We learned today that every corporation must decide its directional strategy. Keeping that in mind. Let's look at Briar Industries orientation toward growth. Briar Industries entered the Latin American market in the 1960s by forming a joint venture with Industro Bieje in Santo Ignezeto to manufacture bicycle parts. The joint venture flourished in the 1960s, and Briar eventually bought out 100% ownership. The company earned steady profits from the Latin American subsidiary until a military coup overthrew the government in the late 1980s. The ruling generals expropriated all foreign owned companies, including the Santo Ignezeto bicycle parts plant.
Today Santo Ignezeto is ruled by a democratic government that has been in power for ten years. Industro Bieje has approached Briar about another joint venture. The government is offering an attractive incentive package to attract foreign investment. You have been assigned to travel to Santo Ignezeto and begin planning and staffing.
1. Please define and explain the directional strategy Briar Industries is forming.
2. What are the potential problems that face the new endeavor?
3. What are the potential advantages of this endeavor for the company?
4. Would you recommend hiring local managers or American managers for the top and middle management positions? Why or why not?