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Pharmaceutical Industry in Swiss and China

by Shamsul

Pharmaceutical Industry | An Analysis of Innovation, Creativity, and Enterprise in Swiss and China

Pharmaceutical Industry in Swiss and China

Contents

1. Introduction.

2. Industry Analysis.

2.1 Switzerland.

2.2 China.

3. Innovation, Creativity, and Enterprise.

3.1 ICT in the Pharmaceutical Industry.

3.1.1 Principles and Processes of Innovation and Creativity in the Swiss and Chinese Pharma Industry

3.1.2 Enterprise in the Swiss and Chinese Pharma Industry.

4. Conclusion.

References.

Introduction:

The report’s objective is to analyze the different aspects of innovation, creativity, and enterprise in the pharmaceutical industry specific to Switzerland and China. The details taken into account in the report span from 1990 to 2012, and data pertaining to this period is in the report.

The present situation of the industry in both countries is taken into view, along with a discussion of the economic positions these industries hold in the global market. An analysis of how and what brought them to their present positions and what is to facilitate the industry in today’s competitive world.

The report follows initially with a brief analysis of the industry in both countries, followed by the principles and processes of ICT that have been or are being planned to be incorporated into the industry and the models of innovation the two countries are presently following specific to the pharmaceutical industry.

2. Industry Analysis

2.1 Switzerland

The Swiss pharmaceutical industry is among the world’s top pharmaceutical industries, contributing to a total of 5% of the global share, ranking as the eighth largest chemical and pharmaceutical exporter worldwide. The industry contributes 48% of the total exports, with 2011 figures touching 71 billion CHF (Science Industries, 2012).

           

Novartis and Haffman-La-Roche are the two large pharmaceutical groups operating from Switzerland; however, the increased dedication towards innovation and research in the Swiss local industry has proved to be a heaven for pharmaceutical companies as besides its home companies, 41 other life sciences companies have also chosen Switzerland as their international headquarter. In contrast, 29 others operate using the land as a regional headquarters (Site Selection for Life Sciences Companies, 2013).

Switzerland is among the six countries that collectively spend 92% of the entire R&D expenditure globally (Zeller, 2004).

According to 2012 sales figures, Swiss pharmaceutical company Novartis stood at the second position in terms of highest sales in the year with the second largest R&D budget at US $9.33 billion, whereas another Swiss company, Roche, according to annual sales, rested at the eighth position; however, the company spends the largest amount on R&D compared to any other country in the world amounting to US $ 10.44 billion (Current Partnering, 2013).

2.2 China

China, being the largest populated country contributing to 20% of the global population, has a pharmaceutical 9ndustry that contributes only 1.5% of the worldwide drug market share. In its 12th healthcare reform in 2011, China dedicated RMB850 billion towards developing its healthcare system (Deloitte, 2011). China has been concentrating on its pharmaceutical industry structure and has experienced an average growth rate of 16.72% in the last few decades; however, the level of operation is still on a small scale. One major hindrance besides other factors in the rapid development of the industry is outdated manufacturing technology, as the sector still needs more innovation and investments in R&D.. Presently, 3,000 pharmaceutical products are being manufactured in China out of 90% are foreign product copies. Only a handful of 5,000 R&D Chinese institutions can compete internationally.

3. Innovation, Creativity, and Enterprise

Innovation, Creativity, and Enterprise (ICT) is the general technology that emerged in the late 80s and gained momentum in the early 90s. ICT refers to the convergence of communication technologies and information technology, termed as ICT. The basic idea behind the ICT concept is to save costs and create value-adding innovations. ICT advances have thus contributed to different industries by reducing the costs of gathering data and storing, processing, retrieving, analyzing, and transmitting all information(Productivity Commission, 2004).

Thus, ICT has also contributed a lot to the pharmaceutical industry worldwide, and we will discuss examples pertaining to the selected countries in this report.

3.1 ICT in the Pharmaceutical Industry

Countries worldwide, especially in Europe, Western World, and some Asian countries in the past few decades, have increasingly invested in R&D, and the ratio of GDP investment is increasing yearly. ICT has increasingly helped the pharmaceutical industry introduce innovation in processes, the structure of organizations, and the end product itself. These improved processes add value to products, improving the quality, convenience, and timeliness for customers or end users, reducing waste and coordination costs, and facilitating specialization and outsourcing. ICT thus offers more effective and efficient output generation from capital and labor inputs (Productivity Commission, 2004).

