Mission report

Kewpie Corporation Plant.This morning we visited GOKA plant of Kewpie Corporation, the first corporation of Asian trip. Kewpie provides a broad line of products from household to commercial use, and its business includes condiments and processed foods, health function products, egg products, and salads and prepared foods. Kewpie is established in Otaki-cho in 1919. Nowadays, Kewpie has 82 plants in Japan including affiliated plants, and 7 subsidiaries and affiliates worldwide. GOKA plant is established in 1972 with 276 employees. Kewpie Corporation devotes into food products and finechemical in Japan and internationally.

Spotlight & Insights

Motto & PrincipleKewpie Corporation does everything based on its motto and principle. The corporation principle includes act on moral principle, which is the most significant thing for Kewpie employees & customers; strive for originality and ingenuity, which consists of the uniqueness of Kewpie Corporation, preventing other competitors from copying. From my perspective, establishing and following the corporation principle assist Kewpie to go beyond the satisfaction of customer requirements andmaintain the position of the food giant domestically and internationally.

Aim for Upgrading Kewpie Corporation continuality aims at upgrading the efficiency in terms of three qualities: man, work, and product. Kewpie Corporation intends to make its employees to enjoy their jobs through improving itself and others job together, making easy works such as auto production and the shortening of work hours soas to improve the efficiency and productivity. In terms of the products, Kewpie Corporation devotes itself into creating products that meet the changing tastes, lifestyles of its customers, and health needs.

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Kewpie Corporation archiving great success in domestic market attributes to three reasons. First, Kewpie Corporation puts products quality as the priority rather than market price. Although Kewpie Corporation purchases their ingredient from all over the world such as vege oil from Portland, it still concentrates on domestic market out of better quality control. What`s more, Kewpie Corporation prefers to sign quality contract with trust suppliers ensuring quality control. High quality is crucial uniqueness of Kewpie Corporation to survive in competitions. Second, Kewpie Corporation devote into sustainability development such as 100% egg recycle. The third reason is innovations. Kewpie Corporation`s innovation is from the stand point of customers which is a essential uniqueness of Kewpie, thus Kewpie Corporation should keep those qualities in the future. While Kewpie Corporation global expansion is slow. From the founder`s perspective, he doesn`t like to expand the size of the company, because the quality cannot catch up with always. However, I still believe Kewpie Corporation need to devote more effort in its global markets.

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Nissan Oppama Plant.

This afternoon we visited Nissan Oppama Plant, one of Nissan’s three major vehicleManufacturing plants in Japan. Nissan Oppama Plant is establishedin 1933, and since 2010, the Nissan Oppama Plant started producing “Nissan LEAF”, the first mass-producible electric vehicle. Now, Nissan Oppama Plant only produces four types of cars based on the customer needs.


Integrate of Supplier With the aim of reduction manufacture schedule, Nissan Oppama Plant adapt douki-sisan system, which realizes time delivery to customer by means of supplier and producer produce as sequence, while the integration of supplier is crucial for douki-sisan system. Because such a supply chain integration largely improves installing efficiency, and cost reduction into each process from importing of raw materials to distributing outgoing product. In addition, the components are ready for assemble in the plant; therefore, the operators do not need to puck up by themselves. Inthis sense, Nissan Oppama Plant successfully reduces the lead time even though it manufactures products based on the customer orders.

Inventory ControlIn addition to integration of supply chain, Nissan Oppama Plant adapts build-to-order system to control its inventory as well. According to the plant tour introduction, Nissan Oppama Plant does not have products inventory since the production is one hundred percent according to customer order. As mentioned earlier, Nissan Oppama Plant only manufactures four types of Nissan LEAF car, and all processes are divided, and each operators only take responsibility of theirs own. And as mentioned earlier, the components are ready for assemble, therefore, all those make operators` work much easier. As far as I am concerned, this process is essential for Nissan Oppama Plantto realize build-to-order system so as to control its inventory.

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From my perspective, Nissan Oppama Plant`s success attributes to the combination of the idea about integration of supply chain andwell-organized working process. The application of douki-sisan system helps Nissan Oppama Plant bringing purchasing, quality, logistics, customers and suppliers all together, helping each work together more effectively. Meanwhile, the build-to-order system also helps Nissan Oppama Plant control its inventory. The two operational strategies fundamentally lead the Nissan Oppama Plant to archive the success.

