Subject category:
Strategy and General Management
Published by:
Ivey Publishing
Version: 2014-10-10
Length: 7 pages
Data source: Field research
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Abstract
Shanghai NSE Electric Co. Ltd. (NSE), a medium-sized manufacturer of marine switch panels, had entered into a joint venture with Schneider Electric under which NSE was Schneider's sole technology licensee in China. NSE felt fortunate because the world shipbuilding market was strong and orders were often full. With comprehensive and close cooperation, NSE was confident in Schneider. Nevertheless, Schneider announced that it would issue a second license to NSE's outsourcing manufacturer, SaierNico Electric & Automation. This meant that a competitor that produced and sold products of the same brand would emerge in the Chinese market. What was worse, this competitor had been cultivated by NSE. The CEO of NSE believed that NSE had three options: (1) continue to cooperate with Schneider; (2) broaden its business and cooperate with other powerful companies; or (3) invest more in local innovation to develop its own brand.
Subject category:
Strategy and General Management
Published by:
Ivey Publishing
Version: 2014-10-10
Length: 9 pages
Data source: Field research
About
Abstract
Shanghai NSE Electric Co. Ltd. (NSE), a medium-sized manufacturer of marine switch panels, had entered into a joint venture with Schneider Electric under which NSE was Schneider's sole technology licensee in China. NSE felt fortunate because the world shipbuilding market was strong and orders were often full. With comprehensive and close cooperation, NSE was confident in Schneider. Nevertheless, Schneider announced that it would issue a second license to NSE's outsourcing manufacturer, SaierNico Electric & Automation. This meant that a competitor that produced and sold products of the same brand would emerge in the Chinese market. What was worse, this competitor had been cultivated by NSE. The CEO of NSE believed that NSE had three options: (1) continue to cooperate with Schneider; (2) broaden its business and cooperate with other powerful companies; or (3) invest more in local innovation to develop its own brand.
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Subject category:
Strategy and General Management
Published by:
Ivey Publishing
Version: 2014-10-10
Length: 9 pages
Data source: Field research