123 School Work

Daewoo Corporate Corruption

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  I. Case Synopsis
  Daewoo company had been set-up in 1967, by 5 associates from South Korea, with a capital of $10,000. The company was acting in the textile industry and international trade.
  From 1980, the company diversified in the electronic industry and, soon after, in the automobile industry. During 1980 and 1995, Daewoo expanded in the entire world, especially through joint-ventures and acquisitions, distributing its products -- through this network -- on 6 geographical areas:
       Asia (India, Japan, China, Vietnam, Korea, Hong Kong, Thailand, Taiwan, Korea);
       Middle East (Iran, Libya, Emirates);
       West Europe (Ireland, England, France, Spain, Germany)
       Eastern and Central Europe (Romania, Czech Republic, Poland, Uzbekistan)
       Africa (Algeria, Morocco, Sudan, Nigeria, South Africa)
       Latin America (Mexico, Chile, Panama, Argentina, Ecuador, Jamaica)
  According to some economic observers, the growth of the company (over 400 production units, 261 national distribution branches and 123 national representative offices for distribution and sales) was possible due to the effort of developing in its R&D centers "The Daewoo technology", which will be the "key success factor for the globalization of the company".
  The effort of globalization will be concentrated in the automobile market - where the company targets the top 10 world rankings
  The expansion in the Eastern Europe brings in discussion the specific buying process, which is shifting from one based on quality and brand reputation to one based on price, due to the particular environment in these countries. This pattern in the purchase decision may create difficulties for the companies with manufacturing process concentrated in countries with high labor cost. Also, different cultures, tastes and habits pose new problems for foreign companies in marketing their products.
  Daewoo is also concerned about some changes in the competitive environment; particularly by the emergence of Hyundai as a future powerful competitor in the Eastern European market.
  
  II...