Introduction
Globalization of business is crawling across nations’ boundaries at an ever increasing rate. Everyone wants to get in on this seemingly untapped growth potential. A recent article about Dell, an American company that makes computers, states the company is looking to expand its market into the Far East (Patrizio, 2007). While expansion’s potential for growth is good, an equal potential for failure exists.
Challenges
Going across the ocean into the Orient may hold great challenges ahead of Dell. The article does not mention the details, or even the country or countries that Dell would like to set up shop. Only the region is mentioned which is the Far East.
Countries such as China, Vietnam, North and South Korea, Laos, Philippines, Japan, Malaysia, Indonesia, et al. are all part of the Far Eastern region. Languages and cultural differences vary vastly in the Asian areas, thus communications between the countries and Dell could become strained. Exchange rates, distributorships, repair parts, and other logistical considerations must be dealt with to ensure a seamless emergence into the Far East markets.
Shipping a product overseas or establishing a local assembly operation would be another consideration as to which may be the most cost-effective. Currently, Dell has an assembly operation in Malaysia, so increasing production at that location to fill Far East demand would at least seem to make the most sense. In doing so, this could severely impact product shipments locally in the U.S. as then the shipping operations could be completed overseas.
Toshiba, Sony, and other regionally-based computer manufacturers probably would not sit idly by and let Dell conquer unmolest ...