KPMG's analysis points out that enterprises are at different stages of development, with different strategic goals and market choices, and how to choose the mode of overseas market entry is often a major challenge for enterprises going overseas. In general, the modes of enterprises going overseas include: cooperative general agency, authorization, direct greenfield investment in the sales channels of the target country, and the acquisition or establishment of joint ventures with local production enterprises and channel providers. Different enterprises also have different advantages and disadvantages in going overseas, such as: greenfield investment can obtain full profits, full control of core technology, production process, management and sales and other assets; However, it also has the disadvantage of high investment resources and long return on investment cycle. Therefore, enterprises need to take their own capabilities and strategic development direction as the basis point, clarify the business purpose and financial goals of going overseas, and carefully plan the mode of going overseas in combination with upstream and downstream planning, and from the consideration of the long-term development strategy after going overseas.
According to KPMG's report, the most critical aspects of overseas market expansion are the control of key time points such as qualification application, construction schedule, merger transaction approval and personnel recruitment in the destination country. In order for a project to run smoothly, companies must accurately plan and manage these steps.
Lack of coordination mechanism for overseas operations
In the implementation stage of overseas operations, enterprises may encounter problems such as lack of operational coordination mechanisms, including a lack of macro vision in supply chain planning, diversification of compliance risks, and poor implementation of digital management. These problems will affect the operational efficiency and synergy of enterprises in overseas markets. KPMG pointed out that when companies decide to expand overseas, they need to deal with a variety of challenges, such as the incompatibility of the domestic sales model with the local market, competition and cooperation with local distributors, price control, and the achievement of sales targets. When planning a channel strategy, companies also need to consider a series of key issues, such as the positioning of target customers, the company's medium- and long-term development plan, the assessment of expected investment and returns, the time required for expansion, and the main challenges that may be faced. The comprehensive consideration of these factors will provide key guidance for companies to successfully enter and expand overseas markets.
Figure: How China's manufacturing industry can better cope with the challenge of going global
In addition, overseas enterprises often lack differentiated strategies for attracting, developing, stimulating and managing local talents, and they also need to deal with the challenges of local employee protection policies. With the intensification of challenges such as the increasing strategic importance of overseas markets and the competitiveness of overseas talents, the challenges of overseas human resource management have also followed. Recruiting and managing employees in overseas markets is a complex process. Companies need to understand local labor regulations and cultural context. For example, employees in different countries have different expectations for working hours, benefits, and career advancement. In some European countries, work-life balance is more important and companies need to provide benefits such as longer paid time off. There are also difficulties with communication and collaboration in multinational teams. As employees in different countries may have different working styles and communication habits, team cohesion and productivity may suffer. For example, in a project team with employees from different countries, time differences, language barriers, and cultural differences can lead to poor information transfer and delays in work schedule.
KPMG's analysis report points out that in recent years, the digitalization and digital industrialization of the manufacturing industry have been deeply integrated, and various manufacturing and production activities are highly dependent on the investment and management of data resources. However, in the process of promoting the digitalization of Chinese manufacturing enterprises, there are problems such as low data transparency and traceability that need to be enhanced, and the non-integration of information systems will also affect the scientificity of decision-making. Due to the inability to obtain complete and accurate overseas market data, such as sales data, market trend data, etc., the senior management of enterprises may have deviations when formulating overseas strategies, and cannot accurately grasp the dynamic changes of overseas markets.
Therefore, Chinese manufacturing enterprises need to comprehensively consider the key aspects such as planning, execution and landing operation in the process of going global, and innovate and optimize in terms of global talent strategy and digital transformation to solve the problem of lack of overseas operation coordination mechanism.
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