WRSX China Expansion Strategy: An Analysis with Board Meeting Insights

This report provides a comprehensive analysis of WRSX's strategic decision to expand into China, incorporating PESTLE and SWOT analyses to evaluate the external and internal factors influencing the company's operations. It delves into the political, economic, social, technological, environmental, and legal aspects of both the UK and China, highlighting opportunities and threats associated with the expansion. The report also reflects on the decision-making process during board meetings, discussing the influence of various factors on the final strategic choices and the results achieved. Key considerations include diversifying losses post-Brexit, exploiting resources in China, and addressing competitive challenges. The analysis further examines the impact of these decisions on WRSX's financial and non-financial performance, concluding with a personal reflection on the simulation and module contents.

Running head: EXPANSION INTO CHINA
EXPANSION INTO CHINA
Name of the Student:
Name of the University:
Author Note:

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Table of Contents
Part A:..............................................................................................................................................2
Overview of WRSX.....................................................................................................................2
Overview of the industry.............................................................................................................2
Strategic tools used......................................................................................................................3
Strategic choices..........................................................................................................................8
Reflection on decision making process.......................................................................................9
Influence of decisions during board meeting.............................................................................10
Results achieved........................................................................................................................10
Influence of decision for original strategic choice....................................................................10
Part B: Reflective essay.................................................................................................................11
Reflection on computer simulation:...............................................................................................12
Appendices:...................................................................................................................................13
References:....................................................................................................................................19

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Part A:
Overview of WRSX
WRSX is one of the leading advertising and media relationship companies with its
headquarters in the United Kingdom. The merger of Waldron Riux Silberstein Xao formed the
company, a London based advertising agency with Silberstein& Lord based in New York, the
United States of America and Roux Toussaint Berthe based in Paris, France. The timeline of the
present company shows that is a public limited organisation with its primary listing on the
London Stock Exchange. The product line of the company consists of advertisement services
for its clients, media advertising, direct marketing, public relation and communication
servicestailor-made for customers. The company in order to strengthen its product line acquired
firms from related industries like film production and sports marketing. The main clientele of
the firm consists of global players from logistics, health & pharmaceutical,
telecommunication, beauty, personal care, public sector and charitable organisations. The
value addition strategy of WRSX consists of offering clients with creative and innovative
promotional services of their products. The mission of the company is to maximise the values of
the brands owned by its clients from different industries.
Overview of the industry
The advertisement industry is an international industry spanning the entire globe, which
is worth billions of dollars today. The primary product of the advertisementindustry includes
creation and strengthening of brands of companies across diverse industries. The actual
products of the advertisement industry are the advertisements, which are visible to the
consumers while the augmented product consists of the brand equity maximisation, which the

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companies gain (Conley 2017). The main aim of the advertising industry is to promote products
in the market to create awareness among the consumers. The players in the industry range from
small non-profit making organisations to Fortune 500 companies like London based WPP Group
worth $19 billion. The smaller players mostly serve local small-scale firms while the
international advertisement companies serve multinational companies. Today promotion has
emerged as one of the main activities multinational companies carry out to strengthen their brand
equities and maximise their revenue generation. This increasing importance of promotions hasled
to markets like the United States of America and China spend immense amount of
money(statista.com 2018)(Appendix 1).The advertisement industry comes heavily under the
influence of macroeconomic changes and changes happening in the other industrieslike fast
moving consumer goods and pharmaceuticals. The market issues like economic slowdown in the
developed markets have led the companies of these markets curtail their advertisement costs,
consequently causing fall in revenue of the advertisement companies in these markets. Again, the
booming economies are experiencing their companies boosting their advertisement activities.
Thus, the advertisement companies in these countries are experiencing increase in revenue (Shen
et al. 2016). The recent trend in the advertisement industry in response to this trend is increasing
their presence in the emerging markets like Asia. (Couldry and Turow 2014).
Strategic tools used
The political factors are the most important factors, whichinfluence the operations of
business organisations. The political factors consist of government policies, which form the basis
of the policies and modus-operandi of all the industries. As far as political condition of the
United Kingdom is concerned, one can point out that the country is politically stable under the
leadership of Mrs Theresa May. The country has strong bilateral ties with the major countries in

