US Based Manufacturer of Natural, Health Food Products Considering Growing Business in Chinese Market, Problem Solving, Case Study(Management Strategy for Performance)

Have you ever imagine the exchange rate between the USA dollar and Chines Yuan, do you know the process of registering international companies and way how you are to repatriate your profit back to the USA from China. The dimensional change in business proliferation from western to eastern hemisphere of the globe not only comes will an opportunity but the waves of risk are also unequivocally lingering. Beyond these economic variables other factors to name, like socio-cultural identifications, political philosophies, level of competition, and consumption pattern of households et cetera also impacts.

Hence cross-border business should not be limited to the expected size of the prospective market. As of 2016, China has a population of 1.379 billion and it does not guarantee that the natural health food product of USA wins Chines market. I personally believe it has to be an in-depth evidence-based procedure carried on the basis of research.

Hence firstly for me, it begins with understanding my own products. It involves rigorous analysis of ingredient, its usage, and consumption mechanism, I believe, it will help me to create the best fit between product varieties and target market as the usage patterns differs drastically between China and USA.

After being known with my own product, I intend to invest some time in stakeholder analysis.  These involve the group of people, communities who have direct or indirect influence on the products. These as mentioned above are the factors than arises from the external and internal environment. As stated by (Baldwin, Bommer, & Rubin, 2013) through Vroom and Yetton's stakeholder analysis, the scope of the impact of stakeholder could be incorporated in our product. It helps us to predict the reaction of related groups towards the product. A better approach here could be incorporating their views by leveraging them to provide their views on the products. I believe it helps our US manufactured product to get localized Chines inclination through product packaging, leveling, promotion, pricing et cetera.

Simultaneously, numerous researches will be executed, it supports evidence-based decision making, and these quantification helps to make our inferences precise.  As per (Wedellsborg, 2017) most of the managers switch to the solution mode rather than understanding the problem, these leads to create a condition of equifinality where the decision makers get stuck and are often ultimately bewildered by their own biases. The secondary research on the Chinese market could be extracted from the official websites like worldbank.com, imf.org, and Chines government website et cetera. It gives us birds eyes view on demographics, economic, social, cultural dimension of the economy and their affinity towards US products. Similarly, the annual report entitled "Doing Business 2017” published by Worldbank will help us to get the overall ease of doing business in China.

Similarly, the questionnaire could be designed to get expected feedback from the customers and analyze competitor's reaction towards the product. These help us to grab the real field scenario and possible competitiveness of our product or repulsiveness from the Chinese market. These questionnaires will be administered along with secondary analysis. The combination of primary and secondary analysis helps us to generate holistic views. 

Let's assume the scenario where we concluded from our evidences that Chines youth aged 20-30 years were found to be using natural and herbal food products mostly, similarly Chinese government advocacy for the green environment is also supporting the health of its citizen and environmentalism, these factors support us. Now we begin to customize our marketing mix and design them as according to the view to penetrate the Chinese market. We can glamorize our product through appealing promotion, competitive pricing et cetera. But on the other hand, if the findings were not supportive, which also could be, it would be in our best interest to invest our resources in other countries.

To conclude, the decision of investing in China shall not be a decision based of homogeneous factors, it includes, as mentioned above, various heterogeneous variables that have to be taken care off, and with all logical, scientific and evidence-based practices the happening of the odd could definitely be reduced. 

Figure: Flowchart based on PADIL on making investment decision by US firm in China

Bibliography

Baldwin, T. T., Bommer, W. H., & Rubin, S. R. (2013). Managing Organizational Behavior: What Great Managers Know and Do. New York: McGraw-Hill.

Wedellsborg, T. (2017, February ). Are You Solving the Right Problems? Retrieved January 15, 2018, from www.hbr.org: https://hbr.org/2017/01/are-you-solving-the-right-problems