3.1.1 Principles and Processes of Innovation and Creativity in the Swiss and Chinese Pharma Industry

Innovation goes a long way in the pharmaceutical industry of Switzerland. Especially since pharmaceutical companies hold patents for any new drug or medicine introduced, prohibiting others from producing the same drug using the same process; however, there is room to constitute the same drug using a different approach, method, component, or material. For this, extensive levels of innovation are patenting leaves room for an innovator who can develop the same drug or a new one by introducing a new technique.

As much as pharmaceutical companies need innovation to bag a larger market share, pharmaceutical innovation often results in costly products, which is added on by the further cost marketing of new pharmaceutical products, making the end products for the user financially heavy. Also, due to the patent law in many top pharmaceutical market share holder countries, consumers residing in poor countries are often hurt as these medicines do not reach them (Boldrin & Levine, n.a).

In China’s case, the country lacks the kind of investment needed for R&D, especially in the pharmaceutical industry. Even though the rising global share of Chinese pharmaceutical sales were almost 97% of the chemical products until 2007. It includues pharmaceuticals were generic and roughly only two drugs were domestically developed (Huang, 2013). The government plans to invest mainly in the R&D sector, evident from the figures that state China was the second highest R&D investor in the world in 2011 from number 9 in 2007 (China Bio, 2012).

Many factors are playing their role in promoting innovation in the Chinese pharmaceutical industry today, as the government’s pressure to lower the prices of generic drugs forces domestic producers to shift towards innovative high-priced medicines. To introduce such high-value pharmaceutical products and reduce the process’s development risks, China is planning to look towards the proven in-license technology used in the West. This trend will also motivate and lure international MNCs to invest in the Chinese market. International collaborations and cross-border strategic alliance activity further pave the way for introducing innovative drugs. Novartis, a leading Swiss-based pharmaceutical company, is opening its R&D center in Shanghai, which will further facilitate the innovation process in the industry for both countries. (China Bio, 2012).

Both the Swiss and Chinese pharmaceutical industries are aligned with high potential, with the Swiss industry already enjoying a top position in the global pharmaceutical market while the Chinese industry is rapidly gaining on the way.

3.1.2 Enterprise in the Swiss and Chinese Pharma Industry

The Chinese pharmaceutical market had about 3,500 companies in 2011, compared to 5,000 in 2004. Even though China is a fast-growing pharmaceutical consumption market, the number of local companies is in decline, mainly due to the rising competition. China has been following the imitating innovation method to date to compete with the highly developed and financed industry of the West; however, presently, the government has dedicated itself towards more rapid and accurate innovation processes and is now incorporating cooperative innovation processes, bringing in use the previous researches and methods used in the West and investing in new techniques both in the scientific research area and in academics as well.

The Swiss industry, however, is very much developed, even in the field of R&D, and follows the self-innovation process, adding creativity to the previous cycle and adding more value. The Swiss industry innovates and does not depend on new technology to formulate; instead, it introduces new technologies (Chu & Han, 2008).

4. Conclusion

The pharmaceutical industry in both countries is at different points regarding ICT. The Swiss industry with the world’s top pharmaceutical companies operating from the government and dedicating one of the most significant R&D expenditures in the field. In contrast, China is increasingly investing in R&D and biosciences as well. However, the local pharma industry in the country has yet to sustain the overall industry growth.

The Swiss pharmaceutical industry is innovative. Presently, its companies are considered the big players in the global market. They are increasingly working towards maintaining this high share and exploring new opportunities for growth. China is way behind compared to Switzerland. However, it is a growing industry as China has the most prominent pharmaceutical product consumption capacity. Previously, China has followed the imitating innovative practices and produced only copies of famous drugs. However, the government has entered into contracts that support collaborative innovation practices. They are using the technologies that Western countries have so successfully applied, China plans to move ahead in the pharmaceutical industry in the years to come.