In the future, I would like to recommend Nissan Oppama Plant to maintain existing advantages, and devotes into expansion international market share via innovation and localization to meet the global market customers` needs. Because Nissan`s domestic market share is still much lower compared with TOYOTA.

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RICOH Corporation.This afternoon we visited Ricoh Company, an office automation solutions provider. The product portfolio of Ricoh includes copiers, printers, fax machines, and related supplies and services. Ricoh has made customer value creation its first priority from the viewpoint of customers since its founding in 1936. Ricoh devotes to provide high quality cameras and electronic devices to its customers.


Technical InnovationRicoh devotes into creating new innovations with new imagination and idea, which is its core competitiveness. Ricoh has brought about technical innovation in office environment by introducing avariety of new products and services. In addition to following conventional procedures, Ricoh also try new approaches such as new marketing activities about developing component technologies.The company is also developing new projectors, which would enableRicoh to innovate and launch products that will meet customers' demands.

SustainabilityThe founder of Ricoh, Kiyoshi Ichimura, aims to: ‘Innovate on behalf of our customers and to pursue sustainable business practices on behalf of every life we touch’ is a sentiment that echoes throughout our business today. Ricoh takes a three “P” approach to gain sustainability: People, Planet and Profit. As far as I am concerned, this definitely helps ensure Ricoh`s business model is maintained and continuously improved tosupport business and environmental objectives.

Since Ricoh in Japan where it is a developed market, Ricoh’s strong market position gives it a competitive advantage over its peers. Ricoh may consider accelerating business structure shift to service businesses. The company holds number one position in multifunction printer market in Japan, the US and Europe. T

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While, on the other hand, Ricoh should take into account to achieve business expansion in emerging markets such as China.

Moreover, Ricoh faces competition from Canon, Kodak, Sony, Olympus, Hewlett-Packard and others, and operates in a highly competitive environment which could impact its overall margins inview of excessive bargaining from customers and competing companies for contract prices. In this sense, Ricoh need to keep focus on innovating and launching premium products that will meetcustomers' demands, which is the core competitiveness for Ricoh to survive and become the pioneer among the industry.

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HINO Corporation.

Today we visited HINO Motors. As a leading manufacturer of heavy-and medium-duty trucks and buses, HINO Motors is motor giant in Japan. It was founded in 1910, and became the alliance with Toyota Group in 1960s. HINO Motors was the first company launcheddis-electronics. With the aim of profitability, HINO decides to decrease the cost since profits generates from the increase of sale price or the decrease of cost, while price is market controlling. Except for heavy- and medium-duty trucks, HINO also offers light duty trucks in the Japanese market. The company has a large market share in Southeast Asia and Australia.

Insights

Kanban SystemHINO adapts Just in time & Automation production system. Kanban system is one of the most important ways to archive JIT. Kanban is a method for maintaining an orderly flow of material. By placing a Kanban cards, manufactures will know at which point material should be ordered, how much material is needed, from what place material should be ordered and delivered. What`s more,Kanban system can easily assist supervisors tracking the number of cards used in this system, or adjusting the usage of cards onceseasonal changes in demand. In general, Kanban system can preventMUDA of over-production.

Backups from ToyotaAs a subsidiary of the Toyota Group, Hino has access to an array of benefits such as mutually utilizing technologies and expertise. Toyota, one of the giants in global automotive industry, devotes in the development of vehicles and engines, commercial vehicles, trucks and buses, as well as genuine parts business. As far as I am concerned, the strong background of HINOfor the global trucks market provides a growth opportunity.

However, Hino has a bunch of competitors from automotive manufacturers around the world considering that the automobile market is highly competitive. From my perspective, I still

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recommend HINO try to expand its global market share in the future. The reason behind that is HINO should maximize its profitability and brand awareness. Although HINO achieved great success in domestic market, its global market share is far behindthat in Japan. In this sense, HINO might need to take advantage of Toyota to realize globalization out of long term perspective.

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Bridgestone Corporation.This afternoon we visited Bridgestone Today Museum located at Kodaira City Tokyo Technical Center. Bridgestone is a Japanese rubber & tries corporation. Bridgestone is founded in 1931. Bridgestone design, development, manufactures track & bus tries as well as aircraft tries. In addition, Bridgestone has diversified into other business including production of air springs, roofing materials, and industrial fibers and textiles.


