Executive summary
The need for water in developing countries is on the rise. This is evident by constant demand for water disinfection equipments by the developing countries. The rising population is a contributing factor as it strains the available water resources. An example of these countries is China whose population is constantly growing.
The necessity for improved water supply is the preferred option to ensure that its cities, towns, municipalities and villages do not lack this commodity. The Trojan Technologies comes in as the main provider of this solution to China. This is going to be an opportunity to use their technology of UV. The technology is environmentally friendly, hence making it compliant to China’s environmental requirements.
The company’s strategic plan for five years would receive a boost if given the opportunity to revolutionize China’s water condition. This is evident from the sales the company had made to China previously. This also was going to be given a boost by the forecasted growth rate in China’s industries.
The Trojan Technology if given the chance would also benefit largely from the environmental protection industry given that its technology is environmentally friendly. It is better than the use of chlorine that had been in use for long.
The company however, is faced with challenges in doing business in China. The challenge includes that of protectionism by the country. The country discourages any importation of foreign equipments in its bid to protect its tax revenue. Secondly, is the countries weak policy on corruption. Lastly, is the lack of protection on intellectual property. Otherwise the country offers the best opportunity for companies like Trojan Technology.
Introduction
Trojan Technology is a company dealing in disinfection of water. It handles both clean water and waste water. It is relatively advantageous compared to the use of chlorine. UV technology is environmentally positive. The company is in dilemma of whether it should proceed with the idea of carrying out its business in China or not. The reason being that the government of China has weak policies on corruption. It does not provide enough protection for intellectual property. There is also the protectionism by the country which bars the importation of foreign equipments from other countries.
The opportunity to Trojan Technologies to carry out this project is major boost to its growth and development. The business environment in China is not fully exploited by foreign companies. The fact that the Trojan Technologies is one of its own gives it an edge over other companies. The timing is also appropriate given that China’s economy and its population is rapidly increasing.
Alternative strategies that the company can adopt to address the dilemma
The company should capitalize on its agents who are situated in China to market its services. The response from the influence that the agents would instill could favor there company. This will be made possible through liaising with project design and contractor companies. This will in turn force them to seek reference from the mother company. In this stage the company can negotiate with the government on how bureaucracies will be dealt with.
The company could also undertake to train staff from China on how to install the UV equipments, Chinese business practices and Chinese water disinfection market. In doing this, the country will not see the presence of the company as a threat to there local companies. In fact they will consider supporting it as it creates jobs for their people. They will seem to own it.
The company being a pioneer of UV treatment technology offers them an opportunity to be regarded as the best in rendering the disinfection services and supply of equipments. This will edge out competition.
Identify the relevant cultural, political (including legal) and economic factors that any decision-maker with global responsibilities should address.
The viability of the project
The legal and political frame work
The return on investment
Analysis of the global factors identified
The chances of the business thriving are very high. The reason being that-: UV technology is one of it own. It is more efficient as compared to chlorine which as been on use for sometime. This is also supported by China’s need for safer clean water. The China’s rise in industrialization also calls for safer waste treatment.
The government of China passed strict laws that go along way in protecting its environment. This is quite unique compared to other countries. This to Trojan Technology is not going to be a hurdle since it is geared towards alleviating most of the problems affecting the environment. However, due to bureaucracies involved in decision making this could slow the process. This could lead them to questioning the eligibility of the technology.
The body in charge of decision making is the municipal governments. It is responsible for offering tenders for building of supply or treatment plants. The projects are awarded after competitive bidding. However, the process is not transparent. This is a clear evidence of lack of strict laws on corruption.
There is protectionism. China discourages the importation of foreign equipments. This is a scheme to protect its tax revenues. This scheme is going to complicate matters for Trojan Technologies because most of the equipments have to be imported from London.
The political landscape of China appears to gain a lot from the weak policies that fail to curb practices on corruption. This is because politicians can influence the bidding of projects. Those who have contacts of influential people often carry the day.
The return on investment is going to be high. The economy growth in China is escalating and this is contributed by the growth of more industries. As a result of this, Trojan Technologies is going to benefit a lot since they will undertake all projects. The government emphasis on building water treatment plants in the municipalities in the country will increase the returns. However training personnel from the country to carry out most of the responsibilities will increase investment capital.
The Board of Trojan should proceed to bid for tenders on construction of water plants, supply of water treatment equipments and marketing their services. This is going to open up the market on this business. The board should also consider training personnel from China on construction and maintenance of treatment plants. There is also need for the company to be acquainted with laws on international business to prevent any form corruption that may arise in the search for projects in the country. It is also paramount that the company carries out a market research to establish the extent of influence that domestic companies have so that they can invest on their weak areas.
References:
Canadian Institute of Chartered Accountants. (2004). Financial Reporting in Canada. Canada: Canadian Institute of Chartered Accountants.
Icon Group International, Inc.staff. (2000). Trojan Technologies Inc.: International Competitive Benchmarks and Financial Gap Analysis. Icon Group International, Incorporated.
Morse, E., & Mitchell, R. K. (2006). Cases in entrepreneurship: the venture creation process. California: SAGE.
Sacks, A. M., & R, R. H. (2011). Managing Performance through Training and Development. London: Cengage Learning.
