Drivers of Global Business Success: Lessons From Emerging Markets

Citation

Xu, S. (2007), "Drivers of Global Business Success: Lessons From Emerging Markets", European Journal of Marketing, Vol. 41 No. 1/2, pp. 223-225. https://doi.org/10.1108/03090560710718193

Emerging markets have attracted the attention of both academics and business practitioners due to their rapid economic growth, substantial market size, and the rising purchasing powers of customers. As a result, a number of books have been published to address the marketing issues arising in these countries (Cavusgil et al., 2002; Prasad and Ghauri, 2004). Such books offer a basic understanding of these markets coupled with detailed strategic guidelines to help firms from developed nations to compete successfully in these unfamiliar environments. It is therefore apparent that these books have predominantly been written from the point‐of‐view of multinational enterprises from developed nations. This book is unusual in that it takes the opposite perspective: how do firms from emerging markets compete in the global arena and what are the success drivers for them?

The book is organized into four parts. The authors lay the foundations by starting in part I with a general description of the trends in international business. The evolution of emerging markets, their characteristics, and a typology are clearly laid out. Detailed statistics are emphasized to demonstrate the importance of emerging markets and their firms in world trade. Part II of the book focuses on the academic view of emerging markets and the companies that originate from them. Popular constructs that have been traditionally studied in the context of developed nations, such as market orientation and leadership styles, are here analyzed for emerging markets. Specific attention is given to the transitional nature of these local markets and the impact this has on the familiar concepts. One important learning of this part is that firms from emerging markets do display distinctive characteristics in their way of thinking and strategy formulation compared with their developed country counterparts.

The ten case studies in part III explore how companies from emerging markets can successfully enter other markets. These studies cover a wide range of emerging markets such as China, Turkey, India, and Azerbajian, as well as a diversity of industries. This coverage of markets and industries are excellent benchmarks for other emerging market firms. The editors provide synthesized key learnings in part IV drawing on previous part. Part IV is thematic across the cases, picking our common factors and those that are unique in leading to global success using the conceptual mapping technique. The editors organize their analysis around what they call a “success diamond” composing four drivers of global success: organization, markets, people, and operations. The success factors that transpire for firms from emerging markets are: tight‐loose organizational structure, flexible creative approach, emphasis on being world‐class, and relationship focus.

This book stands out in two respects compared with existing contributions on the subject: novelty in terms of its emerging market companies' perspective, and in terms of inputs from both academic scholars and practitioners.

Emerging markets used only to be depicted as opportunities for multinational enterprises from advanced nations to explore. Yet, as this book makes clear, small‐ and medium‐sized firms from emerging markets can compete successfully in the global market. This book is timely given that firms from the emerging markets are gaining more and more presence in the global business environment. Those firms no longer merely play the “defensive” battle against the foreign firms in their own nations but instead they compete more outside their home territory and understanding the success factors of these firms becomes an important topic.

However, it would be unrealistic for firms from these emerging markets to copy the best practices of the established multinational enterprises due to their limited resources and different mentalities of management. Strategy formulations need to be locally developed and custom‐tailored to the characteristics of these firms. This book devotes a large amount of space to the actual business experiences of successful emerging market companies in their international expansion that provides relevant and valuable lessons for firms with same interest. Most authors of the articles in the book come from nations of emerging markets, which offers them the advantage of personal observation and a deep understanding of the characteristics of the cultural, economic, and social dimensions of these emerging markets that are relevant to business practices. In addition, the book examines companies from almost all the major regions of the emerging markets and this greatly increases the value of the lessons learned and the generalizability of the findings.

Compared with books that solely relied on contribution from academics, this book also distinguishes itself by drawing on inputs from both academics and practitioners. While other books on the same topic have been much academic orientated, authors of several articles in this book are senior executives of firms from emerging markets who possess personal experiences in guiding the international expansion of their firms. Their input greatly enhances the value of the book. What makes this book special is that the editors actually derived lessons from the cases while other books mostly used cases to illustrate their suggested ideas (Cavusgil et al., 2002). The editors have paid special attention to obtain lessons from a diversity of geographic locations, industries, and firm sizes. The success stories of these firms and the diversity of the industries and geographic locations these firms represent offer greatly benchmarking possibilities for others.

Compared with other books that are much more academic, this book is more suitable for MBA students and senior business executives. For managers from emerging market, this book provides a direct guidance in their international expansion effort. Managers from developed countries will benefit from reading the book by gaining a deeper understanding of what they may encounter in their future competition with firms from the emerging markets as well as what they need to do to remain competitive in the global market.