Building Business Relationships in the Global Agro-chemical Sector: Opportunities and Obstacles across Strategic Distances between Germany, Switzerland and Japan
This thesis examines with the help of practicioners which distances between countries pose obstacles or opportunities for a German or Swiss agro-chemical company when trying to establish business relationships in Japan.
Sven Stutz, 2018
Bachelor Thesis, Company in the agro-chemical sector
Betreuende Dozierende: Keith Jackson
Keywords: Internationalization, Japan, CAGE, agro-chemical sector
The company consisting of several production sites in Finland, Switzerland and Germany where the headquarters are located is well established in Europe as well as the USA. One business unit located in Switzerland with its department "New Business Development" started to target second tier innovators in Japan in accordance with the overarching strategy of the company. The market in Japan is promising and therefore first contacts were made to prepare the establishment of business relationships. The goal of this bachelor thesis was to explore obstacles and opportunities which might arise during this venture and to develop recommendations how the department could handle them.
First, secondary literature helped to identify relevant models and theories which are concerned with differences and distances between regions on country-, industry- and company-level. From this the CAGE Framework by Pankaj Ghemawat was selected as an appropriate model for further research methods. Second, a case study of a business unit of a company comparable to the client which entered the Japanese market from 1997 to 2001 was conducted. Third, in total five interviews with practicioners revealed relevant distances and thus opportunities and obstacles for such a venture. Fourth, for the validation of the findings from the interviews a survey was distributed to three experts on the field.
The main findings from the applied research methods point towards the cultural distance as the one which might poses the most obstacles and opportunities for the plans of the client. This distance includes the opportunity that German and Swiss companies enjoy a positive perception by Japanese people. The obstacles include foremost the difficulties which might arise due to the time needed to establish relationships as well as business in the country. Furthermore, communication problems, troubles with Japanese employees in cultural terms and difficulties with market awareness and reputation on the market were other main findings attributable to the cultural distance. From the administrative distance, the registration process for new chemical products was identified as an obstacle. The tendency of Japanese companies to buy domestically was revealed as an obstacle from the geographical distance and the struggle of recruiting Japanese employees as one of the economic distance.
For the client these potential issues as well as recommendations to deal with them should be beneficial to further implement the strategy of expanding business to Japan.
Studiengang: Business Administration International Management (Bachelor)
Fachbereich der Arbeit: Andere