Abstract
Most of the Western Companies, in the last years, have been facing a tough competition against manufacturers based in developing countries, especially in China. How to face the Chinese competition is an open and relevant issue. This paper aims at giving a contribution to the on-going debate proposing an operational model which might help many SMEs to gain a stronger competitive position. The proposed model can be considered as a rationalization and generalization of an approach to change successfully applied by the author in the last fifteen years in over 30 small and medium enterprises. As to the target, this model has been designed primarily around those SMEs characterized by one or more of the following characteristics: no strong brands, operating in price-driven markets and with products/processes which cannot benefit significantly from investments in RD second, it allows to evaluate what, in practice, has proved to be particularly crucial for the firm and to analyse critically the most relevant lessons learned casting light on the critical success factor for the implementation of the proposed model.
Highlights
Most of the Western Companies, in the last years, have been facing a tough competition against manufacturers based in developing countries, especially in China
Gridiron S.p.A. operates in a price-driven sector where the Chinese competition can be extremely aggressive; the relevant lessons learned from the analysis of the case study are that: ● there is a segment of the market that appreciates the risk reductions associated with flexibility of quantity, variety and short lead times
While such forms of risk hedging are somewhat unexpressed by most of the customers, this does not mean that they cannot become powerful forms of added value; ● despite the potentialities associated with such a strategy, it is worth noting that many conditions and prerequisites must exist to ensure the profitability of such a business strategy; ● the experience of Gridiron S.p.A. indicates the importance of the investments on ad-hoc, full custom IT and technological solutions: the most relevant lesson learned is probably that a real innovation comes from state-of-art technologies customized to follow the specific intricacies of each business, to exploit those peculiarities and specific best practices that make every Company unique and, in most cases, highly performing
Summary
Most of the Western Companies, in the last years, have been facing a tough competition against manufacturers based in developing countries, especially in China. Primary objective of this research work is to present the main characteristics of this model and to analyse its pros and cons, casting light on its applicability and the potential benefits. In this sense, we make us of a case study that can be considered paradigmatic of the situation. In order to understand the possible impact of the proposed approach, first an analysis focused on the capabilities and potentialities of the emerging countries has been done Such analysis is by no means intended to be a comprehensive picture about China and the other developing countries: the theme would be extremely complex, a wide and valuable literature is available (see, for example Chow [1] and Terrill [2]). It is functional to analyse some of the most relevant aspects of the approach proposed
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