supply chain case final - Global supply Chain adaptation to entry China market by Cheuk Sze Wong Introduction Due to the raise of global business firms

supply chain case final - Global supply Chain adaptation to...

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Global supply Chain adaptation to entry China market by Cheuk Sze Wong 06/30/2013
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Introduction Due to the raise of global business, firms should definitely need to choose the right international marketing theory to achieve their growth objectives. The figures shows that emerging markets are the biggest factor that cause the future growth for many global companies. According to the International Monetart Fund (IMF), the average EM growth rate (GDP 2010 – 15) will be 6.65% compared with 2.5% in mature markets. The Economist estimates that 70% of global growth over the next few years will come from EMs, with about 40% coming from China and India alone. By 2014, IMF estimates show that EMs will account for the majority of global GDP. By 2040, China will be the world’s largest economy, while India, Mexico, Russia and Brazil will all feature among the 10 largest global economies. Significantly, 64% of executives expect that the majority of their revenue growth will come from EMs within three years. (Edwards, 2011) Literature review Contingency theory becomes one of the new theory used to view organization, it claims that there is no single structure is the best way to design for organizations. Instead, the structure should fits certain factors, in the enterprise management based on the internal and external factors of the company, specific to different conditions to decide different management models, programs, or methods. The core idea of Contingency theory identified different types of organizations are needed in different types of the environment, strategy, size and also under the uncertain conditions, the organization must be based on short and long term objectives and the prevailing conditions to decided appropriate management. Some level of the organizational structural variable to certain level of the contingency, which leads higher performance, whereas misfit leads to lower of performance. Lorsch and Morse (1974) did a research showed that, for high organizational performance, environment, organization, and member predispositions are the important factors has to be concerned. In other words, where the environment was low on uncertainty, employees were more comfortable being controlled, liked to work with others and had low tolerance for ambiguity. Conversely where the environment was high on
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uncertainty, employees would prefer autonomy and had high tolerance for ambiguity. Economic cluster theory is a theory of strategy. Alfred Marshall, in his book Principles of Economics, has mentioned, ''concentration of specialized industries in particular localities''. The theory states that there is less competition occurring and thus higher profits to be earned by firms. An unchanging customer base can maintain their business and steady income. According to Porter (1990), industry clusters are geographic concentration of interconnected companies, specialized suppliers and service providers, firms in related industries, and associated institutions (such as universities, standard
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