Question

business opportunities in neighboring Georgia, Armenia, Iran, Iraq, and Syria. Yet Ericsson, the Swedish telecommunications manufacturer with the largest market share in the network equipment business worldwide, had a budget of $2 billion for all its vendor financing deals together, and Motorola shelled out this amount for one deal only. Motorola made a fundamental negotiation mistake in addition to several strategic mistakes in this investment. What were these mistakes?

Answer 1

Answer:

Through reading the article,it is obvious that Motorola was exposed to a very different market. This market has a culture to that of the Middle East and the most dominant business families were of Italian decent.Therefore, Motorola should have researched more into the Middle Eastern way of conducting business and the culture.I believe that Motorola invested way too much and jumped on the mere fact that there could be a promising opportunity for them in Turkey. Not only an opportunity would open up in them in Turkey,but they also were eager for the vast breach of the market in that region. If Motorola had done the needed research for such a deal, they would have a voided that. In any cross border business negotiations,its crucial that the company has to understand the local laws of the country they are conducting business in. As we have seen many companies suffering in Cuba and other unstable countries where corruption is present.As for the strategic mistake, they could have done as after deal as i have learned in International Business; the best market penetration strategy in foreign countries is usually joint ventures or strategic alliances.So Motorola could have taken an alternate path that would have been a safer resort for them to achieve what is in their best interest and help them reach their goal.