Chapter 18

UMIT DEVECI – EMBA 2016

MGMT 910 - Strategic Management

Individual Assignment 5

Imagine your firm is considering entry into a new market (adding a new product, opening a branch office, vertical integration, etc.): 

1. Which market would this be? What are alternative courses of action (alternative locations, modes of entry, etc.)? (0 points)

A new market opportunity for SE Turkey can be producing busbar power distribution systems and cable trays locally in Turkey.

Currently EAE, a local manufacturer, is the market leader in Turkey with a market share of > 80%.

It also produces LV panelboards where also it competes with SE Turkey. And the 2nd busbar actor is again a local manufacturer, selling around 5-8% of the market.

SE also has a global offer whereas several times tried to launch in Turkey but failed. It is because you can not compete with EAE price and also since busbar is sold to project business, it is very normal to have revisions in the dimension, to which you can not respond quickly if your production facility is not close / local.

Based on the experiences, SE should focus on how to localize busbar production in Turkey. Two alternatives;

* Build a busbar and cable tray manufacturing plant as SE Turkey, can be in a partner facility

* Acquire one of the local actors and develop its process to SE standards.

2.   Compare and contrast the pros and cons for two alternatives. Make a recommendation to your firm’s board regarding these two alternatives. Make sure to consider the impact of a possible entry on the sustainability of your firm’s competitive advantage. (10 points)

Alternatives | Pros | Cons |

Build a busbar and cable tray manufacturing plant as SE Turkey | * Produce and sell same SE global offer with already available reference project completions * SE quality reputation | * Create everything from scratch * More OPEX compared to competitor until getting familiar with the business * SE global...