chapter 4 corporate strategies for global management and competitiveness for sm es
TRANSCRIPT
Service. Minding. Esteem. Awareness
Corporate Strategies for Global Management and Corporate Strategies for Global Management and Competitiveness for SMEs: Competitiveness for SMEs:
The Most Case of TaiwanThe Most Case of Taiwan
by Prof. (Dr.) Kao Kveng Hong
Service. Minding. Esteem. Awareness
ContentsContents
I. SME in Taiwan at GlanceI. SME in Taiwan at Glance
II. Global Strategy of SMEs in Taiwan II. Global Strategy of SMEs in Taiwan
III. Best Practice Example III. Best Practice Example
IV. Future Global Strategy PlanIV. Future Global Strategy Plan
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Service. Minding. Esteem. Awareness I. I. SME in Taiwan at GlanceSME in Taiwan at Glance
About TaiwanAbout Taiwan
Area: 36,000 sq. km
Population: 23 million
GDP per Capita: US$20,423*
Foreign Trade ( goods ) :
World’s 18th largest trading nation*
Number of Enterprises: 1.33 million*
Number of SMEs: 1.30 million*
Ratio of SMEs to All Enterprises: 97.67%*
--
Source : White Paper on SMEs in Taiwan, 2013 Department of Statistics, Ministry of Economic Affairs, 2013
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Criteria for Identifying SMEsCriteria for Identifying SMEs
SECTORS SMEs Micro Business
Manufacturing, Construction, Mining, Quarrying
Paid-in Capital < NT$ 80 million(US$2.6 Million)
or Employees < 200 persons
Employees < 5 persons
Service,
Commerce
Preceding year revenue < NT$ 100 million (US$3.3 million)
or Employees < 100 persons
I. I. SME in Taiwan at GlanceSME in Taiwan at Glance
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The Current Status of Taiwan The Current Status of Taiwan SMEsSMEs
All enterprises SMEs % of SMEs
No. of enterprises 1,337,890 1,306,729 97.67Total employments (thousand persons) 10,860 8,484 78.12
No. of employees (thousand persons) 8,495 6,122 72.06
Total Sales (NT$ million) (US$ million)
37,649,075(1,254,969)
11,381,770(379,392) 30.23
Domestic Sales (NT$ million) (US$ million)
27,797,659(926,589)
9,633,690(321,123) 34.66
Direct Export Sales* (NT$ million) (US$ * *million)
9,851,416(328,381)
1,748,080(58,269) 17.74
*Indirect Export Around 50% / ** 1 USD = 30 NTD Source: White Paper on SMEs in Taiwan, 2013.
I. I. SME in Taiwan at GlanceSME in Taiwan at Glance
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Service. Minding. Esteem. Awareness
65~70%Foundation of SMEs
Middle Layer of
SMEs, Ltd. Co., 27~34%
Award StrategyAward Strategy
Guidance StrategyGuidance Strategy
Top SMEs, Ltd. Co., 1~3%
Grouping StrategyGrouping Strategy
1. National Award2. Rising Star Award3. R&D Award4. Business Start-up Award
11 Guidance Systems
1. Mutual Cooperation2. Industry Cluster3. Local Cultural Industry4. Financing Programs
Biz Startups
mechanism for supporting mechanism for supporting entrepreneurial activity & entrepreneurial activity & innovationinnovation
Conceptual Structure Conceptual Structure I. I. SME in Taiwan at GlanceSME in Taiwan at Glance
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Vision and StrategiesVision and Strategies
Integrating the SME financing mechanism
Building a platformfor business start-up
and incubation
Strengthening theSME managementguidance function
Creating a healthyenvironment for the
development of SMEs
Creating an environment beneficial
to the establishment and growth
of SMEs
Enhancing SMEs’information technology
capability
I. I. SME in Taiwan at GlanceSME in Taiwan at Glance
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Service. Minding. Esteem. Awareness
25% ICT
23% Bio
11% Machinery
5% Environment
5% Chemistry
21% Others
2%Tourism
8% Culture130+
75
34.51
Incubators
IPO Companies
Output/Input
2,959Startup Companies
4+4 4 NBIA Soft Landings+4 EBN BIC
6,305Incubated Companies
Incubating Domain
5.4%Of Taiwan Stock Market
Business Incubation in Taiwan Business Incubation in Taiwan I. I. SME in Taiwan at GlanceSME in Taiwan at Glance
