Nora Sakari Essay

1 . Nora- Sakari: A Proposed JV in Malaysia (Revised)

The case presents the angle of a Malaysian company, Nora Bhd, which was in the process of trying to set up a telecommunications joint venture with a Finnish firm, Sakari Oy. Telecom Malaysia Bhd (TMB), the national phone system company, was given authority by Malaysian government to develop the country's telecom infrastructure. In October 2002, TBM called for tenders to bid on a five-year task worth RM2 billion for installing digital switching exchanges in various regions. The task also entails replacing analog circuit fuses with digital switches. Nora Bhd was the one of the leading corporations in the phone system industry in Malaysia. In that case Nora was interested in securing a discuss of the RM 2 billion contract from TMB and even more importantly, in getting the knowledge in switching technology from its relationship with a telecommunications multi- countrywide corporations. Throughout the initial stages, Nora deemed Sakari being a serious potential partner since Sakari was prepared to exercise customized goods according to Nora's requires. Sakari was Finland's most significant publicly-traded industrial company and derived virtually all its total sales by exports and overseas functions. One of Sakari's strategies was going to form Joint Ventures to enter new foreign markets. Nora and Sakari has mentioned the potential of building JV business in Malaysia for more than 2 yrs. In January 2003, Nora submitted their bid intended for TMB's RM2 billion deal to supply digital switching exchanges supporting four million telephone lines. Presuming the Nora-Sakari JV would materialize, Nora based the bid on delivering Sakari's digital switching technology and Nora placed a competitive bid for the TMB task and was at dire need of a partner to fulfill its contract. 2 . A. Why have the negotiations so far failed to result in a? Is the development of the JOINT VENTURE between Nora and Sakari the best option for both firms to achieve all their respective objectives? A joint venture between Sakari and Nora would be the smartest choice for both of the firms is difficult to assess. Nevertheless , there are certain rewards, which are pointed out in the case, that clearly summarize the initial inspiration for developing the joint venture. From the Sakari side, the motivation came in the form of any new marketplace in Asia-Pacific region and that the JV business in Malaysia was seen as a hub to enter this market, while Nora was motivated by Sakari's technology and the probability of acquiring this in the future. The forming of the joint venture could benefit equally companies in case the terms of the agreement were advantageous for each. It is also known in the case that Sakari acquired another option of expanding it is operations in the United Kingdom, that could be used being a hub to penetrate the European Union (EU) marketplace in turn break up the corporation into two " camps” – one pertaining to the partnership with Nora and one for started to be bidding recently-announced tender for any major telecom contract in the uk. With the stage set, we have now turn to analyzing the negotiations that Sakari and Nora held and why those two companies could not find prevalent ground to create a joint venture. Any repercussion of these was observed in the case that while Nora's executive had the ability to make contractual decisions at that moment, while Nora could agree with certain things after asking Zainal, the Sakari team, representing a big private organization, had to direct contentious items to the company panel before it could possibly make virtually any decision that went further than the limits approved by the board. The next aspect that the corporations differed in was the uncertainness avoidance. While in this aspect the two sides differed least, Nora was more inclined to take dangers involved with the creation with the joint venture. These were responsible for the establishment in the factory and managerial office buildings, while settling contracts with TMB and keeping the...