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the world, which would allow the firms based in the country to expand into these markets. As far
as the political factors of the target market, China is concerned;London has strong relationship
with Beijing (Draper 2017).This relationship is evident from increasing presence of British
companies in China. The companies from this country in turn follow the suit by opening
branches in Britain. Moreover, the present host countries of WRSX, the USA, Singapore and
France too are increasing their ties with Beijing (business-standard.com, 2018). Expansion into
the Chinese market in a strong way would enable WRSX diversify the losses it would suffer post
Brexit. Expansion into Asia would usher several economic advantages like more market and
consequent revenue generation (bloomberg.com. 2018). However, Chinahas its own political risk
factors, which WRSX needs to consider. The economic development in the main Asian markets
like India, China and Japan has triggered arms race, which have created tension among these
countries. Terrorism poses a continuous threat to the economic stability of the Asian nations just
like the US and the UK (washingtonpost.com. 2018) (Appendix 2). The analysis of the political
conditions of Britain and the China shows they have their own political strengths and threats.
One can also point out that China has its own political opportunities and threats. These market
opportunities of China further influenced me to convince the directors pursue the strategy and in
the second board meeting on making strategies to reduce client turnover.These advantages of
China would eventually make the board opt for the country as its next important market.
The economic factors of Britain as I can point, which influence the operations of the
companies based in Britain, consist of both opportunities and threats. The first economic
advantage, which advertisement companies enjoy, is her high rate of GDP
(tradingeconomics.com. 2018) (Appendix 3). The high GDP in my opinion means that industries
in the country are booming and would require more promotion of their products to boost their

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revenue. This growth in demand would translate into more business generation for WRSX.
London provides the companies with immense investment and sourcing of funds for operations
(statista.com 2018) (Appendix 4). This provides the financial strength to the business
organisations including WRSX to operate in Britain and expand into other markets. The third
economic advantage of the British economy is the international value of Pound in the currency
market. The value of GBP compared to Euro shows an increasing trend (bloomberg.com. 2018)
(Appendix 5). This means that the advertisement company can import resources at lower rates
and export services at higher rates, thus earning higher revenue. However, post Brexit, the value
of GBP may fall leading to increased expenditure of the companies based in Britain (ft.com.
2018). Brexit is also influencing the entire share market in the UK, which is again a threat for
WSRX since it is a public limited company dependent on the share market for its capital
generation. Thus, strengthening of market position in China has become crucial to counteract this
impending threat of Brexit. The first economic advantage, which the emerging economies of
China would provide, is its vast resources. China has several multinational companies, both
resident and international, which would provide strong clientele to the advertisement company.
Moreover, the advertisement company would be able to exploit the human resources in the
country, thus supplementing the human resource it would have to cede in Europe post Brexit to
cut costs (Tung 2016).This aspect was covered in the second board meeting and it was decided to
outsource some operations. The next advantageous factor, which British companies can exploit
in China, is strong presence of British financial institutions in the market. Thus, they would be
able to use their European account in China, which would make fund transfer between its British
and Asian units easy (Aguilera-Caracuel et al. 2015). China too hasits own economic challenges,
which the advertisement company needs to consider. The fourth board meetings revolved

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around these competitive factors and it was decided to incorporate competitor strategies in
business plans. I can recall that the consideration on the economic factors in China led to the
formation of new employment policies in the fifth board meeting. The country gives more
preferences to their resident companies and makes preferential laws to encourage their
development. These markets owing to their economic development already have resident
advertisement companies, which would pose threat to the British advertisement company (Gilpin
2016).
The social factors would influence the advertising company since the society is the end
customer of the advertisements. The GDP in Britain and China are rising which means people in
these societies have more disposable income. Moreover, China and Britain are experiencing
population growth, whichmeans expanding consumer bases. The business organisations as a
result are strengthening their promotions to tap this customer base. This means advertising
companies would find a huge clientele and sources of revenue in China. However, the
marketisculturally diverse from the United Kingdom as per Hofstede’s tool (hofstede-
insights.com. 2018) (Appendix 6). This means that the advertising should design their
advertisement presentations to suit these social perceptions and attitudes in these markets.
The technological factors would be of great importance to WSRX advertisement is a
technology is a technology intensive product. Britain is technologically very advancement while
Chinais developing its technological strength fast. The threat, which every business organisation
faces in Britain, as well in the developing Asian markets is the threat of data theft. The business
organisation must strengthen its data protection facilities while sharing data among its offices in
Europe (London, Paris), the United States of America and the Asian offices (Westerman, Bonnet
and McAfee 2014). I can point out that the advertising company can use the ecommerce in China