 
 
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  Taobao  
 
 
BusinessManagementMarketingSWOT & PESTLE Writing
 
PESTEL Analysis of Taobao
 
 by Shamsul   
 
 
 
 
 
 
PESTEL Analysis of Taobao
  
 
 
PESTEL analysis of Taobao will highlight its political, economic, social, technological, environmental, and legal factors. It is a leading online shopping platform in China, owned by Alibaba Group. It was launched in May 2003 and is currently headquartered in Hangzhou. The platform has displaced various online shopping giants like Amazon, e-Bay, and more in its region. Its revenue could be more encouraging due to its free of cost services. Read on to explore the complete PESTEL analysis of Taobao.
 
 
Political Factors Impacting Taobao
 
The cost of running a business and long-term sustainability are both impacted by political culture and other factors. Not only do transnational corporations but businesses like Taobao heavily rely on political factors when making investment decisions. Governmental structure, democratic institutions, the likelihood of a military coup, armed conflict, law and order in the marketplace, etc., are a few examples of political factors.
 
1- Separation of Political Responsibilities Among the Various Government Entities
 
The likelihood of one agency exerting excessive pressure is decreased by a large number of government agencies. On the other hand, it does lengthen the business process and raise the cost of clearances and certifications.
 
2- Democracy and Other Democratic Bodies
 
Felix Oberholzer-Gee and Julie M. Wulf contend that further strengthening of democratic institutions is necessary to enable companies like Taobao to flourish in an environment that is free from corruption and characterized by political stability. Increasing transparency and lowering corruption in the nation are two benefits of strengthening democratic institutions.
 
3- Role of Local Government
 
Since enforcement agencies typically report to domestic governments regarding laws, local governments significantly impact the policy-making and regulation-implementation processes.
 
4- Independence of Judiciary
 
The country’s judiciary is mainly independent in business and commerce decisions. Businesses encounter difficulties when proprietary technology and public interest differ, as was the case in South Africa, where the judiciary and government allowed the sale of generic AIDS medications despite the patents of multinational corporations.
 
 
5- Risk of Terrorist Attacks
 
We think that businesses like Taobao must adapt to operating in the wake of a terrorist attack in the post-9/11 world. To lessen the losses brought on by terrorist attacks, it is a wise course of action to use hedging instruments like insurance.
 
6- Regulations and Deregulations from the Government
 
In accordance with WTO standards, the government abides by all laws and rules. Both the creation of policies and their implementation follow a consistent pattern.
 
7- Changes in Government Policy and Change in Government
 
The formulation of policies is consistent from one government to the next. Second, governments abide by the agreements made by the earlier administrations.
 
8- Government Budget Size
 
Both local governments and the national government are operating deficit budgets, which is boosting development in the short term but could cause an increase in inflation in the medium term. Investment grade is the bond rating for the federal government.
 
 
Economic Factors Impacting Taobao
 
The economic conditions in a given nation or region directly impact the market’s overall attractiveness. GDP growth rate, inflation rate, disposable income level, and other economic variables should be assessed by Taobao in both the current market and any future markets.
 
1- Foreign Exchange Rate
 
Before venturing into a new market, Taobao should be cautious about past forex risks. Due to currency risk in Argentina, Venezuela, and Brazil, numerous businesses have suffered losses in recent years. In the nation of Mexico’s frequent currency crisis, numerous US corporations have suffered losses.
   
 
2- Productivity of the Workforce
 
Despite the fact that salaries have not increased to reflect these gains, the US labor force’s productivity has increased by 25 to 30 percent over the past two decades. Taobao may be able to employ qualified workers at market-competitive wages.
 
3- Economic Growth Rate and GDP Trends
 
Growing economic demand is indicated by faster GDP growth. Taobao can take advantage of this factor by broadening its product offering and focusing on new market segments. Analyzing the shifts in consumer purchasing patterns and newly emerging value propositions is an excellent place to begin.
 
4- Demand Transitions from the Goods to the Service Economy
 
Compared to the shares of the economy’s manufacturing, agricultural, and goods sectors, the share of services is constantly rising.
 
 
5- Spending Trend of Government
 
As mentioned in the political section, the nation’s government is operating deficit budgets. The implication for the company is that it could increase short-term product sales while exposing it to medium-term currency and depreciation risk.
 
6- Monetary and Fiscal Policies
 
The tax break culture has raised the debit and could cause financial difficulties for the economy in the future.
 
