The case narrates the story of the Rodamas Group, owned by the ethnic Chinese Tan family in Indonesia. After Indonesia started to set out on an industrialization plan in the late 1960s the company started in 1951 as a trading business and, over time, became a joint venture partner in manufacturing businesses with a range of largely Japanese associates. In the 1980s, the corporation was slowly transferred to the second generation organizer, and constantly grew and prospered until it became part of the top-20 business groups in Indonesia. The part of Rodamas in these partnerships was to handle local regulations, hire local employees and distribute the products in Indonesia. When the then President Suharto was toppled in the Asian Crisis in 1998, Indonesia experienced several radical changes, including the transition to democracy. Its market became more open, and foreign companies were permitted to operate in the state without having a local partner.
Moreover, several global business developments, including the tendency of multinationals to rely on consultants and lawyers rather than local equity partners, jeopardized the Rodamas business model. In view of this, Mucki Tan, the current leader, is reconsidering the future of his company and weighing a few alternatives. The case ends with these tactical options: 1) internationalize with existing associates; 2) develop own companies that need small technology, like property; 3) buy present manufacturing firms; 4) focus on distribution of products for foreign multinationals; 5) focus on a conventional partnership function with a new wave of foreign direct investment (FDI) from developing market multinationals, more specifically, China. Pupils are requested to examine its surroundings and the company, decide on a tactical direction and reflect on the results.
PUBLICATION DATE: June 23, 2009 PRODUCT #: 909M49-HCB-ENG
This is just an excerpt. This case is about GLOBAL BUSINESS
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