Innovation Bridgestone devotes into the design, chemical analysis, and technology development from raw materials. In addition to traditional tries products, Bridgestone also designs and manufactures other rubber products such as Seismic Isolation Rubber which protects buildings from earthquakes.

Safety & ReliabilityBridgestone thinks from customer`s standpoint. From Bridgestone`sperspective, Bridgestone intends to learn from the actual environment its products are used. It applies tries testing so asto better meet customer`s need. Moreover, Bridgestone devotes into environmentally friendly technologies. For example, Run-FlatTries, which let you drive even with a puncture.

MarketingBridgestone started to invest in Motorsport in the 1980s by developing race tires for feeder series, and one of the reason, as the Bridgestone worker explained, it is a good way to promote the brand awareness and reputation. The Japanese company decided to supply tires for Formula One, aiming to improve Bridgestone's name value in the European market.

Bridgestone is top rubber & tries designing and manufacturing company. The uniqueness of Bridgestone is it devote into R&D to produce high performance rubber & tries products based on the customers standpoint. Meanwhile, Bridgestone devotes into

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innovation as well. All those cultivates Bridgestone to become the giant in its industry. During short visit in Bridgestone Today Museum, the most impressive observation about the strengthsis that Bridgestone`s strong R&D and new tech innovation. For example, Bridgestone, as a Japanese company, developed and designed Seismic Isolation Rubber. However, the weakness is the price. This new tech is still not widely applied among earthquakeregions.

Bridgestone has a strong brand name through Motorsport and car racing. However, the price strategy of Bridgestone`s products still targets only high price segment. From profitability standpoint, Bridgestone still needs to design and manufacturing some economy products so as to acquire more market share, particularly in some developing regions. Meanwhile, given that fierce competition in this industry, Bridgestone still has many competitors such as Michelin, Yokohama. Bridgestone has to maintain its core competency and keep implement its global growthstrategy.

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Kao Corporation.

Today we visited the last corporation in Japan, Kao. It is a Japanese corporation devotes into consumer products business, andchemical business. The consumer products business of Kao is consisted of four segments: beauty care, human health care, fabric and home care, and chemical business. Kao is founded by Mr. Tomiro Nagase in 1887. Kao operated its own plant, and was capable to handle the entire production process, from the raw material preparation to final products packing since 1902. Now, Kao`s products are over 1000 items, and are sold in 112 contours and regions all over the world.


InvestmentKao largely invests for R&D activity and marketing activity. Given that increased demand for product differentiation, Kao makes R&D as its core activity. According to the records, the expenditure of R&D activity is nearly 5%. Meanwhile, Kao prefers to take advantage of various social media to archive its marketing goal since 1900s.

Forecast & InnovationKao prefers observing consumers behaviors such as people`s washing style and different life style. Therefore, Kao does massive market research in order to innovate, since Kao care about customer experience. Meanwhile, KAO`s approach and goal is making products based on the forecast. Except for consumer needs forecast, Kao make forecast on future supply & demand as well such as environment issue, population.

Global Expansion Global growth of Kao largely relies on distributor instead of direct sale. Consumer products business is operating in 99 countries, but 77 of them are through distributors, and only 28 of them are by means of direct sale. That`s the reason why Kao has many plant around the world but the it main market is still at domestic.

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As the Vice President mentioned at the presentation, the primary issue of global expansion Kao facing is marketing expenditure. Considering Kao is the top brand in domestic market, it take tremendous time and money to establish its brand image. in addition, sale force is a big issue for Kao`s global growth.

Kao is the top human& home care and chemical business company in Japan, and it has made tremendous achievement during the past 120years. The uniqueness for Kao is its capacity to consciously produce high quality and customer-oriented products in terms to satisfy customers` current needs and help its customer finding their potential needs. Although Kao is the giant in domestic market and it starts to make global growth, Kao has facing certain big issues such as global expansion and it is still working on solution. In addition, from my perspective, the market share and competition is the biggest obstacle for Kao`s expansion, because products from this industry have a rapid life circle. In this sense, I would expect Kao to maintain its core competency and keep workingon global growth in terms of profitability and sustainability.

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Caterpillar Corporation.Today we visited Caterpillar Corporation, one of the largest manufacturers of construction and heavy equipment, engines, and industrial gas turbines. Caterpillar came into China and increased investment and business development activities in 1996. Caterpillar Corporation made great success in China as it did in global market. Caterpillar develops a diverse brand portfolio and its own distributions system.