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to promote its services and offer services to customers round the clock. This market advantage
which is present in China encouraged me to influence the board the direction.
The environmental factors are of great importance to every company especially with the
strengthening of environmental laws all over the world. The advertising company must aim to
reduce its exhaust output and wastes during operations. For the companies operating in Britain
have to abide by laws like Environmental Protection Act 1990 (legislation.gov.uk. 2018).
Similarly while operating in China; the company have to abide by the Environmental Protection
Tax Law (loc.gov. 2018).WRSX must also abide by the legal systems of both the UK and China
to operate smoothly in these economies. The company must abstain from resorting all sorts of
corruptive practices while operating in China.The subsequent board meetings should revolve
around the operating in China profitably and staying away from corruption.
WRSX requires conducting a SWOTanalysis in the light of the PESTLE analysis to form
strategies to expand into Asia (Appendix 7). The overview of WRSX shows that its strength lies
in its international presence in Britain, France, the United States and Singapore. The company is
a public limited company listed on LSE and can generate capital the market. However, Brexit is
likely to raise the cost of its European operations and Singapore is insufficient to tap the entire
Asian market. The company must expand into other emerging Asian nations like China as well to
exploit their resources and diversify the losses it would suffer post Brexit (Wan, Cai and Zhou
2015).
The Porters five forces model in analysed in terms of WRSX shows that the firm would
operate in two capacities (Appendix 8). WRSX is a resident company in Britain where the
British government would make laws to restrict entry of foreign companies. Since, it is a British

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company; it would have more knowledge about the macro environmental conditions of the
country (PESTEL). The companies in Britain would opt for its promotional services compared to
its foreign counterparts. Thus, it would enjoy more bargaining power in Britain compared to the
foreign advertisement companies. The situation would reverse when the company would venture
into Asian countries like China (Riasi 2015). The governments of these countries on make
preferential laws to promote their resident companies. The clients in these markets would prefer
resident advertisement companies to foreign companies like WRSX owing to better knowledge
of the former about the customer preferences and social factors like culture. Thus, in the Asian
market WRSX would enjoy less bargaining power compared to Britain. An analysis of the
PESTLE, SWOT and Porter’s model clearly points out that a stronger presence in Asia is
empirical to counteract the future challenges of Brexit. The analyses that Asian markets like
China present vast business opportunities and challenges simultaneously. These factors require
the company to make strategic choices to expand into Asia (Porter and Kramer 2019).
Strategic choices
The markets of Asia according to my learnings are booming and are capable of providing
revenue to diversify the losses British companies are predicted to face post Brexit which would
require the company to make three strategic choices. The first strategic choice would be
regarding the countries the company would expand into countries like China. The PESTLE
analyses have influenced my decision strongly thus leading me to conduct the company’s own
SWOT analyses based on outcomes of PESTLE. The performance of WRSX would be judged on
financial performance indicators like profit and non-financial indicators like goodwill (Kordalska
and Olczyk 2016).

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The second strategic choice after screening the market to enter would be product line
extension. WRSX should reframe or extend its product line to suit the tastes of customers in the
chosen market of China. This would result in benefitting situation both for company and the
customers in the new market.The company should integrate this strategic choice with its third
strategy, integration of globalisation and localisation in its product line extension strategy. The
international status of the company would enable it to attract MNC companies as its client
(Rodriguesand Khan2015). Again, the WRSX should incorporate features typical to the Chinese
culture so that the people in China can relate to the advertisements. The expected outcome of
these strategies would be in my opinion high market performance of WRSX in the Chinese
market. The financial results achieved were increase in clientele and increase in profits.
The non-financial outcomes of the Chinese business would be enhancement of goodwill and
market position.
Reflection on decision making process
I while making decisions and using them to influence the board meetings reflected on the
macroeconomic conditions of the UK and juxtaposed them against China, the target market. The
other managers who had knowledge about China have also influenced our decision making. The
tools considered to make the decisions consisted of PESTEL, SWOT and Porter’s Model
(Andrejevic 2014). The benefits like China’s vast market, low cost and opportunities to
diversified risks played important role in shaping my decision to prefer China as the new
prospective market. The management weighted these pieces of information gathered along with
the alternatives and finally China was opted as the market of entry in the first board meeting.

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Influence of decisions during board meeting
During the board meeting, the decisions taken by me were entirely based on the research
of the external and internal factors and the trend with which the share price increased. The
financial performance of the company indicates that it had earned a hike in the revenue scheme
and has resulted in the increase in gross profits. The mater of providing flexibility to the work is
more of the demand based on the trends in the market. Recent market demands that as a manager
of the modern era it is necessary that I remain flexible in setting up business camps for the
welfare of WRSX Group.
Results achieved
The results that have been achieved in the matter of finance and non-finance indicates
that the company underwent profit. The meetings indicate that the average growth in the non-
financial department is also high. The only drawback that can be seen from the analysis of the
board meetings is that the CSR activities of the company have dropped by one percent in the
fifth board meeting. In my opinion, this can be a concern for the managers as CSR is one of the
important organisational activities that are needed to be undertaken.
Influence of decision for original strategic choice
At the start of the board-meeting phrase, I had initiated that external factors that have an
impact in the setting up of the company be analysed with caution. However, the improved
decision-making activity with the board member sessions has opened up opportunities to
mitigate the external threats in the market by making influential marketing decisions. These
decisions include improving the financial position of the organisation and including policies that
are more family friendly. Furthermore, flexibility provided to the working condition in the
organisation is also an influential decision that is undertaken.

