The key strengths of the Korean electronics industry during the formative years include:
- creating highly favorable business environment that was aimed to attract international partners from developed countries, who were willing to invest into a newly-appeared, ambitious company;
- introducing well-developed policies and strategies that contributed to the growth of the industry thereby reinforcing foreign direct investment;
- saving money by starting as a labor-intensive but low-tech industry;
- focusing on technological innovations when it became cost-effective;
- close and fruitful collaboration between the state government and the chaebol, which made it possible to achieve the common goal in a shorter period of time;
- good chances to bring the national technological industry to a new level;
- entering joint ventures with the leaders of the market;
- doing indigenous research to achieve high quality;
- having a lot of manpower (since technology and science were the key areas of education).
In order to enter developed-country markets, firms leveraged these benefits by:
- establishing connections with global market players;
- taking advantage of the opportunities that were provided by their experience of entering joint ventures with companies from the developed countries;
- using their personally developed know-how in emerging technologies due to the efforts of the company’s research department.
Distinct patterns and commonalities in terms of LG’s approach to developing markets of the BRIC countries can be summed up as follows:
- developing strategies that managed to combine research and development, sales orientation, and effective localizations patterns;
- opting for a long-term approach for all the new markets (in Brazil, India, China, and Russia);
- attempting to develop connections with the governments of the four countries to obtain business advantages;
- being patient and trying to stay afloat even during medical and economic crises in China, Brazil, and Russia;
- getting deeply involved in the Indian market by targeting all its related segments;
- producing localized products in India and Brazil;
- acting as one of the major sponsors of sports in India and Brazil;
- launching effective educational and medical programs in China and India;
- giving autonomy to employees in China and India in order to foster innovation and win trust;
- focusing on research and development in India, China, and Russia to be able to use local knowledge and skill to the company’s benefit.
The critical points of learning from the company’s success include:
- distributing resources for a long time ahead;
- creating brand image that wins the customer’s recognition and trust;
- getting support of partners and stakeholders.
All the advantages are transferable to the developed markets due to their universal character (yet, the level of requirements will be much higher). They can be leveraged by:
- poisoning all the company’s value elements in the location where there is a demand for them;
- fostering software development;
- forecasting industry trends;
- opening centers of research and development to study the market;
- tailoring products to make them answer the requirements of the population;
- creating brands that would meet quality standards of the developed markets;
- making emphasis on quality rather than on the “Goldstar” image;
- launching country-specific campaigns;
- maintaining presence in all the countries equally to become a locally recognized market player;
- establishing connections with governments to bring the entry risk to the possible minimum and ensuring compliance with local laws;
- entering alliances with other companies in order to have better understanding of the market and the customer.