Business Model & ValueCaterpillar Corporation tries to develop close partnership with the dealers, and Caterpillar prefers to sign long-term contract with dealers. The business model of Caterpillar Corporation offers valued, quality, products, services and solutions to our customers who provide the lowest total owning and operating lifecycle costs. Meanwhile, Caterpillar Corporation establishes the value in action through the power of honesty, the power of quality, the power of teamwork and the power of responsibility. From my perspective, Caterpillar business model and value are fundamentally assists Caterpillar to archive Chinese market.

Recipe for Success in China

Caterpillar Corporation in China did a lot of localizations and develops particular products strategy. At the same time, Caterpillar Corporation devotes into tech transferring, and training the local suppliers. What`s more, Caterpillar Corporation cultivates the local leaders so as to get close to the culture to benefit the business. As the HR manager indicatedthat the customer bases of Caterpillar Corporation in China primarily consist of A Class customers who carry on state-own projects. The local facility has the same standard for work as the US, and even better. Meanwhile, higher construction and mining activity in the emerging markets provides a very good environment for Caterpillar Corporation doing its business.

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As far as I am concerns, Caterpillar Corporation creates a strong portfolio of products to meet every application. Moreover, Caterpillar Corporation in China does have good relationship with its class A dealers, and has the opportunitiesto participate in state-own projects. In this sense, CaterpillarCorporation made great success in China considering that Caterpillar Corporation maintains sustainable and reliable relationship with the government, which is crucial to do the business in Chinese market.

Caterpillar Corporation is definitely the giant in heavy equipment industry, and there is no strong opponent in Chinese market, however, there is a potential threat for Caterpillar Corporation in China as well. For example, stiff competition from Joy Global, which is starting upgrading and setting up new capacities in China. Besides, given that mining operations dependent upon material prices and political stability, businessin Chinese market largely rely on the maintain of relationship between Caterpillar Corporation and Chinese government, while, this is hard to control in some degree.

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LG Electronics.This afternoon we visited LG Electronics located at Shanghai. LGElectronics, a Korean corporation, operates worldwide through more than 30 companies in the electronics, chemical, and telecomfields. LG Electronics business area includes home entertainment, mobile communications, home appliance, and air conditioning energy solution. In addition, LG Electronics devotes into new growth engine such as automobile solution, living eco solution, energy solutions, healthcare solution. However, LG Electronics in China is not as success as it in other countries.


ChallengeLG Electronics, as a giant of this industry, faces to fierce competition in Chinese market. First, local companies are much more speed in growth instead of their performance, and barely want to become the top one in the market. On contrast, foreign companies intend to do the different things. Foreign companies like LG Electronics devote to show the value of the company and its brand. Second, the overhead cost of the company, compared tolocal companies, is much higher. Local competition in terms of price, LG Electronics provides high salary for administrators and good condition working environment, attributing to difficulty reduce the price of its products. In addition, there are many other challenges LG Electronics has to deal with such as exchange rate and tax. In this sense, the environment in China easily make LG Electronics’ profit margin low.

Strategy in China LG Electronics devotes to retain good talents by means of letting them feel the growth opportunities. What's more, LG Electronics prefers working with top university, and foreseeing the government steps so as to archive its goal in Chinese market. Meanwhile, one of the most crucial recipes for LG Electronics run its business smoothly, as the LG Electronics in China manager mentioned during the Q&A section, is that top CEO

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takes good advantage of his own good personal relationship in doing the business, particularly in Chinese market. From my perspective, all those strategies play significant roles when LGElectronics does its business in China.

Although LG Electronics devotes into research and development for Chinese market through establishing a R&D center in China, continually getting feedback of R&D from local market, and developing vertically internal produce so as to reduce each other produce cost, talent, labor cost, now LG only focus on thelow risk research technically, because as competency may increase, may develop to high risk. From my perspective, the main issue for LG Electronics in China faced today is that the value and the margins are difficult to balance. In this sense, Iwould recommend LG Electronics to rebuild its positioning in China so as to catch the customers.

