Rodamas Group: Designing Strategies in Erging Economies

1648 Words7 Pages
Indonesia
 Indonesia
is
a
vast
archipelago
with
a
population
of
around
240
 million,
and
has,
over
the
years,
 experienced
significant
growth.
 Local
partners
were
essential
to
manage
the
appropriate
 connections
in
a
country
that
was
 rapidly
developing
but
which
still
suffered
from
weak
 infrastructure,
law
enforcement,
and
rampant
 corruption,
making
every
aspect
of
operations,
including
obtaining
 permits,
buying
land,
hiring
personnel,
 procuring
inputs
and
distributing
products,
a
challenge.
The
 cultural
diversity
and
geography
for
example,
 with
hundreds
of
languages
and
islands,
made
it
hard
to
distribute
 products
and
effectively
market
them.
 The
low
disposable
income
compared
with
the
large
population
 meant
that
there
were…show more content…
His
son,
Tan
junior,
continued
this
 attitude,
which
is
ingrained
in
the
company
culture.
 Political
changes
 • The
Asian
Crisis
also
brought
down
Suharto
and
he
 was
replaced
with
a
new
regime
with
anti‐corruption
 and
anti‐Suharto
overtones.
 • In
April
2007,
for
example,
a
new
presidential
 regulation
was
passed
that
allowed
100
per
cent
 foreign
ownership
in
most
sectors
of
the
economy
 except
public
infrastructure,
and
the
government
 actively
promoted
foreign
investment,
which
had
 fallen
to
much
lower
levels
than
before
the
Asian
 Crisis.
Some
foreign
companies
already
operated
 without
a
partner.
 Under
these
changing
local
and
global
conditions,
what
would
be
 the
role
of
Rodamas? • The
company’s
capabilities
would
allow
it
to
produce
 simple
products
which
could
serve
the
indonesian
 market
 • Rodamas
did
not
benefit
from
knowledge
transfer,
as
 technology
was
proprietary
and
owned
by
its
 Japanese
partners.
To
start
for
himself
in
an
area
that
 was
low‐tech
and
relatively
easy,
Tan
was
toying
with
 the
idea
of
entering
the
property
sector.

 Other
Options
 • The
other
option
was
to
move
into
labor‐intensive
 manufacturing

 • Internationalization
via
foreign
direct
investment
was
 also
a
long
shot.
The
company
lacked
the
necessary
 human
resources
to
establish
a
base
in
foreign
soil
 and
compete
successfully,
but
on
the
other
hand,
the
 economic
crisis
worldwide
did
offer
opportunities
 otherwise
not
available.
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