Martin P Wilson


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Emerging Markets – New Opportunity, New Challenge


Institutional voids are the big challenge for exporters and new entrants into emerging marketsThis book provides a framework for defining business strategies to deal with such challenges.

Analysing and Defining New Business Strategies for Success in Developing Markets

Multinational business managers have to recognise the special needs of establishing a presence in growing markets such as India, China, Brazil and other emerging economies. Winning in Emrging Markets explains the challenges through case studies and provides a tool kit to help planners analyse the challenges.

Institutional Voids and the Challenge they Represent for New Entrants into Emerging Markets

Part 1 of Winning in Emerging Markets explains the concept of “institutional voids” that get in the way of multinationals applying their developed market business models in the rapidly expanding emergent economies.

Institutional voids are where regulatory, informational or operational services, taken for granted in highly developed markets, do not exist or are under-developed. The checklists provided by Winning in Emerging Marketsare therefore invaluable as it would be all too easy for a manager sitting in London or New Yorkto get caught out byassuming all the necessaryservices exist in Mumbai, Beijing or wherever.

Having helped identify the institutional voids Winning in Emerging Markets uses case studies to illustrate suitable response by previous new entrants, both successful and flawed.

Applying the Ideas – What it Means for Local Giants and Developed Multinationals

Part 2 of Winning in Emerging Markets explores the practicalities of doing business in these new economies for those corporations entering the market for the first time and the major local enterprises. It also considers how those national giants can prepare themselves to break out in to wider global markets and how the institutional voids that did not matter in their home markets create new challenges.

This section is broken down into five chapters:

  • Exploiting Institutional Voids as Business Opportunities. The institutional void can also be an entrepreneurial opportunity for new business ventures or as part on an entry strategy for a multinational.
  • Multinationals in Emerging Markets. Many such corporations have been in the new markets since they openedand provide valuable case studies of both success and failure as a guide to newcomers.
  • Emerging Giants: Competing at Home. Emerging markets have developed major corporations that have exploited their competitive advantage by understanding institutional voids in their home markets. Their rapid domestic growth provides a platform for global ambition and lessons for incoming businesses.
  • Emerging Giants: Going Global. As the national enterprises seek to expand globally they are often constrained by a new set of institutional voids that were previously of little importance. Also the breadth and variety of the new global markets and their different business practices create new challenges and risks.
  • The Emerging Arena. The final chapter ofWinning in Emerging Markets consider the degree of development, the “emergingness” of new markets and the opportunities they present. This factor also affects how strategies have to be tailored through detailed analysis of product needs and the opportunities that institutional voids present.

Success and Failure – Flexible Strategies are Needed for Emerging Markets

Winning in Emerging Markets, A Road Map for Strategy and Execution is a comprehensive guide for developing entry strategies into such markets. Although at first the checklists may appear obvious and superficial it soon becomes clear that they are part of comprehensive tool set. The toolkits will support the market analysis and strategic planning for would be entrants into new markets.

The use of case studies makes Winning in Emerging Markets a valuable contribution to the strategic planner and senior executives considering their plans for new markets. It is a readable volume with a focus on practicality that will suit practising managers rather than theorists.Most importantly with the help of Winning in Emerging Markets it will be possible for the reader to avoid the assumptions that have derailed previous entrants.

Authors with Authority

The authors are both with Harvard Business School where Tarun Khana is the Jorge Paulo Lemann Professor. He is also author of several books on emerging markets. Kishna G. Palepu is the Ross Graham Professor of Business Administration and Associate Dean for Internal Development.

Winning in Emerging Markets, A Road Map for Strategy and Execution (2010, ISBN: 978-1-4221-6695-6) by Tarun Khann and Krishna G. Palepu is published in hardback by Harvard Business Press at $35.

This is a book that should be read by all executives and managers preparing business strategies for emerging markets, or to understands the challenge of global competition from national enterprises from such markets.

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Quick Thoughts

Has Military Action Ever Dissuaded Tyrants?

Syria - flagIn his speech before the war in Iraq Tony Blair, the UK Prime Minister, argued that not intervening would send a message that tyrants would feel at liberty to act without consequence. By military action in Iraq, he argued, those who would perpetrate atrocities would think twice. There would not seem to be any evidence, before or since, that would back up that contention.

We now have David Cameron, the current Prime Minister, making essentially the same arguments – do politicians ever learn from history?


Government Spending is not Driver of Growth

Parliament Square London IC02001If more public spending is the only way to create growth then surely governments have become too large a part of the economy? Government is about spending and has little to do with creating wealth.

The best government can do is move wealth from individuals and business to those who serve government.


Capped Bonuses, There May be Trouble Ahead

Politicians do not seem to be good at imagining unintended consequences. The cap on bankers’ bonuses, however popular, may be counter-productive in reducing risk.

Dark Stormy Skys and Beauty Often CoexistIf a smaller proportion of a trader’s income is at risk if a trade goes wrong they may pursue high-risk opportunities to get that big win. If it works they guarantee the full bonus and could also use it to negotiate a higher salary (and bonus) for the following year. If it fails the downside is limited by the capped bonus to a smaller part of overall income. At the end of the day traders are competitive and gamblers at heart so will they be more likely to pursue the big win when their own risk is limited?

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