Case Study Of Asian Companies: Hitachi And Huawei

Hitachi

As being the largest electrical machinery manufacturer in Japan and also a leader in the semi-conductor production, Hitachi group prides in more than twenty thousand products and listed as the top 30 largest group in the world. The diagram below shows Hitachi's distribution of shares and revenue by region.

Hitachi's governance is defined as a company with a nominating committee, this also means that the nominating committee has the role of evaluating the board's performance. Hitachi's governance is structured in a way of which management are subject to transparency as well as enabling the group and subsidiaries to be enhanced equally by serving in both headquarters and subsidiaries as directors.

In the 1950s, the 2nd president of Hitachi, Chikara Kurata brought not only Hitachi into an new era of development in the global market but also the Japanese science and technology industry; establishing the Kurata Grant also in accordance with the "Fifth basic plan of science and technology" that was introduced by the government of Japan aims to provide incentives to researchers in the field of Energy, Urban development and Healthcare as to parallelly expand Hitachi's technological reach as well as achieving the goal of the government.

Hitachi in 1961 also signed an agreement deal with RCA of America in a strategic alliance and exchange of technology which further propelled Hitachi's investment in the computer research, which was later proved to be successful and emerging as the world's leading manufacturer of complicated statistical computer. Governmental support was observed through Japan's Ministry of International trade and Industry (MITI) as it controlled all the patent rights, export, and import of foreign countries and joint ventures. MITI propelled Hitachi through developmental programmes in which some scholars identify as forcefully or some identified as nurturing; in favor of Japanese firms including Hitachi to close the gap between the global market and Hitachi's technological advances. The Japanese government also serves as a guarantor for Japanese firms in effort to gain trust of foreign companies.

Hitachi is highly regarded for its consistency in catching up with the US counterpart, IBM, displaying hard work, flexibility and adaptation/ modification. Furthermore, the hard work was also portrayed in the 1974 oil crisis which employees of Hitachi took fifteen percent pay reduction which paid off in sales and revenue in the following year.

Huawei

During the 1980s as the Chinese government set out to bring in telecommunication capabilities from foreign firms; witness the rise of Huawei under the leadership of Ren Zheng Fei's strategy of reverse engineering. Although Huawei functioned as a privately owned company, it was observed that Huawei also received support from the government in form of land contribution and contract/regulation assistance, Huawei then eventually became the largest Chinese mobile phone producer in the world. Huawei which was observed to have jumped over a few stages and landed on an advanced stage of internationalization in a rather quick pace. Huawei witness a soar in exportation in revenue reaching shy of 40 billion dollars globally in 2013.

The corporate structure of Huawei is further illustrated in diagram below. Huawei's governance includes a 3 level of organization in which illustrated in the diagram above. Huawei has also adopted a hybrid a centralized governance in which the CEO and BG locate strategically in China and decentralized functional groups as stated above; in field offices of various foreign countries focused on adapting and gathering data and experiences from these field offices.

Huawei, as observed by scholars, adopted an imitating and latecomer strategy of global key players such as IBM and Apple of America. Huawei consistently learns through partnership and joint venture in adaptation to technology and production in their products. An example of which through partnership with IBM acquiring experience for Huawei in supply chain management, production, and logistics.

One of the leading causes for the rise of Huawei is further notice in the initial opening of China's market to foreign competitors establishing Huawei's motivation to surpass these foreign manufacturers such as Motorola and Nokia. Huawei adapted and compete in its capability to differentiate its product from competitors, making product very difficult for them to copy in this highly competitive market in an example of partnering exclusively with Leica incorporation of their technology in Huawei's phones. This also demonstrated the value-adding capabilities of Huawei in differentiating itself.

Conclusion

The overview of the case studied above has led towards a direction and pattern in which can be drawn. First of which these Asian companies similarly receive forms of support from government to tackle the initial penetration into the global market and this is also in favor of these states in which wishes to gain technological advancements in each given country of origin. This motivation has led to the popular route in which these Asian MNC opted for in strategic alliance and partnership with competitors and technologically advanced companies. This is also made possible by the heavy resources and capital possessed by each of these MNC. Another pattern that can be drawn is the imitation or follower strategy in which all of these MNCs more or less leveraged from established US and EU markets and the technologies available with further innovation propelled these Asian MNC to eventually became leaders in the global market.