An examination of the use of business alliance by transport providers for entry into China market

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An examination of the use of business alliance by transport providers for entry into China market


Author: Tong, Kit-ling
Title: An examination of the use of business alliance by transport providers for entry into China market
Year: 2003
Subject: Hong Kong Polytechnic University -- Dissertations
Strategic alliances (Business) -- China -- Hong Kong -- Case studies
Business logistics
Department: Dept. of Shipping and Transport Logistics
Pages: 95 leaves : ill. ; 30 cm
Language: English
Abstract: Globalization is not only the trend of international trade, but also facilitating the demand of strong national and global-wide transport network. In addition, the China's accession to the WTO is an opportunity as well as a challenge to Hong Kong transport operators. It is commonly believed that Hong Kong transport operators can play a strategic role to improve transportation and logistics market in Mainland China and thus provide business opportunities for them to excel. However, approaching to right direction needs appropriate strategy to achieve business goal. Business alliance is now widely accepted by managers as a way of doing business. This study would like to explore four inter-related areas, (1) impacts on and opportunities to Hong Kong transport operators due to China's attainment of WTO; (2)How business alliance help MNC transport operators to expand their business in different geographical markets, (3) Currently, how do Hong Kong transport operators enter China passenger and freight markets? (4) To what extent "business alliance" could be a "short-cut" for Hong Kong transport operators to enter China market? The four case studies were attempting to find out how Hong Kong based MNC and local bus company form their business alliances and advantage or the reasons behind such business decisions. Besides, through these case studies, we could understand the methods used to build successful business alliances. For example, in the case of Cathay Pacific, we learnt that an ideal airline alliance partnership should consider four main issues: relative size, culture, uniformity of product and regulation. Evidence in the Orient Overseas Container Line (OOCL) and Grand Alliance case, in contrast, showed how a centralized service center could strength the affiance and reinforce the synergy effect. The case studies of Hong Kong Bus Companies told us that the "relationship network" of PRC partner determinates the scale and potential of market development. Business alliance requires compromises among members that make it imperfect. However, Hong Kong transport operators need to compromise with their scarce resources. From the study, we can see that firms use alliances to combine capabilities and strengths, thus creating a competitive entity that is stronger than individual members could be by themselves.

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