Presentation by Melinda Smith, Rosie Campo,

Stefanie Oncescu and Janice Mok

• Japan called ‘Nippon’ (にっぽん) or ‘Nihon’ (にほん)

• ‘Land of the Rising Sun’

Size: 377,915 sq km

• Approx. one-twentieth the size of Australia

Reference: Kwintessential (2009)

Capital: Tokyo

Size: 377,915 sq km

Population: 127,078,679 (July 2009)

Population density = 343 per square kilometre

Population density = 91 per square kilometre

Reference: Kwintessential (2009)

• 99% are Japanese

Ethnicity

• 84% observe both Shinto and Buddhism

Religion

• Beliefs of Confucianism also impact many ethics and laws

Reference: Kwintessential (2009)

• Literacy rate is close to 100%

Education

• 95% have a high school education

Reference: Kwintessential (2009)

• Japanese is the sixth most spoken language in the world

• Agglutinative language- works on complex system of honorifics

• English lessons compulsory in Japanese schools

Reference: Clark et al (2010)

• Strong economic growth- 10% in 1960s, 5% in 1970s

• ‘Keiretsu’- close interlocking of manufacturers, suppliers and distributors

• Guarantee of lifetime employment

Following World War II

Reference: CIA (2010)

• Economic decline due to poor investment and asset price bubble

• Entered into recession due to GFC

1990s

2008

• Sharp downturn in business investments and exports

Reference: CIA (2010)

• GDP = $4.137 trillion (US Dollars)

• Ranked 4th in the world (GDP)

• Among world’s largest producers of motor vehicles, electronic equipment, machine tools, steel, textiles

Reference: OECD (2009)

2009/2010

• Ranked 5th in the world (GDP)

• $516.3 billion (2009)

• Important export partners- US (17.8%), China (16%), South Korea (7.6%), Taiwan (5.9%), Hong Kong (5.1%)

Exports

Reference: OECD (2009)

Exports-Commodities

Transport equipment

Motor Vehicles

Chemicals

Electrical Machinery

Semi-conductors

Reference: OECD (2009)

• Ranked 6th in the world (GDP)

• $490.6 billion (2009)

• Important import partners- China (18.8%), US (10.4%), Saudi Arabia (6.7%), Australia (6.2%), UAE (6.1%)

Imports

Reference: OECD (2009)

Imports-Commodities

Machinery and equipment

Foodstuffs

Fuels

Raw materialsChemicals

Textiles

Reference: OECD (2009)

JAPAN USChina

South Korea

TaiwanHong Kong

• Economy is stabilising again after GFC- strengthened growth of exports

1956 2008

• Economic growth and decline-1956 - 2008

• Public Debt: 192.1% of GDP

Reference: World Economic Prospects (2010)

• Greet with a bow

• May shake hands

• Be on time

Reference: Clark et al (2010)

• Do not talk with your hands- pointing isunacceptable

• Last name and ‘san’- sign of respect

• Dark conservative attire

Gestures

Address

Appearance

• Women- low heels and skirts

Reference: Williams (2008)

• Non-confrontational- avoid saying no

Negotiation

• Don’t lose your temper- strive for harmony

• Polite- avoid embarrassment

Reference: Clark et al (2010)

• Drinking important part of culture

• If invited out let the host order and pay

Social Events

• Called ‘meishi’

• Treat like you would a person

• Place on table in front of you

Reference: Kwintessential (2009)

ReceivingGiving

Reference: Kwintessential (2009)

Reference: Kwintessential (2009)

• Ceremony surrounding this is very important

Gift Giving

• Gifts are not opened in front of giver

• Always give a gift and receive it with two hands

Reference: Clark et al (2010)

• Hierarchy- most senior will sit furthest from the door

• Always provide literature about your company

Tradition Technology/Advancement

Mitsubishi and Kim Eng

Q1: • What are the strengths of the companies? • How can this alliance be mutually beneficial? • Will this increase consumer desire to purchase

their goods and services?

Motor vehicles + many other smaller companies

Securities and investment broker

Singaporean company

Japanese company

Mitsubishi and Kim Eng

• Strengths: Mitsubishi’s distribution capacity,Kim Eng’s equity research capability

Q1

Benefits

Maximize business

Share cost

Increase market share

Gain access to distributors

Reduce risk exposure

Mitsubishi and Kim Eng

• Decreased costs + increase in economies of scale

Q1

• Savings passed on to consumer = lower prices

• Increased market share and exposure-new markets

Mitsubishi and Kim Eng

Q2: • Any complications that may arise? • What might the result of these complications be? • Do you think this partnership will last?

Mitsubishi and Kim Eng

Q2

Complications may arise from

Cultural differences

Differences of opinion

May become one-sided

Advantages may diminish

Potential Complications

• Greater understanding, strengthening of alliance

Mitsubishi and Kim Eng

Q2

• OR end to alliance

• E.g. Cultural differences greater educationand understanding

• E.g. Becomes one-sided improve balance orend/discontinue alliance

Results of Complications

• Yes

Mitsubishi and Kim Eng

Q2

• Fairly large companies

• Clear agreements

• Mitsubishi’s investment in Kim Eng

Will the alliance last?

• Kim Eng- good reputation working with other companies

Symantec Middle East and Scanit

Q3: • How can this alliance be mutually beneficial? • Will this increase consumer desire to purchase

their goods and services?

Information security company

Security Services Company

Dubai-based company

Dubai-based company

Symantec and Scanit

• Can tap into each other’s strategic strengths

Q3

• Can offer wider range of services

Mutually beneficial

• Share costs

• Multitude of services– create new market

Symantec and Scanit

• One company to manage range of systems

Q3

• Cost and time management savings

Customer Benefits

• Locally based

• Cheaper, efficient customer support network

• Yes!