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Shanghai GM.Today we visited Shanghai General Motors. Shanghai GM is the Chinese biggest sinuous joint venture which was established in 1997. Shanghai GM sets up a joint-venture with Shanghai Automobile Industry Group Corporation (SAIC), one of China’s largest and government-owned automotive firms. Shanghai GM builtChina’s most advanced car factory in Shanghai’s Pudong region. Shanghai GM currently produces Buick, Chevrolet, and Cadillac series cars, engine and transmission. Main product lines includeBuick, Official station wagon, and SaiOu SRV recreational cars. Currently, the company faced tough competition from Toyota, Volkswagen and Honda.


Consumption Pattern The consumption pattern of Chinese consumers have been obvious is improved since last three decades. Given that China is still under the economic transition driving the growth of national economy, the quality of life of Chinese consumers is largely improving. Although the income distribution was extremely unbalanced where citizens live in coastal cities earning much more than those in the inland, the quality of life and their consumption pattern of Chinese consumers have been obvious is improved. Today, most Chinese consumers would like to spend moreon home entertainment, travelling, education, and clothing. What`s more, families are considering to spend money on cars. The improved consumption pattern and demand for automobile is a good opportunities for GM to grow in Chinese market.

Inventory ManagementShanghai GM has no inventory storage by collecting for its management system. The material plan will be made and the car isbeing produced, therefore, the process is totally done accordingto the order. Under such kind of process, the customers can check about their cars` production progress and make change based on the process. On the other side, Shanghai GM will be able to know who will place the order for the car once the car

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is on the producing line so that the car can be shipped out after it is finished.

China, the world's single largest auto market, now has become GM's largest market. Shanghai GM should devote into sustainable development in Chinese market. Nowadays, Shanghai GM is already start design and manufacture a lead in battery development and electric vehicles. Meanwhile, as the executive mentioned during the Q&A, Shanghai GM`s achievement can be attributed to the top executives` personal relationship. From my perspective, maintainthe networking particularly with the government is significant for doing business in China, Shanghai GM need to consider in advance about the instability in such a relationship. The reasonbehind that is there are a variety of competitors among automobile markets, and all of them are try to maintain the goodrelationship with the government. For a long-term perspective, Iwould recommend Shanghai GM perceive the dynamic market so as tocontinuously to be the pioneer in this fierce competition.

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APCO Worldwide.This afternoon we visited APCO Worldwide in Shanghai, an independent communications consultancy by providing integrated services across multiple industries to get into their target market. China is an investment priority for multinational corporations, and since 1989 APCO Worldwide has been serving clients' interests in China including government relations, strategic communication, corporate responsibility and corporate advisory.


Political PolicyAPCO, unlike most public relations firms which focus on corporate communications, has been hired to handle sensitive political issues, meanwhile, to forecast the changes and significance of the political policies. From my perspective, it should be core competitiveness for APCO Worldwide in China sinceChina is under a political economy transition, the business environment in China is a complex, and foreign investors do havebarrier to get into this heavily regulated market where it welcomes foreign investment. APCO is devotes to work on how to enter china market how to work with government policy? That`s the reason why many executives from the APCO Worldwide`s team inChina were previously prominent government officials. Moreover, the team in China also includes professionals from business, media, and academia. In this sense, the business strategy of APCO Worldwide in China fits in exactly with the environment.

Media Tools TransitionAPCO Worldwide helps clients position themselves strategically in China by building communication platforms through various tools such as social media. The reason for widely use social media is particular situation where China is still under a political economy transition. As it well known, China is single-party state which is highly regulated by government. Government has the capacity to take control of traditional media

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out of its own purposes. The emerge of SoCal media, however, hasfundamentally change the game. Given that the increase of popularity of the social media among Chinese recently, nowadays,if you don't have social media it is hard to start the communication. APCO Worldwide noticed the opportunities for its clients and take advantage to assist its client corporations to break the ice and establish new image to Chinese market.

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Nike Vietnam.This morning we visited Nike Vietnam. Nike Vietnam has experienced and stable factory base and lean manufacturing innovation. Nike began manufacturing in Vietnam in 1995, and over 130,000 Vietnamese citizens are employed by factories manufacturing Nike-branded products. Considering that Vietnam isa developing country which welcome to foreign investment, Nike Vietnam does maintain a good relationship with the local government. In addition, Nike Vietnam devotes into the modernization, that it’s the reason why Nike chooses this offshore factory model. Nike Vietnam also succession planning for leadership teams by means of cultivating the local engineering and talent, hiring and training local Vietnamese.


