Philips vs Matsushita Case
1.Briefly describe reasons for Phillips and Matsushita to operate internationally. Why do they do it?
Describe the international strategy of Phillips and Matsushita using the international strategy classifications we discussed in class (e.g., localization, transnational, global).
Philips and Matsushita are two electronic (equipment and service) based powerhouses who had to expand their business to the international market. One my ask why they needed to operate internationally… each company, Philips and Matsushita, wanted to stand in front of their peer companies as the market leader in the industry. In order to do this, each company would go through various changes, some of which hurt and some of which
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This structure is unlike that of the Philips where locals, within the national organizations, held senior management positions. Basically, the structure gave some leeway to product control but still kept the same global image of Matsushita. As times/cultures changed, the strategy that existed with Matsushita during the early years proved to be the foundation of a successful company.
3.How these strategies are related the performance of these companies over time? Why? What is going on in terms of industry competition and markets that makes one strategy outperform the other at any point in time?
The performance of each company is different from time to time based on their two different international strategies. Philips, for instance, showed poor struggles between national organizations and product divisions since there was no centralized decision –making terminal. In the end, the national organizations held the power because they were in control of the assets. Being in control of assets, the national organizations had more influence on the management team. Also the lack of clarity between the two’s responsibilities did not allow Philips to function effectively as a whole. They did have one thing going for them though. Philips was able adapt to changing markets based on their localization strategy. They
The first change was removal of trade barriers and new agreement bodies, like GATT and EC, facilitated greater competitiveness among old and new players in the market. Meanwhile, companies from Japan emerged as world-class players in Philips’s home turfs with companies like Matsushita, which manufactured at home but exported its products all over the globe, taking benefit of the economies of scale. Furthermore, R&D costs increased dramatically while product lifecycles reduced, thus reducing the time a company needed to recover its investment. To help make new products successful, mass production was needed to bring in economies of scale but shorter product life cycles limited this possibility as well. The implication of these changes was that previously Philips was more concentrated towards its local market through its national organizations, but new global competitors with global strategies changed the market dynamics. For Philips the environment was rather simple and stable but upon entry of new players the environment became more complex and
Most young people believe that studying in a different country is a privilege because they are able to experience other cultures, and learn from them. However, in the United States it is not as good as they thought because International students have much more pressure being in this country, and sometimes they cannot handle it very well. Therefore, in the United States the life of an international student is very unfavorable if people compare it to the life of an American student. International students have to learn a new language to study, they cannot work while studying, and their tuition is much more expensive.
How does any company survive in today’s global market, whether they are large, small or indifferent? Today’s global market place has truly become an enigma, or should I say, “a puzzle within a puzzle, within a puzzle”; however, there have been a precious few that have helped to guide Japan, Corporate America, Corporate Canada and
2) What idealized arc routing problems have been used for roadway snow and ice control?
N.V. Philips (Netherlands) and Matsushita Electric (Japan) are among the largest consumer electronics companies in the world. Their success was based on two contrasting strategies – diversification of worldwide portfolio and local responsiveness for Philips, and high centralization and mass production for Matsushita.
In taking the management role, I will find a way to create a strategy to maintain a nonunion employment situation. Some important facts about this case study is that Custom Conveyer Division employs about 120 production employees and 11 supervisor/management positions. The 120 production employees are split evenly between five semi-skilled job classifications. There are two other plants in Cumberland that hire employees with the same type of skills and start pay about $1 less an hour than CCD. There is room to expand the company but work has been steady lately, a layoff is possibly in two months if new orders aren’t received.
In an international environment, firm internationalisation is required to compete with other firms. According to Bartlett and Ghoshal (1988), a firm able to control and manage their operations upon expansion will have more chances of success.
There are several reasons why Phillips and Matsushita chose to operate internationally. For Phillips, it was due to the small size of their home in Holland. The company was forced to seek aboard for larger places to mass produce. After they hired an export manager, they were on their way to selling to the diverse markets of Japan, Canada, Brazil, and Russia. Soon after, the Phillip’s industry had to build more organizations in the United States, Canada, and France because they were over their capacity. As for Matsushita, during the post-war, they presented a broad line of new products, therefore they needed to seek a bigger sales volume. They opened several domestic outlets and forty percent of them went to Japan. This not only would fix the sales volume issue but also would give them access to the latest market trends. They then looked to export more markets after the growth slowed though the best they could do was an exchange and license contract with Phillips because American companies were unwilling to work together. Matsushita resorted to working with mass merchandisers under a private brand which then pushed them to open plants in Asia, and South America and later assembled operations in all the Americas, Europe and in Wales. Phillips and Matsushita have followed different international strategies and have had substantial skills and downfalls. Phillips followed the localization strategy with great self-sufficient National Organizations units to focus on local responses
Currently, it is difficult to have a solid position in markets as well as meet all demands of people in a detailed market. Thus, international markets may bring potential new chances such as developing products in new markets, expanding range of customers or rising awareness of foreigners about company. In particular, an good international strategy can bring a number of benefits to the company, Australis
In order to match the global standards they first successfully established their business in domestic market, understood the needs and saw a good rise and then implemented it globally.
a. The 3 main causes of businesses fail are management shortcomings, lack of training, and government regulations. Many times people are unprepared for the demands of running a small business. It takes all of your time, money and energy to keep a small business alive. . In the beginning it's all about you and you have to be honest with yourself about just how capable of a manager you are. If you make rash, fearful decisions or if you are not great at managing people, you will have a hard time making your business work. This also has to do with if the individuals that start the businesses have very little training. It’s hard to train others when you, yourself have no idea
Even though the multinational organization proved effective as the NOs could respond to local needs through customized products, it caused Philips to have higher economies of scale than their competitors (most notably Matsushita) since very few of their products were standardized. They could not go into mass production and spread the production costs over tens of millions of units of any product because most products were specialized for the individual countries. This led to inefficient factories that were being closed or downsized by management during their continuous re-organizational efforts.
How did Philips become the leading consumer electronics company in the world in the postwar era? What distinctive competence did they build? What distinctive incompetencies? When Philips was founded in 1892, their strategy was to focus strictly on producing and selling light-bulbs. By investing in new production technology to manufacture their light-bulbs, Philips became a leader in industrial research. Research in Gerard Philips’ opinion was vital to implementing new procedures, innovation, and improving production. At this time, Philips was using the home replication strategy. This strategy is used when a company does not see any reason to adjust their domestic strategy as they enter international markets. Around 1918, Philips began expanding its product line which made it more difficult to implement the home replication strategy. During the late 1930s, when the war was about to begin, Philips moved around its overseas assets,
Krom Bop-A-Lee’s experience in Bombay, India is undoubtedly a common one for those from First World countries unaccustomed to the relatively poor working conditions present in many parts of the world. As Westerners, many luxuries are taken for granted, and the absence of these luxuries can have a profound impact on one’s moral and ethical foundation.
10. The profile of change in the global financial services industry showed that industry conditions change because _____.