7- Inequality Index
 
The degree of inequality is an excellent indicator of a society’s harmony and progress. Both temporarily and permanently, it can cause consumption and uncertainty suppression. Crime and conflict are more likely to occur when a country has extreme income inequality.
 
 
 
Social Factors Impacting Taobao
 
Social factors like social power structures, women’s participation in the workforce, and demographic trends have a significant impact on not only the economy of the country but also on the availability of talent in the workforce and customer demand.
 
1- Attitude Towards Immigrants and Types of Immigrations
 
In light of recent events like immigrant detention on the southern US border and Brexit, immigration policy has been intensely scrutinized. Taobao ought to be able to maneuver in such a peaceful environment.
 
2- Attitude Toward Power
 
Different societies and cultures around the world have different views on power. In contrast to the West, where power is something to rebel against, Asia respects power. Taobao should carefully assess its attitude toward authority before kicking off a marketing campaign for its goods and services.
 
3- Birth Rate
 
The birth rate is another reliable predictor of the future. On the strength of a higher level of immigration and a slightly higher birth rate, the USA has dodged the stationary economy of the EU.
 
4- Level of Immigration and Immigration Policies
 
What the nation’s immigration policies are, how many people immigrate, and which industries promote immigration. Taobao can decide if it can hire talent from around the world to work in that specific market.
   
 
 
5- Awareness in Society and Level of Social Impacts
 
Higher pressure from non-governmental agencies, higher customer activism, and pressure groups are frequently a result of higher levels of social concerns in society.
 
6- Societal Standards and Hierarchy
 
The acceptable standards and hierarchy also influence the types and degrees of consumption in that society. The power to make decisions frequently lies at the top of societies with strong hierarchies.
 
7- Type of Social Contract Between Society and Government
 
Taobao must comprehend the type of social contract between society and the state before entering a market. For instance, the United Kingdom health structure is state-owned and contracts at the government level govern everything. It has been really difficult for United States companies to enter the United Kingdom health market.
 
8- Gender Roles
 
Taobao can use the labor market’s gender composition to determine how liberal society is, how much it values women’s rights, and how much influence women have over consumer choices and societal issues. Indicators of household disposable income, priorities, and related demands can be found in the gender distribution of the labor force.
 
 
 
Technological Factors Impacting Taobao
 
Business models in many different sectors are being disrupted by technology. The macro-environment is being impacted by a number of technology trends, including advances in AI (Artificial Intelligence), the use of big data analytics and machine learning to forecast user behavior, and the increasing importance of corporations over other service providers.
 
1- Protection of Technology and Property Rights
 
The legal standing of different property rights and IPR (intellectual property rights) protections that are common in the United States should be examined by Taobao.
 
2- 5G Infrastructure
 
Worldwide efforts are being made to get ready for the installation of 5G infrastructure. Taobao needs to evaluate the extent to which the domestic market is prepared for the rollout of 5G connectivity.
 
 
3- R&D Investment Levels
 
There are excellent chances of creating a self-sustaining ecosystem that fosters innovation if a significant technological sector investment exists. Taobao can take advantage of this circumstance to hire the most qualified workers.
 
4- Digital and Transparency Drive
 
The company can combat corruption by digitizing a number of business processes.
 
 
5- Integration of New Technology
 
Because it attempted to enter China before smartphones were widely used there, Uber was unsuccessful. The company needs to develop a plan that can take into account infrastructure, societal values, and its business model.
 
6- Chances of Technology Disruption
 
Technology disruption in various industries is highly likely in a nation with a concentration of tech firms. Taobao needs to determine whether it can withstand the rapid change of technological disruption in its sector.
   
 
7- Cost of Doing Business and Trends
 
Taobao needs to evaluate the level of automation and trends in the cost of production in the market. In the not too distant future, manufacturing and production will be the industry most significantly impacted by technological advancement.
 
8- Partner Empowerment in the Supply Chain
 
Taobao should investigate the ways in which supply chain stakeholders can benefit from technology. This could aid the platform in increasing supply chain flexibility and transparency.
 
 
 
Environmental Factors Impacting Taobao
 
Environmental considerations are quickly gaining popularity among policymakers, regulators, and consumers. Over 20 percent of the world’s species will go extinct by the turn of this century due to climate and ecosystem changes.
 