CHing Luh FactoryChing Luh plant is one of 10 factories that contract with Nike to produce sneakers in Vietnam.By providing innovative allusion for product and process, Ching Luh plant aim to be the leader of shoe industry, and regards thequality and craftsmanship at the heart of what we do with products and process. Ching Luh plant is a Taiwanese owned company established in 1969. It has many plants in Asian district such as Fuzhou China, while subordinations in Taiwan and Hong Kong are the only cities in charge of Material consolidation. Nowadays, Ching Luh plant has 23,000 employees and 82% of them are residents of local area Long An Province.

Design CooperationChing Luh plant offers competitive solution in all source locations. From my perspective, innovative allusion for product and process provided by Ching Luh plant is the core competitiveness of this plant. It helps to maintain a sustainable relationship with Nike Corporation by means of participate the products innovation and customer orientated

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information support. At the same time, Ching Luh plant partners with other universes and other companies to work with so as to raise awareness of needs as well.

What` more, Ching Luh plant devotes to collaborate and advocate with the Business community the consensus around infrastructure development. One of the responsibilities of Ching Luh plant is to keep communication with workers as well as to keep them satisfaction. Work proactively to engage the workforce and the community to achieve its goal.

Although Ching Luh plant devotes into improving the communication with workers and satisfaction, poor related communication and labor volatility are still the potential issues of Ching Luh plant. Related communication is important toChing Luh plant, however, Ching Luh plant still has problem about clear communication with manufacturing. I would like to suggest Ching Luh plant devoting more to training the local leaders since local Vietnamese definitely understand local cultural diversity better than anyone else. For instance, Ching Luh plant can encourage employees to involve in discussing the transition so that they have opportunities to provide ideas and feel motivated to perform well, which would have resulted in employer satisfactions and motivation.

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Mercedes Benz

Today we visited Mercedes Benz Corporation located in Go Vap District, Ho Chi Minh City. This manufacture factory includes training center, which carriesout sales, marketing and technical training courses to ensure a high level of employee competence. As the factory manager said, Mercedes Benz Vietnam ranks as 44 of top hundred places to work in Vietnam. The intention of Mercedes-Benz Vietnam is to be the most successful car producer in combination with highly efficient customer oriented support.


Manufacture StandardsAlthough Mercedes Benz Vietnam manufacture factor has no research and development center, it has the capacity to produce high standard vehicles for local consumers without operating difficulties. Mercedes Benz Vietnam has shared the latest technology with Mercedes Benz in Germany, and has automobile testing center to test the vehicles quality and assure Mercedes Benz worldwide standards are applied. Engines and many other parts are directly imported from the Mercedes-Benz companies andthen assembled or manufactured in Vietnam. At the same time, Mercedes Benz Vietnam the affiliated Mercedes-Benz company’s implements high-tech quality control cyber system so as to realize real-time monitoring.

Emerging MarketVietnam autos industry is still under growth status, the low rate of vehicle ownership provides more opportunity for sales growth in Vietnam. Meanwhile, Mercedes Benz, as a representativeof high-end vehicle, has potential market in Vietnam because theeconomic boom has lifted many Vietnamese out of poverty, and it shows diversity, with growth in both the premium and low-emission car segments. However, fluctuations in import tariffs bring instability to Auto market as well. The increased special consumption tax at local market definitely puts pressure on domestic vehicles manufacturers.

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From my perspective, Mercedes-Benz Vietnam as one of the top auto makers has great potentials in Vietnam. However, it should take a long time to archive the profitability. Meanwhile, the infrastructure is still weak in Vietnam. Although Vietnam seems to be a good base for international trade in reasoning that Vietnam's geographic advantage as well as a large quantity of skilled and low-cost workforce, roads, railways and the ports are unable to cope with the country's economic growth. All in all, Vietnam is increasingly attracting investment from key economic giants such as the United States, Japan, and some European countries to transfer their plant and subsidiaries. This must offer the possibility of the transfer of high-tech skills and benefit demotic industries and tech innovation.

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HSBC.This morning we took a course lecture about Hong Kong and Shanghai Banking Corporation (HSBC) in Vietnam at our hotel. HSBC rst opened its of ce in Saigon dated back to earlier 1870,fi fiand opened a full service branch in Ho Chi Minh until 1995. HSBCBank system in Vietnam consists of four parts: commercial banking, retail banking and wrath management, global private banking, and global banking and markets. HSBC is now the largestforeign bank in Vietnam in terms of investment capital, network,and customer base. Based on the lecture, the only reason for HSBC Bank to choose Vietnam lies in the expectation of Vietnam to growth as well as increased investment. Actually, most banks in Vietnam are controlled by state, and HSBC Bank is the first foreign bank to entry Vietnam, and became one of the rst whollyfiforeign-owned banks to locals in 2009.