Q4: • Will this trend of forming international business

alliances continue?

• Why: Advantages- may enter a foreign market

• Also, share risks and expenses, share knowledge and gain competitive advantage

• Flexibility of strategy- range of alliance levels

Q4

• Small businesses can participate

• Growing need for alliances:

Increased competition

Need to operate on global scale

Changing marketplace

Industry coverage in markets

Advantages

Mitsubishi and Kim Eng

Q5: • Assess the formation of this alliance in terms of

the strategic factors for selecting entry modes

Factors

Cultural Environment

Production and Shipping Costs

Political and Legal Environment

International Experience Market Size

Mitsubishi and Kim Eng

• Entry mode = strategic alliance

Q5

a) Cultural Environment- Kim Eng’s extensive experience

• Cultural differences and existing relationships

Entry Modes

Mitsubishi and Kim Eng

b) Political/Legal Environment

Q5

• Kim Eng- identify risks, conditions

c) Market Size

Entry Modes

• locate potential markets- risks and growth

Mitsubishi and Kim Eng

d) Production/Shipping Costs

Q5

• identify cost-effective forms of production

e) International Experience

Entry Modes

• Kim Eng’s prior experience abroad

CIA 2010, ‘Japan: Economics’, Central Intelligence Agency, 21 April, viewed 8 May 2010, https://www.cia.gov/library/publications/the-world-factbook/geos/ja.html

Clark RL, Ogawa N, Kondo M and Matsukura R 2010, ‘Population Decline, Labor Force Stability, and the Future of the Japanese Economy’, European Journal of Population. Dordrecht: 2010. Vol. 26, Iss. 2; p. 207

Kwintessential 2009, ‘Japan - Language, Culture, Customs and Etiquette’, United Kingdom. Accessed on: 08 May 2010. Accessed via: http://www.kwintessential.co.uk/resources/global-etiquette/japan-country-profiles.html

‘Developments in individual member countries: JAPAN’ Organisation for Economic Cooperation and Development. OECD Economic Outlook. Paris: Nov 2009. p. 144

‘Japan’ World Economic Prospects. Oxford: Spring 2010. p. 27

Williams DE 2008, ‘Japan’ International Business Center Newsletter. Accessed on: 08 May 2010. Accessed via: http://www.cyborlink.com/besite/japan.htm

Case Study

Booz-Allen & Hamilton 2009, ’Strategic Alliances’, Small Business Notes. Accessed on: 10 May 2010. Accessed via: http://www.smallbusinessnotes.com/operating/leadership/strategicalliances.html

Flynn, F & Suzuki, I 2008, ‘Mitsubishi UFJ Considers Yuanta, Daewoo Investments’, Bloomberg, 12 May, viewed 10 May 2010, http://www.bloomberg.com/apps/news?pid=20601087&sid=a4ICdxzvNTO4&refer=home

Mitsubishi UFJ Securities 2008, ‘Mitsubishi Seals Strategis Alliance with Kim Eng’, Mitsubishi UFJ Securities, 22 February, viewed 6 May 2010, http://www.sc.mufg.jp/english/e_press/pdf/e_press20080222.pdf

Mitsubishi UFJ Securities 2008, ‘Mitsubishi UFJ Securities invests in Kim Eng Holdings Limited’s subsidiary, KE Capital Partners Pte. Ltd.’, Mitsubishi UFJ Securities, 8 August, viewed 6 May 2010, http://www.sc.mufg.jp/english/e_press/pdf/e_press20080808.pdf

Stenzel PL 2010, ‘Strategic Alliances’, Reference for Business, Encyclopedia of Business, 2nd ed., Advameg Inc. Accessed on: 10 May 2010. Accessed via:http://www.referenceforbusiness.com/encyclopedia/Sel-Str/Strategic-Alliances.html

Thomson Reuters 2007, ‘Kim Eng Holdings Ltd. And Mitsubishi UFJ Securities Co. Ltd Sign MOU on Strategic Alliance’, Thomson Reuters, 7 November, viewed 8 May 2010, http://www.reuters.com/finance/stocks/keyDevelopments?symbol=KEHS.SI&pn=3

Thomson Reuters 2008, ‘Kim Eng Holdings Ltd. Forms Strategic Alliance with Mitsubishi UFJ Securities’, Thomson Reuters, 21 February, viewed 8 May 2010, http://www.reuters.com/finance/stocks/keyDevelopments?symbol=KEHS.SI&pn=3

Sutton, M 2005, ‘Japanese Trade Policy and ‘Economic Partnership Agreements’: A New Conventional Wisdom’, Ritsumeikan Annual Review of International Studies, vol. 4, pp. 113-135.

Trevor Lloyd-Jones 2006 ‘Dubai company Scanit monitors airport security breaches’, Business Intelligence Middle East , 3 November, viewed 8 May 2010, http://www.bi-me.com/main.php?id=6414&t=1&c=34&cg

United Arab Emirates, 2010, ‘Symantec blocks average of 100 potential attacks per second in 2009’ 6 May, Accessed on: 09 May 2010 Accessed via: http://www.ameinfo.com/231816.html

Wild, J, Wild, K & Han, J 2010, ‘Selecting and Managing Entry Modes’, in International Business: The Challenges of Globalization, Pearson Education Inc., New Jersey, pp. 378-407.

Case Study

1. Demonstrate how to bow and greet a Japanese person

2. What does the ‘okay’ hand sign mean to Japanese people?

3. Why can it be considered bad for a Japanese person to smile?

4. What are two of the benefits of forming a strategic alliance?