1- Climate Change
 
How will climate change impact the company’s supply chain and business model? When shipments from one region of the world are delayed due to an abrupt climate change, for instance, a rigid supply chain can result in bottlenecks.
 
2- Impact of Environmental Agencies on Taobao
 
In order to protect norms, environmental standards enforcement organizations play a crucial role. However, these organizations frequently use process stalling in developing nations as a bribery demand tactic. Taobao should take care of that because such behaviors exist in some nations.
 
3- Paris Climate Agreement
 
What are the nation’s commitments under the Paris Climate Agreement, and how well-received is the agreement nationwide? For instance, there was uncertainty because Trump needed to uphold the United States’ commitments.
 
4- Corporate and Social Responsibilities
 
Are Taobao’s current CSR initiatives still relevant in the new market or do they require a new initiative to serve the potential market?
 
5- Environmental Regulations
 
Environmental regulation has an impact on the industry’s dynamics of absolute cost advantage.
 
6- Customer Activism Related to Environmental Issues
 
Taobao needs to be aware of the extent of customer activism related to environmental issues. It will support the company in creating eco-friendly products and avoiding PR stumbling blocks.
 
7- Focus on Renewable Energy Sources and Technologies
 
What percentage of the budget is allocated to using renewable energy sources, and how can the company invest in this to gain a competitive advantage?
 
 
 
Legal Factors Impacting Taobao
 
Conditions for entering the market, laws governing how to operate in the marketplace, and procedures for resolving conflicts with other investors are all governed by legal factors frequently. Taobao may encounter numerous difficulties if the legal system needs to be stronger, including consumer petitions and shakedowns by legal bodies.
   
 
1- Securities Law
 
What the country’s securities laws are, and what requirements must be met for a platform to list on a national stock exchange.
 
2- Respect for Common Law
 
Is the nation governed by common law, which is the same for all organizations—domestic and foreign—to disputes? Although the legal process is unpredictable, Taobao cannot be confident in the verdicts.
 
3- Transparency in Court Processes
 
For decisions to be consistent and fair, transparency is necessary. If the process is consistent and open, Taobao will be more confident in its ability to make future plans.
 
4- Business Laws
 
Taobao must evaluate the business laws in a new market to determine how they differ from those in its home market before entering.
 
5- Consumer Protection Laws
 
Taobao needs to be aware of consumer laws, how frequently they are enforced, how the government views consumer protection laws, and how activist groups participate in the enforcement of customer protection laws.
 
6- Intellectual Property Rights
 
Taobao should evaluate the level of protection provided by the nation’s legal framework for intellectual property rights.
 
7- Health and Safety Laws
 
What does Taobao need to do in order to comply with national safety and health laws? Taobao would be better served by conducting extensive research prior to venturing into the market because different nations have different attitudes toward safety and health.
 
 
 
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TravelWriting
 
From Emperors to Xi Jinping: The Forbidden City, The Chinese Soul in a Palace
 
 by Shamsul   
 
 
 
 
 
 
 
From Emperors to Xi Jinping: The Forbidden City, The Chinese Soul in a Palace
  
China has very few preserved monuments of the past. The Forbidden City is one of the exceptions. A monumental palace built in the heart of Beijing under the Ming dynasty. Today it embodies the pride of a nation that has become communist but honors its past.
 
The Forbidden City, seen from the northern entrance. It was the residence of emperors for 500 years during the Ming and Qing dynasties.
 
 

 

Built-in about fifteen years under the Ming dynasty in the 15th century, the Forbidden City is one of the rare testimonies of the past preserved in China. This palace, the largest in the world in area (720 hectares), is also one of the most visited place. Deng Xiaoping wanted all Chinese to discover it at least once in their lives. Before being opened to the public in 1925, however, the “dragon’s lair” was a closed. 
 
Forbidden Place: 
 
A city designed to embody the power of the emperor. He is the son of heaven, where the architecture and layout of buildings are never left to chance.
 