Potentials As a member of the World Trading Organization, Vietnam has made great efforts to improve its business and investment environmentfor foreign investors. As the report indicated, the GDP growth is consistently over 5%, and the export has growth from USD 72billion in 2010 to USD 134 billion in 2013. Moreover, the trade balance reasonable and on an improving trend. Foreign reserve grew 200% over a two year period and VND was stable against the USD. Now, not only foreign investors and multinationals all over the world are looking to do business in Vietnam, but also a growing number of Vietnamese companies are looking to trade internationally. In this sense, HSBC takes a great opportunity to assist the business growth in Vietnam by means of establishing profitable corporations.

Local CommitmentGiven that it is the first foreign bank to entry Vietnam as early as 1870, HSBC seems gain unique position to assist its

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clients seek for opportunities in Vietnam. HSBC Bank aims to assist both foreign investors and domestic corporations by providing an insight about key aspects of undertaking business and investing in Vietnam.

With one-party system and market-oriented reforms, Vietnam is conducive to political stability in a short run. This will definitely benefits for foreign banks such as HSBC, however, government policy and relationship play a significant roles among foreign banks locally. Meanwhile, State-owned enterprises will continue to be a drag on economy growth. HSBC Bank with theaim to become the local bank world widely should be concerned about the dynamic policies and maintain the relationship with the local government.

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Starbucks Vietnam.This morning we took a course lecture about Starbucks in Vietnamat our hotel. Starbucks started bring its culture to Vietnam by opening of its first store in southern Ho Chi Minh City in 2013.Unlike elsewhere in Asia, Vietnam has an existing coffee culturedated back to a tough market for Starbucks than anywhere else inAsia. While, based on my observation during the six-day visit, every Starbucks I went are fulfilled with people, and it was hard to find seat in store. Right now, there are


Unique ExperienceAs mentioned before, Vietnam has an existing coffee culture and there is various local coffee brands prevailed among local market. However, the Starbucks is selling more than just coffee as the director said. Starbucks is devoting to create and design a store to make a much different position to anyone in Vietnam currently coffee brands. For example, some early customers at the new Ho Chi Minh City store said they were more interested in sampling the ambience of the store than the taste of Starbucks' coffees.

LocalizationsThe coffee drinks seem to be available nearly anywhere in Vietnam. Starbucks yield potentially greater returns on innovations by put emphasis on localization marketing to satisfytheir customers` needs in turns gain greater market. For example, Starbucks adjust the recipes of making espresso coffee beverage considering the Vietnamese`s preference. Starbucks provides periodically put forwards new drinks or seasonal drinksin international markets, based on customers` feedbacks and market research. Starbucks generates new knowledge leading to innovation.

Considering it is a brand new coffee brand for Vietnamese, Starbucks still need more time to win the customers confidence in this fierce market. However, based on my observation, young

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people are more interested in trying this new brand compared with the senior generations. In this sense, Starbucks could try to target young generation for a short-run, which could help Starbucks to establish its brand awareness at local market. In addition, in order to complete with the historical local coffee brands, Starbucks need to devote more efforts to understand the local coffee cultures, and to improve the current beverage quality and tasty, because Vietnam seems to be a challenge for Starbucks to achieve its customer loyalty, particularly those whom stick with the traditional Vietnamese coffee.

Besides the domestic players, numerous foreign coffee retailers are already at play in Vietnam such as The Coffee Bean & Tea Leaf and Gloria Jean’s. What`s more, unlike other Asian markets,Starbucks can often found itself introducing the concept of drinking coffee to consumers who traditionally share the tea culture such as in China. Now Vietnam presents a different as Vietnam is going to have a fight for its consumers far more complex by both local and foreign players.

Microsoft

This afternoon we visited Microsoft Corporations “new digital work style” workspace at Ho Chi Minh branch office. Vietnam. Microsoft Vietnam intends to develop a long-term, trustful relationship with the local enterprises and government by means of tech supports. The strategy of Microsoft at Vietnam aims to create a familiar of devices and service for individuals and business that empower people around the globe at home and work.