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Service. Minding. Esteem. Awareness I. I. SME in Taiwan for a GlanceSME in Taiwan for a GlanceII. Global Strategy of SMEs in TaiwanII. Global Strategy of SMEs in Taiwan
127.97
130.67
133.12
125
127
129
131
133
135
2011 2012 2013
(in 10,000 firms)
8,337
8,484
8,588
8,300
8,400
8,500
8,600
8,700
2011 2012 2013
(in thousand persons)
99,584
95,954
98,821
94,000
96,000
98,000
100,000
102,000
2011 2012 2013
(firms)Number of firms growsNumber of firms grows
Created 8.5M jobsCreated 8.5M jobs
Net ~10,000 New SMEs Net ~10,000 New SMEs
Note: examples of knowledge-based services are ICT, professional, scientific and technological services.Source: Ministry of Economic Affairs; “White Paper on SMEs in Taiwan”
Growing number of Growing number of knowledge-based servicesknowledge-based services
SME Status and Trend in 2011~2013 (1/2)
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Service. Minding. Esteem. Awareness II. Global Strategy of SMEs in TaiwanII. Global Strategy of SMEs in Taiwan
SME Status and Trend in 2011~2013 (2/2)
Sources: White Paper on SMEs in Taiwan and Industry, Commerce and Service Census
Export Contribution and Propensity Down
Apparent Structural Change in Micro Enterprises
(in 10,000)2001 2006 2011 2006~2011
ACGR
Micro Manufacturer 61.79 74.46 14.88 -27.53%Micro Services 11.95 13.05 79.65 43.58%
Total 73.74 87.51 94.53 1.56%
2011 2012 2013
Export Value (in trillion NTD) 1.65 1.75 1.42
Export Contribution (%) 16.29 17.74 14.48
Export Propensity (%) 14.70 15.36 12.58
Annual Growth Rate (%) 1.85 5.95 -18.53
Products' technology content has increased, which infuses SMEs into the supply chain of larger enterprises, and thus suppressed SMEs’export contribution.
Over 1,000 SMEs have grown into large firms, and thus drives down SMEs’ propensity to export.
Facilitate the development of micro-manufacturers and put efforts into innovation and key IP in order to fuel the future growth engine in the post-financial crisis period.
Innovate the business model for micro-services, and boost the growth of knowledge-based services with potentials.
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Service. Minding. Esteem. Awareness III. Best Practice ExampleIII. Best Practice Example
O’right International: The sustainable green business Introduction Name : O’right International Founded : 2001 Primary Activity : Personal Care Product
Manufacturing Capital : 110 Million NTD
Green economic benefits:1. Annual sales reaches 240 million NTD, scaling 4 times from
2006, and employment has doubled2. Currently exporting to 25 countries, and the export growth rate
in 3 years is over 50% Green Recognitions:Gold Award and Special Award (2014), iF Design Award (2014), FT-
Standard Chartered Taiwan Business Award (2014), EPIF 2014 International Green Classics Award (2014), etc.
Sales 240 Million
Policy Support
Results
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Service. Minding. Esteem. Awareness IV. Future Global Strategy PlanIV. Future Global Strategy Plan
Comprehensive Strategy
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Accelerate the globalization of high growth SMEs
Bridging international resources and funds to build global high
growth SMEsSupport SMEs with high
growth potentialsOptimize the business environment
Reinforce operational capacityIncubate innovative
startupsLeverage inte-ministry resources to incubate startups with potentials
Develop common key factors and functional assisting resources for global markets
Promote high growth startups via the leverage of post-incubation mechanism
Targeted Strategy: The High Growth SMEs
IV. Future Global Strategy PlanIV. Future Global Strategy Plan
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Policy Derivitives
IV. Future Global Strategy PlanIV. Future Global Strategy Plan
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Service. Minding. Esteem. Awareness ConclusionConclusion
Taiwan, Your Best Business Partner!Taiwan, Your Best Business Partner!Taiwan has the world-class entrepreneurship and industrial cluster environment. We look forward to further cooperation with the other countries around the world.
