Global Business 　（ Chap 4)

Dept of Technology Management for Innovation (TMI), Graduate School of EngineeringProfessor Kazuyuki Motohashi

工学系研究科 技術経営戦略学専攻教授元橋一之

http://www.mo.t.u-tokyo.ac.jp

Development in emerging economiesSuch as China and India

New competitorsNew markets

Global Business Strategy• Shift to “good enough market” and improvement in

cost competitiveness• Business model re-organization by service dominant

design (Product base -> Complex system integration business)

World in not so flat,

understanding distance

Consistency with corporate

strategy

World GDP ShiftDeveloped ->

Emerging Econ, such as BRICs

Catching up of Firms in Emerging

Economies

Competitiveness index by products(Export-Import)/(Export+Import)

Decreasing international competitiveness

Difference in product architecture

Integrated architecture Modular architecture

Product architecture and value creation

Size of value added

Level of complexity (difficulty in imitation)

Aircraft(CoPS)

Auto-motives

EV?

Mainframe computer

ModularizationUnbundling, com

petition

PC

IT servicesService

scienceScalability in

services?

“Smile” Curve by IT and globalization

ProfitH

ighLow

Value ChainUp stream Down stream

Assembly

PartsDesign Customer Service

Modularization by Digitalization

&Fragmentation of production

activities world-wide

Response to competitive pressure from catching up economies

Size of value added

Level of complexity (difficulty in imitation)

Aircraft(CoPS)

Auto-motives

EV?

PC

Scientific approach for innovation (digitalization, modularization..)

and technological catching up

Gro

win

g “G

ood

Enou

gh M

arke

t”

Protection of propriety technology (IPR), increasing complexity, strategic

investment in complex system innvation

PV panel

Service Dominant Logic of Marketing(Vargo and Lusch, 2004)

　 Product Dominant Logic Service Dominant Logic

Unit of Exchange in the market Product, itself

Customer utility by using product, skills and expert knowledge embodied in the product

Role of product Unit of market exchange Intermediate entity to create customer utility

Role of customer Passive as a product userActive as a co-developer (innovator) to maximize utilities by using the product

Determinant of product value Producer

Customer （ Producer as a value proposition entity, a final value should be decided by the customer ）

Source of value added Exchange of tangible products and managerial resources

Exchange of skills and expert knowledge embodied in the product

What is complex service system?

Complex system of products

Operation and Controlling Functions

Value Proposition to the customer

Low cost/ high

performance

Local environment Organizational factors

Example: Railway as a complex LTS

Geyer and Davis, Research Policy 29 (2000), pp. 991-1013

UK system of operation (after EU directive)

Geyer and Davis, Research Policy 29 (2000), pp. 991-1013

German system of operation (after EU directive)

Geyer and Davis, Research Policy 29 (2000), pp. 991-1013

Introduction: Neemrana Industrial Park

Mumbai（ Bombay ）

Dehli

NeemranaRajasthan State

Gujarat State

Hariyana State

DMIC(Delhi Mumbai Industrial Corridor)

Chennai（ Madras ）

Bangalore

Pune

Gurugaon

② Mitsui Prime 09-6

Mega solar power plant(NEDO demonstlation

project)

Mega solar power plant(NEDO demonstlation

project)

Logistics center

Logistics center

- Improve logistics efficiency- Reduce environmental burden

- Water treatment system- Water park

- Water treatment system- Water park

- Gas power plant

- Control server

- Gas power plant

- Control server

Contribution Stage 2 (to Indian companies

(Power, Water treatment service and Logistics information to Phase1,2 area )

Phase 1 、 2 （ Indian companies area)Phase 1 、 2 （ Indian companies area)

Phase 3 （ Japanese companies area)Phase 3 （ Japanese companies area)

Information of traffic

conditions

Information of traffic

conditions

Contribution Stage 1(Power, Water treatment and

Logistics information to Phase3 area)

Water treatment system- Contribution to environmental

protection- Collaboration with power plant- Increase water efficiency

Neemrana Smart Factory Plan