Question

Case study: Suppose EcoPure Industries, a manufacturer of components for hybrid motor vehicles, hires you. EcoPure emphasizes social responsibility in its business dealings and uses three foreign market entry strategies: exporting, joint ventures, and FDI. Exporting implies the sale of products to customers located abroad, usually under contract with foreign intermediaries that organize marketing and distribution activities in local markets. Using joint ventures, EcoPure partners with foreign firms to access their technology, expertise, production factors, or other assets. Using FDI, EcoPure invests funds to establish factories or other subsidiaries overseas. Each of the strategies—exporting, joint venture, and FDI—is vulnerable to particular types of ethical dilemmas, and top management has directed you to identify and describe the most typical ones. YOUR TASK: Using the ethical framework and other material in Chapter 4 as a guide, what types of ethical problems might arise in each type of entry strategy? Which entry strategy most likely gives rise to ethical problems? Be sure to justify your answer.

Answer 1

Ethical dilemma :

A specific situation of dilemma where you are left over in a option to decide which is ethical and which is non ethical. but irony seems to be that neither of the options constrain themselves to be fully benificial.

Irrespective of any industry these ethical dilemmas emerge , evolve and observed.

thus the items to be discussed here are those possible ethical dilemmas observed / ethical problems to be faced in various situations of hybrid motor manufacturing industry , EcoPure.

Entry Strategy	situation	ethical dilemma
1. exporting : it is a process where EcoPure ties up with various foriegn intermediaries in order to sell its own country produced motor vehicles in foriegn local markets.	* criteria to consider specific foreign intermediary unit.	* to consider those units which are with values and work structure similar to EcoPure / with those units which gives maximum profits to our industry putting aside their work nature and business values.
	* to let those intermediaries advertise the motor vehicle towards local customers.	* the advertising strategy , pricing strategy etc whether in identical to pricing system with which the institution grounded consumer base is formed / to compromise with their trending eras. eg : 1 motor bike pricing criteria in india is * mileage , seating capacity , availability of spares , fits in budget of normal middleclass person where as these criteria may not stand same matter of importance in other foreign countries. so now industry is in dilemma to risk its over the years followed strategies at the cost of huge share capitals or not.
	* what if foriegn intermediaries fail in obtaining profits.	* if the output of above listed ehical dilemmas turn fruitful opting better choice then its okay. but if does not work out then the situation to bear those consequences is other ethical dilemma to whether adapt reserved strategy , deal the situation / stop these strategies. if stoped then what is reasonable next strategy ??
2. joint venture : this is a process where industry collides with foreign manufacturing units to see , learn , understand and adapt those technologies , trends , expertise and production factors etc.	* when one unit tries to mingle with other , many contraversial aspects are found.	* those wphich are considered non acceptable in our unit may found to be acceptable here. then if employees are sent to joint ventured workplace then what shall he / she have to follow ?? what shall be ignored ??
	* technological farwardness may be observed in these foriegn units as well as dumb practices like excess use if resource can be found.	* dilemma is whether to invest excess in those unneccessary aspects of production ?? / let it go since that is the main important factor being considered to capture consumers attention. * dilemma is whether to implement these technologies ? / those our own proven technologies which attracted mindset of consumers.
	* valuing the expert opinions of both units.	* sometimes the expert employees in one unit may not agree to that of other where as their opinions and strategy uses may also be completely opposite. then a situation arises on which one to be trusted better.
3. Foriegn direct investment : to start a factory / subsidary in foreign country / place / overseas.	* whether the perks in this regard are valuable.	* the benifits being generated via this investments include risking of various stakeholders financial dreams. * whether that specific place to set place of business will serve our financial needs , benifits us both ethically and financially ??
	* how to handle war situations / rules changed in inter countries agreements.	* the foreign direct investments abide by inter country agreement treaties made. whether these treaties help your vision and mission to grow. eg : company dreams to launch sports model motor vehicle at budgetray prices. the agreement made with india and X country includes a statement i.e sports models attract highest rate of tax in purchase of raw materials. now this effects the cost of production and unit cant give sports model @ budgetary price which completely hinders the purpose of such production.
	* maintainance cost of employees	* the subsidaries being located in foriegn country may be observed to be @ low cost in all aspects due to currency value of holding co country. but few structural changes by their government may now end up raising their value of currency and this increase our maintainance cost as a whole in greater numbers.

thus , by observing all the situations it is clear that irrespective of what kind of entry strategy may be used the ethical dilemmas are unaviadable.

thus the only thing lies in EcoPure hands is to clearly analise possible alternatives and understand the higher risk / actual amount if risk involved in which strategy.

as per my understanding ,

■ if company want to capture foreign local markets , then the company has to associate with those intermediaries

* abiding to companies objectives / similar visions

* minute modifications as per tastes and preferences as per their local customers.

* to enter safe zone in earlier stages i.e to target those countries with similar tastes to that of our own country.

■ if company wants to educate evolve and develop itself in foreign countries then

* adapt to those countries situations. since it is always said that when in rome behave as roman.

■ but if company want to spread its own flavour to outside countries ,

* set subsidaries at those places whose tastes are similar to that of our countries and cost of production there gives reasonable profits.