 
 
A Preserved Palace From Emperors to Communists:
 

 
   
 
 

“What surprises the Chinese is that the palace is still standing,” explains Cyrille Javary, sinologist, lecturer, and the author of several books on China and the Forbidden City. “The Forbidden City was built by Emperor Yongle, the third emperor of the Ming dynasty. It was built between 1406 and 1420, who moved the capital from Nanjing to Beijing in order to better control the northern border, where the Mongols came from. On the site of the City was the palace of Kublai Khan, former Mongol emperor of the Yuan dynast. This old building was razed to make way for the new one. 
 
However, the tradition was that when a dynasty took power over another, it put seals on the old palace and they built a new one for itself. As they were wooden palaces, they disappeared. Thus, one no longer finds anything of the palace of the previous dynasties. The Han or the Tang, at the time when Xi’an was the capital of China”.
 
But in 1644, a change of dynasty took place, and the tradition was not applied. China was conquered by the Manchus, cousins ​​of the Mongols, who installed the Qing in power. “Like all the invaders of China, they had only one desire, to become Chinese. Therefore, they slipped happily into the palace of the Ming. They maintained and enlarged the Forbidden City, which is unprecedented in Chinese history because before, buildings were allowed to disappear”, says Cyrille Javary.
 
 
 
The Gate of Divine Might
 
 
The Gate of Divine Might
 
 
Over time, the City was maintained and preserved even when the Empire was overthrown with the 1911 revolution. This revolution established the Republic until 1949. Subsequently, the nationalist leaders went into exile on the island of Taiwan. At the same time, the Communists take possession of the country. On October 1, 1949, Mao Zedong proclaimed the People’s Republic of China from the balcony of the Forbidden City of ancient emperors. The curious symbol for the advent of a communist regime? “The Forbidden City has become a manifestation of national pride, of the country’s influence abroad. Moreover, modern China likes to take root in its past,” explains Cyrille Javary. “The Chinese government, Marxist, honors its ancestors. It is the principle of filial piety: the son honors his ancestors by doing better than them”.
   
 
“Today, all Chinese consider themselves to be the sons of the dragon. During the annual military parade on October 1, the head of state walks out through the Tian’anmen Gate, which was the southern forward defense of the Forbidden City. Henceforth, the Chinese call the Forbidden City the ‘old palace'”.
 
The contemporary seat of power is only a stone’s throw from the old one, the Zhongnanhai (literally, the “central and southern seas,” named after the lakes present there and which the Mongol invaders had taken for ). This place is sometimes called the “new Forbidden City.”
 
A closed palace, the embodiment of the emperor’s power.
 
 
 

The Throne Room in the Forbidden City.
 
The throne room in the Forbidden City
 

 

At the time of the imperial dynasties, few Chinese had the honor of entering the Forbidden City. Moreover, you cannot see the City”, according to Cyrille Javaryy, “it is a fortified castle protected by ramparts 10 meters high”. Around these ramparts, moats filled with water encircle the City over 3,800 meters long and 52 meters wide. The military function of the building is reinforced by the corner towers (Jialolou). They are four in number, which serve as a defense for the City and the walls and the ditch. Forbidden City has only four gates pierced through the ramparts: to the south, the South Gate is the main one and overlooks Tian’anmen Square. To the north is the “Gate of Divine Prowess.” We find the “gate of western glory” on the west and the “gate of eastern glory” on the east.
 
 
Dragon’s Lair in the Forbidden City:
 
 
Dragon’s Lair in the Forbidden City
 
 
   
 
“In imperial times, until 1911, the few people who had the right to walk along the Forbidden City were forbidden to turn their heads towards the palace”, says Cyrille Javary. “soldiers watched over the ramparts armed with crossbows. We don’t set our eyes on the dragon’s lair.” But inside, the imperial court is also cut off from the world. At the most populated time, more than 8,000 people resided in the City. “it took people to administer the country and organize the life of the court”. The north was made up of the sovereign’s private apartments. While the south was the part intended to accommodate outside visitors and show off the emperor’s power.
 
The palace is huge to accommodate all these residents. “We sometimes hear or read that the Forbidden City has 10,000 rooms, but that’s not true”, Cyrille Javary, “there are 9,999.5 surface units, ‘dien’ in Chinese. This does not correspond to several rooms with an area. In Japan, we would count in number of tatami mats and in France in square meters. So why not 10,000? Because this number has a very special meaning in China. It designates what is not neither infinite nor measurable. The number of hairs on the head, the number of stars in the sky, of species on Earth etc. However, magnificent he was, the emperor could not reach this number”. But he was close.
 