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Thank you for your attention!
For more information, please visithttp://www.moeasmea.gov.tw
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• Supplements
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Financing ResourcesFinancing Resources
SMEs SMEs & &
Start-upsStart-upsCapital Capital MarketsMarkets
Private FundsPrivate Funds
Government Government AgenciesAgencies
DomesticDomestic BanksBanks
SME SME Investment Investment CompaniesCompanies
LoansLoans
RewardReward
investinvest
Invest (15%)Invest (15%) investinvest
investinvest
Incubation Incubation Fund AccountFund Account
VCVC
SME Credit SME Credit Guarantee Guarantee
FundFund
Guarantee
investinvest
SME SME Development Development
FundFund
National National Development Development
FundFund
Policy Measures for SMEsPolicy Measures for SMEs
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Information Technology Division Enhancing SMEs’ Information Technology Capabilities
a. Strengthening SMEs’ information
management capabilities
b. Promotion of knowledge management
applications
c. Strengthening SMEs’ quality
management capabilities
Policy Measures for SMEsPolicy Measures for SMEs
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Service. Minding. Esteem. Awareness
Enhancing SMEs Information Technology
Information Portal
Talent Cultivation
Communication& Network
Online Sales
e-Operation
Supply Chain Management
Knowledge Management
Micro Business Small Business Medium Business
Corporation Operation e-Network Service Project
SME e-Enablement Talent Cultivation Project
Bridging the Digital Divide of the SME Project
Industry-Specific e-Commerce Project
SME e-Business Service Project
SME Supply Chain Management Integration Project
Knowledge Management Promotion Project
(Below 5 employees) (Below 20 employees ) (Below 200 employees )
e-Infrastructure e-A
pplicatione-C
omm
erce
•The Guidance Service that’s Always By Your Side, Lifting SME e-Dream off the Ground•Provide e-Business Enabling of Independent Enterprise, Clusters, and Industries.
Diagnostic
Service
SME e-Learning Project
e-Commerce
Policy Measures for SMEsPolicy Measures for SMEs
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Financing Division Integrating the SME Financing Mechanism
a. Strengthening the functions of the One-stop Service Center b. Holding various SME Joint Services to help SMEs solve financing problems c. Encouraging the development of sound financing and accounting systems d. Promoting Credit Guarantee Fund, Joint Assistance Fund to offer SMEs various diagnosis, financing and credit guarantee e. Establishing trust investment account for start-up enterprise and incubation
Policy Measures for SMEsPolicy Measures for SMEs
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Policy Planning DivisionPolicy Planning Division Creating a Healthy Environment for the Development of SMEs
a. Advocating the fair laws for SMEs
b. Research on and analysis of SMEs’
business environment
c. Providing legal consulting services
d. Promotion of general planning affairs
Policy Measures for SMEsPolicy Measures for SMEs
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Management Consulting DivisionManagement Consulting Division Strengthening the SME Management Guidance Function
a. Strengthening management quality and promoting upgrading and transformation
b. Helping SMEs to secure business opportunities of government procurement
c. Development of industries with local characteristics d. Promotion of mutual assistance between enterprisese. Helping small enterprises to survive and develop
Policy Measures for SMEsPolicy Measures for SMEs
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Business Start-up and Incubation Division Building a Platform for Business Start-up and Incubation
a. Establishment of a mechanism for supporting
entrepreneurial activity and innovation
b. Strengthening the SME innovation and incubation
function
c. Strengthening SME manpower resource development
d. Participation in international activities and
cultivation of international SME talent
Policy Measures for SMEsPolicy Measures for SMEs
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Service. Minding. Esteem. Awareness
One Town One Product