Comparative Analysis of Asia Pacific Multinationals Business Strategy

This essay provides a comparative analysis of multinational corporations (MNCs) from the Asia Pacific region, focusing on firms from Japan (Toyota and Hitachi), Korea (Samsung), Taiwan (TECO), and China (Huawei). The analysis covers core capabilities, corporate organization, the role of government, and overall strategy. It examines the global strategy aims of Japanese multinationals, the international business strategies of Chinese and Korean multinationals, and the competitive advantages these companies hold compared to their rivals. The essay highlights the importance of innovation, R&D investment, and strategic partnerships in maintaining competitiveness in the global market, while also noting the unique strengths and challenges faced by each country's approach to international business.

Running head: ASIA PACIFIC BUSINESS
Asia Pacific Business
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Table of Contents
1. Introduction............................................................................................................................2
2. Discussion..............................................................................................................................2
2.1 Japanese multinationals in electronic industry.................................................................2
2.2 Global strategy aims of Japanese multinationals.............................................................3
2.3 International Business strategic aims of Chinese and Korean multinationals.................4
2.4 The competitive advantages of these multinationals compared to those of rivals...........5
3. Conclusion..............................................................................................................................8
References:...............................................................................................................................10

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1. Introduction
This paper shall assess and evaluate the MNCs (Multinational corporations) from
different countries and would made a comparison of the leading Asian Pacific economies.
The main aim of this paper is to summarize the five firms belonging from the Asian Pacific
Multinationals. The chosen firms are Toyota and Hitachi Corporation from Japan, Samsung
electronics from Korea, TECO from Taiwan and Huawei Technologies from China. This
paper shall assess these firms on the basis of four different aspects and they are core
capabilities, corporate organisation, role of government and strategy.
2. Discussion
2.1 Japanese multinationals in electronic industry
From decades, the Japanese electronics industry has remained the most innovate and
richest sector in the global electronic markets. Toyota Motor Corporation, an organization of
Japanese origin, was founded in the year 1937 (Miyakawa 2017). The function area of the
company is manufacturing, assembling, sales of passenger cars, designing, minivans,
commercial vehicles along with selling of accessories and all associated parts in North
America, Asia, Europe and Japan. They have promoted their primary goals of developing
better cars than before by continuously developing their gifted workforce. In order to do so,
substantial changes has been made by Toyota in the fiscal year of 2016 in its structure. This
has facilitated in developing an organization that is more focused on products and not on
functions. India is a very crucial market for Toyota. With the same, it is also regarded as the
most trustworthy and safest brands on the market. There is no other automaker in the market
that has reputation of durability like Toyota. With the same, it is also to note that the vehicle
of Toyota costs very less to purchase, maintain and to buy. Furthermore, it has also continued
to grow in the complex and sophisticated of Europe as well. It has also delivered more than

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10 million cars to the customers in Germany. Similarly, Hitachi was founded in the year 1910
by Namihei Odaira as a shop for machine repair at the company named Kuhara Mining which
was located in the Hitachi City of Ibaraki Prefecture in Japan (Trappolini 2014). The mission
of this firm is to create innovative technology which serves the needs of the customers and
differentiates the technology of Hitachi- operating under a technology driven innovation
model. They are operating under a vision driven model of innovation, pioneering the new
businesses through undertaking the R&D so as to resolve the future societal issues. Hitachi
group, on the other hand, operates all-round the globe with its huge number subsidiaries and
companies in several different business generating revenue of more than 10 million yen. With
the same, the R&D, the IT department along with its front-end sales team are helping it in
bringing in diverse expertise. Furthermore, this company make use of IoT and this has helped
it in integrating the manufacturing facilities and the IT industries resulting into the
optimisation of the value delivery system.
2.2 Global strategy aims of Japanese multinationals
Increasingly, the primary goal of the Japanese multinationals while developing global
strategies is focusing on cooperation and competition in the Asia Pacific region. Due to
increasing incomes and continuous growth in this region, Japanese MNCs are focusing more
on the political and the business developments in Asian region. Due to the background of
historical differences and economic rivalry on how Japanese view investment and trade
policies, there is a rise in tension (Sunley and Martin 2017). Through the period of post-war,
the Japanese FBI in the Asian countries has not been able to gain prominence in the market
when market competition is considered (Hasegawa 2018). The year of 1970 saw the countries
in Asian Pacific region change their strategies of growing by focusing of export. This new
strategy forced the Japanese MCS began to invest aggressively on exports. With the same,
this multinationals have also focused on the investments related to natural resources in

