Nomura Integrates Lehman Brothers in Asia and Europe Case
Case Analysis
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Nomura Integrates Lehman Brothers in Asia and Europe Case
1. What is the strategic fit between Nomura and Lehman?
According to the definition postulated by the textbook, “strategic fit” is the matching of corresponding strategic capabilities (Peng, 2013). Due to the fact that Lehman has valuable and rare talent, it would be wise of Nomura to acquire the values of Lehman in order to merge his capabilities. This will lift the weaknesses of Nomura with the strengths or talents of Lehman. As a result he will be able to persuade more clients and a very large team of employees so that Nomura would turn out to be one of the topmost players in the financial market.
2. Is there any organizational fit? How to bridge the gaps between the cultures of these two firms?Based on the case, it can be considered that there is no organization fit. When Nomura opted to get the services of Lehman within 24 hours, there did not exist organization fit. Nomura did not evaluate how Lehman would fit into the organization but rather she just noted the advantages anticipated for his entry to the firm. It is difficult as indicated in the case for a hierarchical Japanese firm to merge with a divergent New York Bank. Here the biggest problem is post-acquisition. Organization fit is as important as capital but this lacked in the case.
3. How does Nomura alleviate the concerns of multiple stakeholders?One of the keys measures that the organization undertook was to consider its stakeholders as a valuable asset towards its success. For this reason the key stakeholders were the employees. For example, Nomura was able to consider the validity of their former ex-Lehman’s employees back to their working team. This was an ideal step towards the success of the company today. This employees offered reliable and outstanding labor. Therefore, it can be considered that the management of Nomura took the basic concerns of the stakeholders as a valuable asset (Hill, Jones & Schilling, 2014).
4. How would you predict the effectiveness of Nomura’s transformation after this acquisition?
Since the acquisition of Lehman’s Europe and India, Nomura is expected to undergo changes in its human resource, governance structure and business. This is also expected to be described as “Lehmanization” of Nomura’s business venture. Many of the changes is expected to be planned from the onset, some of the main changes are response from the turn of activities and events. The case of Nomura acquisition offers an important lesson for cross border acquisition. This will permit divergent of corporate cultures.
Moving Headquarters Overseas Case
1. What are the drawbacks and benefits associated with moving business unit and corporate
HQ to another country?
The benefits
One of the merits of undertaking a movement of a business unit of Shifting the HQ is that the organizations gains global recognition. Secondly, this helps the organization to be close to its shareholders as well as main stakeholders and a result the firm will increase its flexibility as well as build its communication. Thirdly, the firms also benefits from the commitment derived from the host’s country laws and policies. Lastly this builds the companies political commitment and motivation.
Drawbacks
The prominent drawback of such moves is that there are heavy financial constrains faced by MNE’s during the move. The second is that the company may face cultural dilution or challenges since different countries have different business culture.
2. If you were a CEO or a business unit head, under what conditions would you consider moving HQ?
There are various conditions that would prompt me as the CEO of an organization to move the HQ. Some of the reasons are:
If the host country laws are not conducive to the business. Examples of such a laws are those that hinder business expansions (Berger, Choi & Kim, 2011).
If the current host country has heavy taxes as compared to the moving country of nation
The last condition is if the target market is varied hence profit maximization
3. If you were a government official in the MNE’s home country, what can you do to discourage such moves of multinational HQ out of the country?
The movement of such MNE’s HQ to other countries may cost the host country, therefore as a government official I would:
Amend the laws that ought to be changed in order to favor such companies or firms.
To offer the MNE’s reliable business environment like that of the target country (Peng, 2013).
Li and Fung Case Study
1. From a VRIO standpoint, what distinguishes Li & Fung from suppliers, buyers, and other intermediaries?
Value: The Company is working towards competing effectively with suppliers, buyers as well as other intermediaries. It is able to reduce cheap supply chain services to its clients in order to complete effectively.
Rarity: The Company has vast assets to be able to complete with other intermediaries in the market. In addition, the organization has extensively increased its resources by buying more assets such as that of Liz Claiborne.
Imitability: Li & and Fung has always changed its business strategies and never imitated other buyers or intermediaries. This is to ensure uniqueness of services.
Organization: Li and Fung has a well-established organization structure that distinguishes it from other suppliers, buyers and intermediaries.
2. Intermediaries such as Li & Fung need to be paid. After paying Li & Fung a fee, why do buyers
and suppliers still find it valuable to deal through an intermediary? In other words, why don’t they
trade directly?
It is worth to consider using intermediaries in supply chain management. The value of using an intermediary such as Li and Fung are diverse. One of the reasons for not buying directly is that the costs of buying directly is hire as compared to using the intermediary. This is because the cost of intermediaries is down due to the fact that they undertake or delivery services in bulk. Hence the cost is shared amid buyers.
3. Why was Li & Fung able to emerge stronger during the 2008–2009 global economic crisis?
The company shinned even better in 2008-2009 because it was able to merger with other companies hence able to diverse its services as well as customer base. In addition, the company acquired additional assets such as acquisition of Liz Claiborne which increased its global recognition and its target market.
Cut Salaries or Cut Jobs
1. What are the benefits of across-the-board pay cuts?
There are various benefits that come with across-the-board pay cuts. However, for the case of this paper main benefits will be addressed as below:
This will not reduce the morale or the motivation of the employees as the cut will affect employees across board. In addition, it is also worth to note that such pay cuts has limited effect on the rates of inflation as the hominization of the rates are done as a whole. Lastly, across-the-board-pay cuts are beneficial in that it is always reached between a decision done by both the management and the employees.
2. What are the benefits of reduction in force (mass layoffs)?
The benefits if layoffs only lies on the company as it lacks benefits towards the employees. With respect to the company, it is the easiest way of reducing cost of production. In addition, it encourages easy manageability of employees (Berger, Choi & Kim, 2011).
3. How would you advise this Japanese expatriate working in the United States?
With reference to the case, it would be better if the Japanese expatriate considers across-board pay cuts. This will not only be advantageous to the organization but also to the employees. Moreover, United States laws permit across board pay cuts as compared to layoffs especially when dealing with foreign companies.
References
Hill, C., Jones, G., & Schilling, M. (2014). Strategic Management: Theory: An Integrated Approach. Cengage Learning.
Berger, R., Choi, C. J., & Kim, J. B. (2011). Responsible leadership for multinational enterprises in bottom of pyramid countries: The knowledge of local managers. Journal of business ethics, 101(4), 553-561.
Peng, M. (2013). Global business. Cengage learning.
