Case studies

The subject area is international business and strategy. The case allows scope for the following areas: internationalisation, market strategy, emerging market multinational companies, and doing business in Africa.

The primary target audience for this teaching case is postgraduate business students such as Master of Business Administration (MBA), or postgraduate management programmes. The case is primarily designed for use in courses that cover strategy or international business.

This case centres on the international growth strategy of FMBcapital Holdings Group (FMB), the Malawian commercial banking firm. The case finds the founder and current group chairman, Hitesh Anadkat, in 2016, as he and the FMB board are about to decide on the next move in their Southern African strategy. Since opening the first FMB branch in Malawi and becoming the country's first commercial banker in 1995, Anadkat and his team have ridden a wave of financial deregulation across the region to successfully expand into neighbouring Botswana, Zambia, and Mozambique. Now, an opportunity to gain a foothold in Zimbabwe means the leaders must decide (1) whether they want to continue to grow the FMB footprint across the region, or focus on their integration and expansion efforts within existing markets; and (2) how they will realise this strategy.

International expansion – identifying the need to expand into new markets; identifying the combination of internal strengths and external conditions that make international expansion viable; and identifying and analysing each possible new market(s) and the decision-making process involved.

Political, social and economic factors in Africa – understanding how these external institutional factors present constraints, risks and opportunities for internationalisation and hence shape strategy; understanding that these factors may vary significantly across countries on the continent (in spite of their geographic proximity) and in some cases, within a single country; and understanding that by selecting markets with extreme socially and politically volatile contexts, the risk of a worst-case scenario transpiring (in which institutional forces trump business strategy) is appreciable.

Combination of resource- and institutional-based approaches – recognising that successful internationalisation requires capitalising upon both internal resources and institutional mastery.

Choosing expansion strategies – assessing the type of new market entry (e.g. greenfield or acquisition of existing operations) and its adequacy for penetrating a new market.

Using networks and local partners – to substitute and enhance the benefits that originally flow from a small (and sometime family-established) business, with an emphasis on acquisition of skills and networks in foreign countries.

Regional integration – optimising business operations through a sharing or pooling of resources and improved capital flow between subsidiaries, in some instances by taking advantage of economies of scale (this extends to enhancing the reputation and awareness of a brand across a wider region).

Family businesses – identifying the value that can be gained through establishing a family business with the support of many “close” stakeholders while also noting the limitation that exist as expansion and growth is required.

Provincial Industries has decided that the time has come to expand internationally. In this case and the activities along with it, individuals will need to consider different attributes or factors in each category evaluated. These categories include: business climate, communications, financial services, health services and “Quality of Life”, infrastructure, and transportation. This evaluation will decide the new international office location.

Steel Corp has a large production capacity but a shrinking steel market in Europe. Reaching growing markets like China and U.A.E will be important to sustaining and growing revenue but is tough due to higher transportation costs. In this case, users must identify and use logistics data; logistics customer segmentation and related cost analysis.

The COO for Suape Container Terminal, the largest deep–water port in Brazil's Northeast must consider a proposal presented by the users' council that calls for the establishment of a reservation scheme that minimizes the risk of docking delays. Under this proposal, ocean carriers, on the one hand, agree to pay a reservation fee that significantly increases revenue for Tecon Suape. On the other hand, they expect Tecon Suape to compensate them financially when a berth is not available upon vessel arrival. Tecon Suape's management team must evaluate that suggestion, as the team prepares to enter contractual negotiations with the users.