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Indonesia as well as finance investments and distribution in Hong Kong. Also, the makers
belonging from the Japanese electronics industry have focused on making early investments
in the Asian local markets for serving the customers. In the mid-1970s, these electronics
companies moved their production of some of the products that have matured like white and
black televisions to Asia so as to bypass the barriers in trade of U.S to the exports of Japanese
organizations. At present, the Japanese electronics MNCs like Hitachi Corporation and
Toyota has moved towards more unsegregated systems of production.
2.3 International Business strategic aims of Chinese and Korean multinationals
Rising from the obscurity twenty five years ago, the Korean MNCs under electronic
industry have come to own a notable share of the electronics market of the world today. The
Korean multinationals aims for ultimate self-reliance in the field of technology innovation
(Munro 2018). The key strategy that it uses for remaining competitive in the international
market is of engaging in the joint ventures. It helps them in maintaining the flow of
technology with the top foreign companies, mitigating the impacts of the growing domestic
labour costs, distributing the costs of R&D, contributing to the advancement of the human
beings and securing favourable trade agreements. The Samsung electronics of Korea is
investing in Europe since the year 1982 (Cherry 2017). It is at present operating in 34
different European countries and has gained a revenue of 34 billion dollars as per 2014. It has
a total of 41 offices there and has 14,000 employees working in those firms. It is considered
to be the market leader and the most preferred brand in Europe and is leading in the
categories of Television, tablet, refrigerator, mobile phone, hospitality display, large format
display and semiconductor. They have their R&D centres all across the Europe that is looking
towards the emerging lifestyle trends in order to meet the growing aspirations of the people
right from the entry-level to the aspirational level. It is always driving innovation throughout
28 member states of Europe.

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Furthermore, innovation plays a noteworthy part in the business strategies of the
Chinese multinational firms. For example, the Huawei Technologies of China that is
specialised at manufacturing and designing the telecommunication routers and equipment has
begun to challenge the multinational CISCO of U.S that is the global market leader
(Carpenter and Lazonick 2017). The core value of Huawei are its core competencies. They
want to inspire dedication by remaining focused on being customer centric. The Chinese
electronic industry has huge R&D pool. Huawei invests about 10 to 15% of its total revenue
in the Research & Development yearly. In the year 1997, Huawei has started engaging the
leading Western consulting companies in order to build a management system that is process
based. It is at present operating in 170 different countries and is serving 3 billion people. It
has also built a total of 1500 networks. Its targeted breakthrough areas are the ultra-low
network and cost effective broadband.
2.4 The competitive advantages of these multinationals compared to those of rivals
Samsung is considered number one for its design globally. However, it is facing
major challenges in recent years. These challenges are due to urbanisation, ageing population,
female empowerment, changing households, tech democratization, internet, growing
autonomy, middle-class expansion, and access to economy, mainstreaming m-commerce,
polarisation, economic shifts, resource scarcity, water and air safety, governmental
regulations, the growing environmental regulations and the greater stance on privacy.
Notwithstanding, Samsung is helping the young people of Europe to experience the way in
which digital skills can open up new doors for them. It has a very strong commitment to the
R&D (Yu et al. 2017). It always look forward to search the needs of their customers ahead of
their rivals. They find the demands of the customers. The group of engineers of Samsung
always try to develop products that are innovative and innovative, and would fulfil the needs
of their customers. With the same, as Samsung is continuously trying hard to enhance their

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spending in its Research & Development and its obligation to being the foremost technology
standardization as well as safeguarding the rights of intellectual property. Furthermore,
Samsung is a company that combines the American and Japanese strategies to make its one
of its own (Hu et al. 2015). The Japanese MNEs basically like to provide multiple products to
their customers, while the American companies are focused more on the small range of
products (Chakravarthy and Yau 2017). By combining two of these strategies, Samsung is
using both vertical and horizontal integration. This in turn means that Samsung is the
company that has been diversified with a wide range of products and is also specialised in
manufacturing at the same time. With the same, they also have a very strong patent portfolio.
In USA, Samsung is considered to be the 2nd largest patent holder (Rubenstein 2017). It holds
a total of 36 R&D centres all over the world so that it can secure the core technologies for the
coming future. Along with these, it is also to note that Samsung holds a solid financial
position.
The MNEs of China are competitive due to the fact that the technology,
equipment and capabilities that are suitable for the poor are the foundations that are uniquely
rooted in the unlimited supply chain of China. These MNEs are willing and holds the
potential to engage with the poor. Furthermore, there is always financial and political support
by the part of the country and this indeed is a great advantage. With the same, there is higher
efficiency, disciplined, centralised management and hardworking labour forces in China with
comparatively low pay generate margins. Moreover, Toyota is considered to be the best-
selling brand in Japan and it offers more 4WD and AWD options to its customers that any
other non-luxury brands present in the market (Erjavec and Thompson 2014). With the same,
it is also to note that the vehicle of Toyota costs very less to purchase, maintain and to buy.
With the same, it is also regarded as the most trustworthy and safest brands on the market.
There is no other automaker in the market that has reputation of durability like Toyota.

