STRATEGIC MANAGEMENT

Strategic Management



Table of Contents

Executive Summary2

Discussion5

Country A (South Korea)5

Country B (India)6

Cultural Conditions and National Business System7

National Business System7

Business Culture8

Industrial Trends and Patterns of Trade9

South Korean Outward Investment9

Indian and South Korea Industrial Trade9

Limitations in Indian Industry10

The Exchange Rate Regimes in South Korea and India10

Exchange Rate10

Exchange Rate Risks and the Currency Appreciation11

New Strategies for Hyundai15

Market Entry Preparation15

Launching in India15

Mergers and Acquisition Approach of Hyundai16

Early Growth17

Secondary Growth Phase17

Cost Based Production18

Supply Chain Integration19

Financial Problems20

Benefits of FDI and Implication for Hyundai21

Future Considerations22

Conclusion23

Executive Summary

Hyundai manager advice to the board of directors and top management about the strategic management plan for Entry in Indian Market and gain the benefit of foreign direct investment (FDI). Hyundai is a huge South Korean company that specializes in Automobile and is in the list of market leaders of South Korean Automobile Industry. The aim of this report is to help the CEO decide if the Hyundai should engage in trade and/ or invest in the market in India. Get an overview of the Indian market, this report provides a detailed analysis of why Hyundai's entry into the Indian market would be an advantage or not. To meet the planned growth in the projected market, Hyundai expects to need to expand production from 10.000 to 210.000 within five years. Given the expected strong growth in the market, Hyundai has realized that its distribution decisions would be critical infrastructure support to meet their market entry and expansion. Hyundai has developed a flexible supplier development optimized vendor options, including number and type of available suppliers, factors and logistics necessary for the supplier / vendor systems to create, and measured and deliberate increase in the proportion of local suppliers, i.e. the degree of localization.

Introduction

Historically, despite positive growth in production forecasts and the associated benefits to the local access market, many foreign companies have a significant problem getting preferential market in India. Indian Government and established businesses have extended a welcoming hand over foreign investment in India. We examined the development of Hyundai and its integration in the business environment (Tony, 2011, 176-87).

In simple words, nowadays international automotive market is unbalanced. Traditional manufacturers are trying to survive the financial and economic crisis. They must meet the explosive demand growth in new geographic areas and manage more complex supply chains, changing consumer preferences and development of production changes. Attractiveness in customer demand from developing countries such as India's new strategy for the business climate driven by many non-Indian car manufacturers who wish to explore this growing and profitable market.

Discussion

Country A (South Korea)

The South Korea is a major trading nation and financial centre, falling amongst the quintets of trillion dollar economies. Since the 1992 recession, the South Korea's economy has enjoyed sustained economic growth ranging from 2-3% since 2004, outpacing most of Europe (CIA world fact book, 2010). This has allowed the sector to prosper in a diversified market-based economy, in turn enabling high employment, easier access to products and services and thus facilitating most residents with a high standard of ...