Winning in Asia, Japanese Style: Market and Nonmarket Strategies for Success

291 Pages·2002·33.64 MB·English

by  Vinod K. Aggarwal

Winning in Asia, Japanese Style

Winning in Asia, Japanese Style
Market and N onmarket
Strategies for Success
Edited by
Vinod K. Aggarwal and Shujiro Urata
* WINNING IN ASIA, JAPANESE STYLE
©Vi nod K. Aggarwal and Shujiro Urata, 2002
Softcover reprint of the hardcover 1st edition 2002 978-0-312-23910-7
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First published 2002 by
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ISBN 978-1-349-63235-0 ISBN 978-1-137-10926-2 (eBook)
DOI 10.1007/978-1-137-10926-2
Library of Congress Cataloging-in-Publication Data
Winning in Asia, Japanese style: market and nonmarket strategies for
success/co-edited by Vi nod K. Aggarwal and Shujiro Urata.
p.cm.
Includes bibliographical references and index.
ISBN 978-0-312-23911-4
1. Japan-Foreign economic relations-Asia. 2. Asia-Foreign economic
relations-Japan. 3. Marketing-Japan. 4. Marketing-Japan-Case studies.
5. Marketing-Asia-Case studies. 6. Investments, Japanese--Asia.
7. Investments, Foreign-Asia. I. Aggarwal, Vi nod K. 11. Urata Shujiro, 1950-
HF 1602.15.A74W56 2002
658.8'0095-dc21 2002068417
A catalogue record for this book is available from the British Library.
Design by Newgen Imaging Systems (P) Ltd., Chennai, India.
First edition: October, 2002
10 9 8 7 6 5 4 3 2 1
CONTENTS
Priface Vll
Contributors lX
List of Abbreviations Xl
Part One Theoretical Framework 1
Chapter One Analyzing Japanese Firms' Market and
Nonmarket Strategies in Asia 3
Vi nod K. Aggarwal
Chapter Two Japan's Foreign Direct Investment and
Trade in Asia 27
Shujiro Urata
Part Two Case Studies 59
Chapter Three Banking on East Asia: Expansion and
Retrenchment ofJapanese Firms 61
Masahiro Kawai, Yuzuru Ozeki, and
Hiroshi Tokumaru
Chapter Four Cartels, Competition, and Consolidation in
the Japanese Chemical Industry 98
Tametsugu Taketomi
Chapter Five On the Road to Asia: Japanese Automakers
inASEAN 123
Gregory W Noble
Contents
Vt
Chapter Six Ringing off the Hook! Japanese
Telecommunications Responds to the
Call of Asian Markets 15 7
Yumiko Okamoto
Chapter Seven Cracking the Code: Japanese Software
Strategies in Asia 184
Trevor H. Nakagawa
Chapter Eight Short Circuiting Keiretsu: Japanese Electronic
Firms in Asia 220
Hidetaka Yoshimatsu
Part Three Conclusion 241
Chapter Nine Lessons from Japanese Firms' Strategies in
Asia 243
Vi nod K. Aggarwal
Index 273
PREFACE
The unbounded enthusiasm of European, American, and Japanese firms
for Asian markets was tarred by the Asian crises of 1997-1998. As cur
rencies plunged and fear grew that the crises would continue to spread,
many firms began to reassess their commitment to Asian markets. Yet the
rapid descent of these economies was followed almost uniformly by
rapid recovery. Faced with opportunities to secure assets at bargain base
ment prices and anticipating greater liberalization of Asian markets,
many firms once again rushed into the breach.
This book analyzes how Japanese firms have attempted to succeed in
Asian markets, both before and after the Asian crises. A central focus of
this volume is the formulation and implementation of market, nonmar
ket, and organizational strategies. Market strategies have been the topic of
many works. Yet as the case studies in the book demonstrate, the most
successful firms have succeeded in Asia by integrating market strategies
with nonmarket and organizational strategies that help firms respond to
and benefit from shifts in the political, economic, and social environment.
Firms that have been able to leverage their capabilities to secure assistance
from their home governments, and that have pursued and developed
strategic relationships with Asian governments and firms, have repeatedly
emerged as winners. By examining integrated market, nonmarket, and
organizational strategies, both from an analytical and empirical perspec
tive, we hope that this book will enhance or understanding of firm strate
gies in Asia that will be of benefit to both analysts and practitioners.
This project has been generously supported by the Center for Global
Partnership of the Japan Foundation. Over a three-year period, their
financial assistance has allowed us to examine Japanese, American, and
European firm strategies in a changing Asian market. In particular,
we would like to thank Takashi Ishida, the current director, and
viii Priface
Junichi Chano, the previous director,Junichi Chano, as well as staff mem
bers Susan Hubbard, Mary McCarthy, Sandhya Rao, and Lisa Weiss. The
earlier work on Europe was supported by a grant from the Institute of
European Studies of the University ofCalifornia.We are greatly indebted
to the Institute's director, Gerald Feldman, and its associate director,
Beverly Crawford, for their help.
Two workshops were convened to discuss the papers in this volume,
one at Berkeley and another in Tokyo at Waseda University. A wrap-up
conference brought together participants from the European, American,
and Japanese subprojects, and allowed participants to share ideas, com
pare notes, and better understand different sectors from a comparative
perspective. The contributions of other readers are acknowledged by the
authors of each of the chapters.
We are especially indebted to the staff of the Berkeley APEC Study
Center (BAS C). At BASC, Ed Fogarty, Ralph Espach, Elaine K wei, Trevor
Nakagawa, Kun-Chin Lin, Min Gyo Koo, Zachary Zwald, and Chris
Tucker have provided valuable research assistance, comments, and help in
organizing the Berkeley workshops. A number of undergraduates also
assisted in preparing the manuscript and in editing papers. For their help,
we are particularly grateful to Joel Burgos, Justin Kolbeck, Matt Odette,
Mytoan Nguyen,Jennifer Rho, and Dan Xu, all of whom have worked
or currently work at BASC as part of the Berkeley Undergraduate
Research Apprenticeship program.
Toby Wahl ofPalgrave has ably taken over from Karen Wolny who orig
inally signed the "Winning in Asia Series." Gabriella Pearce, who works
with Toby, has been of immense help in managing the publication process.
Vinod K. Aggarwal
Berkeley, California
and
Shujiro Urata
Tokyo, japan
CONTRIBUTORS
VINOD K. AGGARWAL is Professor in the Department of Political
Science, Affiliated Professor in the Haas School of Business, and Director
of the Berkeley APEC Study Center (BASC) at the University of
California, Berkeley
MASAHIRO KAWAI is Professor of Economics in the Institute of
Social Science, University of Tokyo and Deputy Vice Minister of
Finance for International Affairs at the Ministry of Finance, Japan
TREVOR H. NAKAGAWA is a Ph.D. candidate in the Department of
Political Science at the University of California, Berkeley
GREGORYW NOBLE is Associate Professor ofPolitical Science at the
Institute of Social Science, University ofTokyo
YUMIKO OKAMOTO is Associate Professor of Economics at the
Graduate School of International Development, Nagoya University
YUZURU OZEKI is Professor in the Asian Public Policy Program,
Graduate School of International Corporate Strategy, Hitotsubashi
University
TAMETSUGU TAKETOMI is Director of Monday (formerly PwC
Consulting), Japan
HIROSHI TOKUMARU is Manager, Bank Supervision Department,
Bank ofJ apan