia has also sought to position itself as a regional headquarters location -- and has been particularly successful in the telecommunications and software sectors. Finally, Australia has sought to attract regional firms seeking bases in, or experience of, western environments. All these developments mark changes in business strategies and in the public policy environment. This realignment of activities creates new opportunities for international managers as it poses an array of new strategic and operational issues for Australian managers. These implications have yet to be reflected in management research. |
Moral consideration and strategic management moves: The Chinese case
Kam-Hon Lee, Faculty of Business Administration, Chinese University of Hong Kong | Although it differs from that practiced in the West, moral consideration is a key factor in making strategic moves for business people in Chinese society. This article substantiates this claim based on evidence from business history in China, overseas Chinese business practice, and Chinese experiences today. Then, this article deliberates on the management implications of this phenomenon for people who want to do business with Chinese and in China. | The Black Hole of South East Asia: Strategic decision-making in an informational void
George T. Haley , School of Marketing & International Business, Queensland University of Technology, Australia and Chin-Tiong Tan, Faculty of Business Administration, National University of Singapore | Most managers and researchers acknowledge that emerging and newly industrialized markets do not have the same quantity of secondary data as the long-industrialized economies of North America and Western Europe. We present the results of a search of available, business-related. secondary data on Southeast Asia's rapidly growing economies; we highlight how this dearth of data has resulted in an informational void that affects the practice of strategic management in the region. We delineate how regional managers cope with, and adapt to the informational void, and to the region's fast-changing business, cultural and competitive environments, by developing their unique, highly-intuitive style of strategic management. We also provide some suggestions to bridge this informational void for management practice and for future research. | Singapore Incorporated: Reinterpreting Singapore's business environments through a corporate metaphor
Usha C. V. Haley, Managing Business in Asia Program, The Australian National University, Australia, Linda Low and Mun-Heng Toh, Faculty of Business Administration, National University of Singapore | We use the metaphor, Singapore Incorporated, to reframe Singapore's
government-led development. The metaphor encapsulates stakeholders'
relationships: these relationships provide goals and constraints for
Singapore. Thus, the metaphor helps to reinterpret Singapore's business
environments and strategic destiny. First, we highlight strategic
alliances with stakeholders in Singapore's growth and development. Next,
we focus on Singapore's enacted economic, political and social
environments. Finally, we explore the metaphor's implications and
discuss its relevance for theory and policy. |
Asia at risk: The impact of methodology in forecasting
Llewellyn D. Howell and Donald Xie, American Graduate School of International Management (Thunderbird) | Foreign investors have clamored into Asia in the 1990's hoping to tap into the spectacular economic growth, but have often done so without awareness of existing or likely future political and social conditions
that could affect their investments and business operations. Political
risk insurance is available from agencies such as the World Banks's MIGA
or the U.S. government's OPIC, but projecting needs for such insurance
has not been a consistent practice. Business publications such as the
Economist and firms such as Business Environment Risk Intelligence, Inc.,
(BERI) provide regular projections of political risk based on a variety
of observed political and social variables. The choice of these
variables is examined in an Asian context and the forecasting capability
of the Economist and BERI models is assessed statistically. The study
finds that the existence of underlying theory makes a positive difference
in the ability of the models to forecast correctly and to provide useful
advice to foreign investors. Both models include variables representing
conditions that clearly indicate future trouble for investors. The study
shows that, with some revisions, existing models of political risk can be
useful in guiding investment and trade. |
Strategic management of international business relationships with New Zealand: A primer for executives and investors
Andre' M. Everett, Advanced Business Programme, University of Otago
| Sweeping structural reform combined with national change in attitude have dramatically altered the business environment in New Zealand. Yesterday, New Zealand was a tale of faded prosperity and lost promise; today, it receives praise from the World Bank, the International Monetary Fund, and the Economist as a role model for economic reform. Protectionism, interventionism, and import substitution have been replaced by nearly complete economic freedom. As a key component of these reforms, liberalization of international and domestic trade is providing
unprecedented opportunities and challenges for both multinational and local firms. Following a stage-setting introduction to the country and its people, this article outlines the recent decade of economic rebirth, exploring the ramifications of the national restructuring on
business strategies and decision making in the areas of market entry, importing and exporting, investment, human resource management, and innovation. Major current issues affecting business are explored, and policies on inbound foreign investment and immigration are examined. |
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