BACK TO CONTENTS
GLOBAL MARKETS
FOCUS 5
Q A
What insights did you get into how globalisation is being approached in China today?
“It has been fascinating to see how joint ventures are operated in China. For example, if you take the Shanghai Automotive Industry Corporation (SAIC), they have joint ventures with Volkswagen and General Motors. In their truck division they also have joint ventures with Volvo and Iveco.
Q A
Which trends stood out?
I’ve observed a trend in the past 10 years, ‘global focusing’, where organisations are selling off a major division in order to concentrate on a clearer product line and get rid of what would be considered a non-core business.
What this did was to provide an amazing array of very healthy, successful, profi table divisions that are available for purchase. These are very, very attractive to other global businesses with complementary offerings.
Fifteen percent of the companies that I interviewed had gone through one of these large transformational acquisitions. It gives you an instant global footprint, or can fi ll in an instant global void, if you are trying to go global.
Conversely, some companies have actually retrenched. They’ve said, ‘We’re not getting the global benefi t we need from being a global player. So let’s pick a region and dominate that region.’ Being a global business is actually very expensive in terms of systems, processes, management time and resources. There are very few companies in the world that have the resources to try to be a leader in 200 different markets.
© 2013 KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and a member fi rm of the KPMG network of independent member fi rms affi liated with KPMG International Cooperative, a Swiss entity. All rights reserved.
“SAIC rotates its senior executives and their middle managers from the different joint ventures. A manager, for instance, will be asked to work in General Motors for a couple of years. Then they will move them to Volvo and then on to Volkswagen. At the end of eight or ten years, you have a manager who has learnt best practices from some of the most well respected, well run and profi table auto manufacturers in the world - and they all work for the same company.
“This cannot be replicated in other companies, because most don’t have joint ventures with such a variety of partners. The result is an incredibly well qualifi ed and knowledgeable workforce. Chinese automotive businesses can now buy brands, confi dent that they will have the in-house knowledge needed to manage them successfully.
“The more brands that come up for sale, the more I expect to see Chinese fi rms, with the blessing of the Chinese government, start to become market leaders in certain automotive lines.”
Page 1 |
Page 2 |
Page 3 |
Page 4 |
Page 5 |
Page 6 |
Page 7 |
Page 8 |
Page 9 |
Page 10 |
Page 11 |
Page 12 |
Page 13 |
Page 14 |
Page 15 |
Page 16 |
Page 17 |
Page 18 |
Page 19 |
Page 20 |
Page 21 |
Page 22 |
Page 23 |
Page 24 |
Page 25 |
Page 26 |
Page 27 |
Page 28 |
Page 29 |
Page 30 |
Page 31 |
Page 32 |
Page 33 |
Page 34 |
Page 35