Emergic: Rajesh Jain's Blog

Emergic: Rajesh Jain's Blog header image 2

TECH TALK: Good Books: Dragon Stories

November 13th, 2002 · No Comments

>Dragon Multinational: A New Model for Global Growth
By John Mathews

Most business books tend to focus on success stories from the developed markets such as the US or Western Europe. Few, if any, look at the emerging markets. Of course, the success stories of emerging market companies that have become global players are also few and far between. But what does it take for these companies to succeed in the competitive marketplace? That is a question John Mathews set out to answer. His book describes the extraordinary success of a handful of multinationals from the Periphery [as opposed to the Triad of North America, Europe and Japan] in globalizing their operations extremely rapidly and becoming major players in industries as diverse as steel, cement, information technology, and general manufacturing, as well as in services such as finance and hotels.

Mathews describes dragon multinationals as companies that start with disadvantages as latecomers, but they devise clever strategies of linkage and leverage to take advantage of the worldwide web of interfirm connections that characterize the global economyThese are firms that start from behind and overcome their deficiencies to emerge as industry leaders, in sometimes astonishingly short periods of time, without any of the advantages of the incumbent industry leaders. They do so without initial resources, without skills and knowledge, without proximity to major markets, and without the social capital that is to be found in regions like Silicon Valley.

Among the enterprises Mathews discusses are Acer, Li & Fung, Ispat, Cemex and the Hong Leong Group.

Growing Global: A Corporate Vision Masterclass
By Stan Shih

Acer is one of the dragon multinationals Mathews discusses extensively in his book. So its good to get a more detailed perspective from Stan Shih, Acers founder and CEO. Acer is, arguably, one of the big successes out of Asia in the IT industry. It has gone through many ups and downs, overcome the limitations of its small home market in Taiwan, and restructured many times to emerge as a global player. Acers lessons and learnings are very useful for many in the emerging markets who have global dreams.

Stan Shih writes out the four challenges Acer faced in its globalisation: the need to overcome the stereotype of MIT (Made in Taiwan), with Taiwan being perceived as a place for manufacturing low-cost, low-quality products; very limited financial resources to fund global operations; access to a relatively limited pool of global talent; highly fragmented Asian markets which do not enjoy the same economies of scale as US or Europe.

Shih discusses Acers three major globalisation strategies: a Global Brand, Local Touch strategy to develop a strong partnership with leading local channel partners to increase access to funds, talent and marketing capabilities in different markets; a From Peripheral to Core strategy, starting with secondary markets (developing economies) to then move to the core markets; an Innovation in Technology and Management strategy which entailed the development of innovative products and management practices.

Tomorrow: The New Enterprise


Good Books+T

Tags: Tech Talk

0 responses so far ↓

  • There are no comments yet...Kick things off by filling out the form below.

Leave a Comment