Editorial

Citation

Akbar, Y.H. (2007), "Editorial", International Journal of Emerging Markets, Vol. 2 No. 3. https://doi.org/10.1108/ijoem.2007.30102caa.001

Editorial

Welcome to Volume 2, Issue 3 of IJOEM! Following on from our successful special issue on SMEs in Volume 2, Issue 2, our current issue returns to the standard format of the journal.

We are delighted to present an Executive Insight from Thomas Lenartowicz and James Johnson that examines the challenges faced by companies looking for managerial talent in emerging markets. The paper is a tour de force on the required HR strategies of multinational companies in emerging markets. Of particular interest in the paper is the discussion of cultural competence among multinational managers and the paper is extremely well written for practitioners as well as scholars. It offers a perspective on the different kinds of HR strategies we can expect from multinational companies in emerging markets and offers a warning to these companies that Cultural Competence is a key drive of competitive advantage and that they should continue to invest in cross-cultural training for their cadre of global managers.

Next up is a paper by Punnett, Corbin and Greenidge that examines the importance of goal setting in organizations to improve their performance. The starting premise of the paper is that while significant amounts of research have been done on goal-setting in the developed country context, we have relatively little work done in emerging markets on this topic. Their tableau for analysis is the Caribbean. An experimental study, the paper examined the relationship between goal setting tactics and cultural dimensions such as individualism and uncertainty avoidance. Their results suggest that, similar to developed countries, specific and difficult goals result in better performance, and that higher levels of individualism and lower levels of uncertainty avoidance result in better performance – an important implication for Lenartowicz and Johnson's paper.

Rajagopal examines marketing strategies for organic cosmetics and toiletries (OCT) in Mexico. Like Punnett, Corbin and Greenidge above, though there has been significant research in developed countries on this topic, relatively little has been done on emerging markets. The study is based on consumer surveys in department stores in Mexico and Rajagopal confirmed that marketing strategies should focus on informing and developing awareness of OCTs as alternatives to synthetic products. Managers may consider the measurement of customer value with the advent of one-to-one marketing media, e.g. targeted direct mail or internet marketing. According to Rajagopal, the opportunities to develop customer relationship management campaigns are enhanced in such a way that it is now both organizationally and economically feasible to support a substantially larger number of marketing segments in a profitable manner.

Sim and Pandian bring us back to a recurrent theme in emerging market research: the growth and development of emerging market multinationals (EMNEs). Through a cross-country comparison of Taiwanese and Malaysian multinational companies, the authors analyze the internationalization strategies and characteristics of Asian MNEs within the investment development path (IDP) perspective. They find that the internationalization strategies of the Taiwanese and Malaysian case firms were founded on cost-based competencies and other location-based advantages, brought together by an extensive web of ethnic networks – confirming the claim that EMNEs start out leveraging cost and location to compete but should be expected to migrate products and services into differentiated, knowledge based sectors. The continued upgrading of EMNEs from China (Lenovo and Haier) and South Korea (Samsung and LG) suggest that we can expect Malaysian and Taiwanese companies to follow suit in the near future.

Demirag, Glaister and Tatoglu present the findings of a survey research project into basic trends and patterns of European foreign equity venture formations in Turkey over the 1996-2003 period. Unsurprisingly, FDI operations in Turkey are dominated mainly by European and US MNEs – given psychic distance and historical ties. The analyses also revealed that new FDI operations have changed the structural composition of overall FDI activity in Turkey. European equity venture formations tend to be located in the concentrated industries and also in the relatively fast growing industries. It is shown that there exist some differences among European investors when they are classified by country of origin. There are also locational differences by sector, entry date and country of origin. It appears that as European investors gain experience of the host country market, their entry mode may change over time. These findings confirm that Turkey is emerging as an important location for production for multinational companies and it appears in similar fashion to Sim and Pandian, that Turkey's investment development path may be towards higher value-added, knowledge based investments and away from purely cost-based investment (although that is likely to remain important for Turkey in the short term).

We close Issue 3 with a truly interesting case study of Honda Motorcycle's entry into the Vietnamese market. Possibly two of the most famous and widely-debated cases were Harvard Business School's Honda cases (expansion in the USA on the one hand and the impact of Honda on the UK motorcycle industry on the other). Tiep finds that Honda's entry strategy in Vietnam has been adapted to the Vietnamese market and adopted elements of Chinese companies approach to Vietnam. The penetration of Chinese motorcycle into Vietnam has brought more opportunities Honda can utilize for long-term investments than challenges the firm had to temporarily deal with. The effect of changes in the local market was quite specific to Honda business. Consequentially, local factors have driven the Honda's emergent strategy towards a low-price model that is considered as Honda's local specific product in Vietnam and not typical of their other markets.

Enjoy Issue 3! In Issue 4, I will be explaining IJOEM's editorial restructuring and announcing some important personnel changes among the editorial team.

Yusaf H. AkbarAssociate Professor of Management, Central European University Business School, Budapest, Hungary