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Furthermore, speaking about investment, the vehicles of Toyota rank high in resale value and
this means that if an individual do not want to drive the same car for 15 years, he can sell it
and can trade it as well. Furthermore, Toyota is always considered to be the leading in the
automobile industry in terms of eco-friendly features as well as green technology for decades
(Yu et al. 2017). Thirdly, Hitachi group operates all-round the globe with its huge number
subsidiaries and companies in several different business generating revenue of more than ten
millions yen. However, to this context, it is also to note that although Hitachi group operates
worldwide, its main share of revenue comes from Japan and that is of 52% and from the
Asian markets, i.e., of 21% as per the data of 2016 (Starrs 2017). With the same, the R&D,
the IT department along with its front-end sales team are helping it in bringing in diverse
expertise. Furthermore, this company make use of IoT and this has helped it in integrating the
manufacturing facilities and the IT industries resulting into the optimisation of the value
delivery system. Apparently, Taiwan is one among the 4 Asian Tigers right from the early
seventies. Its GDP per capita is more than twenty thousand USD. It ranks 15th in the
international trading and is a very important partner in the Information Technology industry.
The core products of TECO are Medium size high voltage motors, medium size low voltage
motors and small size low voltage motors (Kulkarni and Keister 2016). The major
achievements of TECO is that it has achieved global market share in the global top five
motors. Its significant projects are the Georgia Aquarium Project, the Dubai Airport
Expansion and the Las Vegas Water Treatment facilities.
Again, Huawei of China is widely known for its formidable business moat which no
small companies could cross. It is a known fact that in this era of growing use of internet and
technologies. However, in the telecommunication industry, there are fewer number of players
than ever before. Basically there are a total of five vendors and they are namely the Cisco,
Ericsson, Huawei, ZTE and Nokia (Joo, oh and Lee 2016). Along with the prosperity of

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information, the larfe traffic needs vendors to put large investments into the R&D and
manufacture the leading telecom infrastructure. Once the vendors take large share of market,
they could enjoy the expansion of network profits each year. The telecom industry is
regarded to be capital intensive and hence it is hard for the small companies to enter into the
market. Huawei invest a huge amount of money into the strategic area in order to provide
competitive technology as well as to boost its growth of business. It is also to note that
Huawei is based on the E2E process in order to make sure a long lasting business success of
it. Huawei offers its customers excellent quality of products and the local service team
(Erjavec and Thompson 2014). Its core value is to stay customer centred as well as inspiring
dedication. It provides every employee of it’s a one week training regarding the core value
and the culture of the Huawei. Furthermore, one of its significant features that is aiding to its
competitive advantage is it customer dedicated customer service team. They consider the
requests of the customers to be of utmost important. Each of the frontline of Huawei are
allowed to directly call the boss of R&D so as to assist for solving the problems of the
customers. It is also to mention that the labour costs in Huawei is also very low and it is
focused on a long term growth. With the same, the highly efficient supply chain of Huawei is
also one of its key competitive advantage (Hu et al. 2015). It has built many supply chain
centres in America and Europe and when any customer place any order, the Huawei through
the help of these centres could manufacture and deliver the products directly to the customers
within very short period of time.
3. Conclusion
From the above analysis it is clear that while the Korea and Japan previously had a
larger roles, recently china seems to pushing forward. Japanese electronics industry is always
considered as the highly innovative sector in international markets. However, in the recent
years, it is losing its traditional advantage over its rivals and it has become reluctant for

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implementing the hard choices and changes that is needed in order to remain competitive in
the international market. Taiwan is one among the 4 Asian Tigers right from the early
seventies. Its GDP per capita is more than twenty thousand USD. With the same, it has also
been concluded that Asian Pacific region is greatly diverse in regards to the cultures, levels of
income, political economic approaches and resource endowments. The strategy of these
companies, their corporate organisations and the core capabilities are effectively and
successfully helping these firms to operate well in the local as well as global markets.

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