School of Management — MANU2470 Assessment 3: Proposal Assessment Type: Proposal (individual) Due date: Thursday of Week 7 at 23:59 (Melbourne time) Weighting: 30% Word limit: 3000 words (+/– 10%)...

INTERNATIONAL BUSINESS                                1
INTERNATIONAL BUSINESS                                 17
INTERNATIONAL BUSINESS
DATE OF SUBMISSION: _______________________
TITLE OF REPORT: ASSESSMENT 3: PROPOSAL AND RECOMMENDATIONS
STUDENT NAME AND NUMBER: _______________________
COURSE NAME AND CODE: _______________________
TUTOR NAME: _______________________
Table of Contents
Executive Summary    4
Introduction    5
Modes of Entry    5
a) Exporting:    5
Benefits:    5
Challenges:    6
) Joint Venture:    6
Benefits:    6
Challenges:    6
c) Foreign Direct Investment:    6
Benefits:    7
Challenges:    7
d) Strategic Acquisitions:    7
Benefits:    7
Challenges:    8
e) Licensing:    8
Benefits:    8
Challenges:    8
Strategies    9
a) Human Resource Planning    9
) Performance Management    10
c) Training and Development    11
d) Remuneration    12
Analysis of Appropriate Factors Considering Different Groups of Employees    13
a) Home Country (Germany) Nationals    13
) Host Country (Choose any1 South Asian Country) Nationals    13
c) Neither Home nor Host Country Nationals    13
Expats    13
Work Experience    13
Educational Qualifications    14
Skills    14
Managers and Workers    15
Conclusion    15
Recommendations    16
References    17
Executive Summary
The assignment is a report presentation for Solawerk AG, which has plans to expand its wings in one of the leading South Asian markets, as it has few customers including one major buyer in telecommunication industry.
The purpose of the report is to suggest right strategic plan. The initial section of the report discusses about various options available with the company to enter the market. It will help to decide on suitable one and to proceed with it. The next section deals with various strategies of human resource management such as planning, performance management, training and development of employees and remuneration parts as it will be the major support system for organizational setup.
The human resource will be having major impact on the successful implementation of the plan. The later section of the report will be concluded at the end followed by recommendations, which will help to reach the strategic action after analyzing the options and strategies as discussed.
Introduction
Solawerk AG is a German company and is interested in expanding in one of the South Asian countries. The reason behind is high production costs. The selected country is India, which has huge growth potential for company. In this proposal, there will be discussion on various modes, through which it can enter the market along with benefit and challenges it will come across as well as the various strategies, which can help it to expand successfully (Hoffman et al., 2020). The report will be concluded and recommendations will be given to provide help to take decisions for tapping new market and reducing cost of production.
Modes of Entry
In order to enter in the market of India Solawerk AG has following options:
a) Exporting:
It is one of the most simplest and prefe
ed forms of entering a potential foreign market. The products, which are manufactured by the company, are sold off to the buyers in India directly. It will help the company to operate with its cu
ent production line by following existing business model. The importers will distribute the product to the final consumer according to their demands (Annushkina & Regazzo, 2020).
Benefits:
It provides market, which has no limits. In any quantity, the company can sell its product to international market. It
ing more money to home country. The home government also support certain kinds of incentives, which help to boost the production function of the company. The home country product can be sold in international market for higher price being its unique features.
Challenges:
The main challenge is to find the right potential buyer for the product. The cu
ency fluctuation may results in loss of profit in deals. The product should meet quality standards. The import duties of desired market should be favorable to importers.
) Joint Venture:
Joint venture is a kind of strategic alliance between two parties or companies with a motive to target market and utilize the pool of resources created by their combination. As suggested by Vyas-Doorgapersad (2020), the motive can be a business activity and it helps to leverage the expertise of both the companies. JV has separate identity from its founders and it contributes in gaining competitive advantage in the market over competitors. Solawerk AG can also enter into a JV with a company of similar interests such as Havells or Tata, which have strong presence in the market and dependable distribution network.
Benefits:
It helps in exploring new markets and distribution channels. It also results in increasing the capacity of the company. The main advantage is that costs and risks are mutually shared. The use of expertise is optimum here. For example, one has expertise in producing innovative products and there has expertise to penetrate in the market.
Challenges:
The biggest challenge is the expectation from the joint venture, which is normally different for the parties involved. It often leads to communication gap and in worst cases even dissolution of JV. The culture, management and distribution of resources can act as ba
ier in the smooth functioning of the JV.
c) Foreign Direct Investment:
It is an opportunity when companies invest in foreign market as per host country’s policies. It can be done in two ways:
(i) By setting up a new venture and
(ii) By acquiring existing company.
It helps in transfe
ing of knowledge, skills, technology and resources. It helps to produce cost effective goods in target market and save on import taxes. It also give benefit of availability of cheaper labor and raw materials. It gives competitive advantage to the company.
Benefits:
It helps in improved fund flow in the countries, create more employment opportunities and scope for growth. It helps in
inging new technology and development of human resources. It helps to exploit other resources so that economies of scale can be achieved.
Challenges:
It may lead to stringent labor laws. It may hamper local players, thus spooling competition. It can create monopoly of foreign company leading to unfair trade practices. It can also lead to change in government policies, which might not be favorable for importers.
d) Strategic Acquisitions:
When a company acquires controlling rights or interest in an existing company in the overseas market it is known as strategic acquisition. The acquired company may deal in same business or involve in offering other product or service in the market directly or indirectly. This helps in retaining cu
ent management by utilizing their experiences, knowledge, expertise and team.
Benefits:
The availability of readymade infrastructure, access to established distribution network act as assets for the acquirer company. It helps to take leverage of the resources and establish well in the market. It saves time for setting up the unit. It also helps to evolve better business model for local market (Zajacz, 2019).
Challenges:
There can be clash of cultures and the product offered proves to be less differentiated from the home market. It can be a challenge for the
and to make its place and create financial issues in future.
e) Licensing:
It is an option, which provides low risk and retail presence in foreign market. It also led other company to bear the risk on behalf of the company. An inflow of royalty or commission is introduced in the system and the home company give access to use the
and image, product, trademarks and other intellectual properties related to the business for sales and marketing. Bordunos and Kosheleva (2018) indicated that it helps to share the profit and risks in ratios as decided.
Benefits:
It helps to create more business and revenue opportunities for the parties involved. It distributes the risk and proves to be easy entry mode in foreign markets. It also create self-employment options in host country.
Challenges:
It can lead to piracy of the product. It creates tough competition in host country. The business is solely dependent on the license as it for limited time span only and in case of cancellation, it leads to huge losses of investments. It can also contribute in denting the image of both the parties due to
and issues (Schwens et al., 2018).
The attractive modes of entry by which Solawerk AG can successfully enter Indian market are:
    Prefe
ed mode of entry
    Benefits to company and host market
    Foreign Direct Investment
    As the production costs are higher for Solawerk AG in Germany it can plan to set business unit in the host country. Under Make in India policy government of India is welcoming MNCs to set up unit. It is also providing incentives and tax rebates. It will help to
ing down the production costs.
    Joint Venture
    To penetrate the market deeper right from the beginning the company can enter into joint venture and explore new possibilities in tapping potential market. It will help it to share the risks and take advantage of the extpertise of the host country company. It will help to acquire...