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Part B: Reflective essay
I can reflect upon the board meetings and seminars I have attended and point that that
they have important contribution to my learning. The first board meeting clearly points out the
future strategy of WRSX to enter China along with consideration for the challenges the market
would present before it. This agenda is supported by the agenda adopted by the second board
meeting, the objective of reducing customer turnover. The third board of great significance
because it consists of future human resource strategy WRSX would adopt in China like
outsourcing. The fourth board meeting concentrates on considering competitor strategies while
making strategies, right from the apex level. The fifth board meeting was on employment
policies to be adopted to adopt to the changes in business operations and expansion into China.
The last board meeting was on increasing growth opportunities for the company. I can reflect on
the board meetings and point out that they are actually steps of change management shown from
the top bottom view. The first board meeting was the torchbearer of the change management
where it was decided that WRSX would be entering China besides being present in Singapore.
The subsequent board meetings were actually advancements towards the change like outsourcing
a part of the Chinese operations and the human resource policies.
These contents like the board meetings have helped me to shape my strategic decision
making capabilities. I have realised that human resource are one of the most significant
stakeholders of business organisation and successful change processes require strong support of
employees. The business organisations need to hold board meetings to decide this allocation of
employees to align them to the future business requirements. I have also learnt that
macroeconomic environmental conditions have very important implications on the business
decisions of the organisations. I have gained knowledgethose opportunities to enter new markets

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present immense business opportunities. However, they present new challenges owing to the
particular market conditions of different countries. They also call for business organisations to
change their modes of operations including resource allocations. These decisions have to be
taken at the apex level to ensure their successful enforcement in the organisations and
acceptances art all levels.
Reflection on computer simulation:
Computer simulation has added tremendous value to the studies revolving around
strategic management. The presentations of the board meetings are extremely realistic due to the
use of simulation tools. They help business schools to create realistic situations among the
students during study of project management. I can point out that the presentations of WRSXas if
meetings are lifelike which has helped me to imagine that I were present at the board meetings.
This perceptions enforced better understanding of the simulated situation of entering China,
which enabled better analyses of PESTEL and SWOT. This helped to form more concrete
strategies regarding the extension of company into the Chinese economy. These online
simulations like Hofstede’s tool help understanding culture of the new markets, which in turn
would help me to form more marketing strategies. I can point out that these simulations have
made strategic management more challenging which encourage learners and researchers to
brainstorm and come up with new ideas. Thus, I can point out that simulations enable graduates
to sharpen their managerial skills. Simulations create a feeling of virtual group work, which
helps candidate hone their communication and teamwork skills. Thus, simulations enable
management students development their managerial and strategy making skills.

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Appendices:
Appendix 1: Advertisement spending in top markets in million USD

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Appendix 2: Map showing terrorist death since January 1, 2015:
Appendix 3: GDP of Britain 5 years:

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Appendix 4: Number of branches of leading UK based banks in 2017:

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Appendix 5: GBP to Euro 5 years exchange rate graph:
Appendix 6: Hofstede’s tool comparison of three Asian countries vs the UK

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Appendix 7: SWOT of WRSX:
Strengths: Weaknesses:
1. The company has operations in Europe
(UK and France), the US and Asia
(Singapore).
2. Listed on LSE, can raise capital from
stock market.
3. Product line to suit needs of diverse
industries like automobile and
pharmaceutical.
4. Huge revenue.
5. Able leadership
1. Brexit
2. Strong competitors
3. The Asian market is to big to be
controlled from Singapore
Opportunities: Threats:
1. Expanding into other Asian countries.
2. Take advantage of growing corporate
sector and macroeconomic factors of
Asia to expand (PESTLE analysis)
3. List on other stock exchanges like
NYSE and Shanghai Stock Exchange.
1. Terrorism.
2. Arms race in Asia-Pacific regions.
3. Development of indigenous
advertisement companies
Appendix 8: Porter’s Five forces of WRSX:
Threats of new entrants: Threats of substitutes:
1. Propensity of clients to
Bargaining power of

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1. Barriers to entry
2. Government policies.
3. Customer loyalty
4. Product differentiation.
substitute.
2. Availability of
substitutes.
customers:
1. Buyer concentration
vsfirms’ concentration
ratio.
2. Information available
to buyers.
3. Buyer price sensitivity.
Bargaining power of suppliers:
1. Substitute available.
2. Distribution channel
strength
Industry rivalry:
1. Competitor companies like advertisement companies
based in Asia.
2. International advertisement companies operating in Asia

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