Support Local BusinessIn Vietnam, Microsoft devotes into helping local enterprises andindustries realizing their potentials and improving their marketcompetitiveness with information and communication technology supports. For example, Microsoft Vietnam plans to collaborate

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with the Vietnam Chamber of Commerce and Industry to assist the local small and medium enterprises including young enterprises in rural area with e-commerce applications. In addition, Microsoft Vietnam intends to encourage the local Vietnamese to work for its company by opening internship to local students, summer tour to Microsoft tech center for high school student as well as a variety of employee training programs.

Partner to GovernmentSince 2014, Microsoft is partnering with Vietnam’s Ministry of Information and Communication to improve national cybersecurity.As the executive mentioned during the company visits, Microsoft Vietnam tried to provide software products at adjusted price forgovernment utilization. Although the pirate runs wild in Vietnam, Microsoft Vietnam regards it as a part of Vietnamese culture. Based on what the executive said, people prefer to buy the pirate no matter the price. This phenomena seems hard to change barely relies on the government regulation. Form Microsoft Vietnam stand point, it would like the people being willing to use their products out of superior user experience itenable to provide. In addition, Microsoft Vietnam also helps to develop local skills around cloud computing, app development andinfrastructure management so that optimizes the user experience.

From my perspective, Microsoft Vietnam has strong outlook in this country in reasoning that the both the local enterprises and people are like this brand and its products. Although the pirate is still the toughest issue for Microsoft Vietnam and seems hard to make tactical progress in a short term, Microsoft Vietnam did win high reputation locally. I would like to recommend Microsoft Vietnam to keep working on cultivating the local leaders and assisting to develop local business.

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Phillips.Today we visited our last company of the Asian trip, Phillips Lighting Vietnam. Phillips Lighting in Vietnam focuses on three parts, Healthcare, lighting and consumer life style. The major target markets are still in growth geographies areas such as ASEAN Pacific, Japan, India, Pakistan, and South Africa. Phillips Lighting in Vietnam focuses on organizing around the people we serve: home, offices, outdoor, industry, retail, hospitality, entertainment, healthcare and automobile. Philips in Vietnam diversified products in small quantity, and factory organizational structure includes: sales, marketing, technical, lighting, design, turnkey, projected and services, department, supply china, and finance. Now Phillips is no. 2 spontaneously recalling the brands.


LED RevolutionPhillips Vietnam devotes into manufacturing the best LED and started a LED revolution: the conventional light accounted for 78% and the LED Light is 22% in 2012, while the percentage of conventional light should decline to 55% and the LED light should increase to 45% in 2015, based on the forecast of Phillips Vietnam. In fact, Phillips Vietnam did put R&D investment as priority. Moreover, Phillips gained many opportunities to participate in state-owned projects such as LEDlighting solutions for Ba Na hills TP&S project.

Solution & Services

Another significant achievement is that Phillips Vietnam tries to win in the consult market. Phillips Vietnam tries to develop integrated solution for the professional market by providing Solutions and services including software, controls, Luminaries and light sources and modulespackaged LEDs. For example, the Empire State Building applied dynamic lighting which enables to reflect 16 million colors. What`s more, the dragon bridge Da Nang project, regarding as one

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of the famous project in the world. Phillips Vietnam started from the design of dragon bridge Da Nang, and it helped to successfully attract 3.1 million tourists yearly.

As far as I am concerned, the key factor for Phillips Vietnam attributed to its capacity of innovations. It is also the competitive advantage of Phillips Vietnam since it can show the success stories that Phillips Vietnam can bring this innovation,and also show the management team. As Phillips Vietnam factory manager pointed out, Phillips Vietnam has a close relationship with local agents, whom are constituently work with local government. I would like to recommend Phillips Vietnam to diversify its product lines and expand its market scale locally.Because right now, Phillips in Vietnam can only be found in supermarket but it doesn't mean Phillips does not want to make money. Phillips decides to do so because the customers are thereand the local competitors are there as well. So I would expect Phillips Vietnam to expand its business scale in market out of profitability stand point.

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Cultural Logs.As a member of the World Trading Organisation ('WTO'), Vietnam must continue to improve its business and investment environment and bolster its legal system to meet WTO's requirements. Vietnam has made significant efforts to ensure that foreign investors are not disadvantaged compared to their local counterparts.

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Mission report

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