 
Taoism, Confucianism, Geomancy | The Chinese Soul in a Palace
 
Satellite photo of the Forbidden City
 


 
 

Additionally, The Forbidden City is the place where many Chinese spiritual principles apply: Taoism, imperial secular religion… In Chinese, the full name of the palace is “the Forbidden Purple City”, the earthly residence of the son of heaven, a replica on Earth of the constellation called the Crimson City, containing the only star that does not move, the North Star. “We could compare it to a cathedral of the imperial secular religion”, explains Cyrille Javary, “which applies Taoism, Confucianism, Fengshui. It must first be specified that there is no creator God in China, the word God does not exist in classical Chinese. The Taoists are interested in the invisible and the currents that sculpt the landscape, therefore in Fengshui, the art of geomancy. The Confucians are interested in them to the hierarchical organization of society and rituals”.
 
“As for the imperial secular religion, it is translated by the sky, an impersonal engine that makes the seasons turn, which delegates to his son, the emperor, the power to manage this on a daily basis. On December 23 at 3 a.m., after a week of fasting, the emperor went to the temple of heaven to ask his father heaven to bring back the creative influx of yang to make China green again and the harvests that would feed the people.
 
 
All These Truth can be Found in the Architecture: 
 
The Forbidden City is oriented along the north-south axis. The palace is leaning on a hill to the north and the facades are to the south. When he had the palace built, Emperor Yongle asked his architects to look for their models in the Book of Rites, a collection of principles and traditions inherited from the Zhou dynasty, which reigned over China during the first millennium BC. -Christ. “Yongle believed that the Chinese had forgotten their principles and that this explained why the barbarians – the Mongols – had conquered the country”, decrypts Cyrille Javary. “Thus, the palace is a three-dimensional representation of the deepest principles of the Chinese soul.”
 
The throne room, which has no windows, has 72 pillars. “It is the product of 8 multiplied by 9: 9 being the number of the great yang and 8 the number of yin. On the edges of the roofs, we see funny characters, sons of the dragon, whose function is to protect the buildings magically. At the support of the terrace of the Yang palaces, there is also an enormous stone slab of 200 tons: it is a geomantic support with a role of protection. This slab was dragged over 35 km by 200 donkeys on a road that had been covered in frozen water in January”.
 
But apart from this slab and the foundations, the City is made of wood. Regularly renovated and maintained, it has been listed as a UNESCO World Heritage Site since 1987. The visit is extremely popular with the Chinese: in 2016 and 2017, the City received 16 million annual visitors, i.e. more than 40,000 every day. It received more than 19 million in 2019.
   
 
 
 
 
 
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BusinessManagementMarketing
 
China Mobile Marketing | Strategies used by China Mobile
 
 by Shamsul   
 
 
 
 
 
 
 
China Mobile Marketing | Strategies used by China Mobile
 
 
 
China mobile has a customer base of 820 million, with 312 million users of 4G services only in china. Due to China Mobile Marketing service in 115 countries and international valuable roaming services, it has become the largest operator of 4G in the world. Its enhanced broadband wireless services helped achieve 30 % more data traffic growth in 2015 than in 2014. This data makes it the leader business vertical based on voice and data services.
 
Targeting, Segmentation, Positioning strategy of China Mobile Marketing:
 
China mobile makes use of demographics and psychographics segmentation-based variables for catering to the needs of tech-savvy users. Its targeting strategy mixes selective and differentiating targeting methods that provide value-added and wireless broadband services to corporate and retail customers. With china’s economic and socio-cultural development, data traffic market sales are increased by increasing percentage. It leads to china’s mobile establishment from more than just a communication network-based company, and now it is very well known as 4G LTE and wire-line data provider.
   
 
Competitive Advantage as a part of China Mobile Marketing:
 
China mobile operates from its home country, which gives it a better understanding and knowledge of the economic and demographic country conditions, which has an advantage over other peer companies working in China. This factor plays an important factor in defining their success in the market. A diversified service /product portfolio has always been helping this company to maintain long-lasting and worthy relationships with its customers leading to the decreased cost related to customer acquisition. One of the best competitive advantages it has over other companies is that its proprietary outlets are spreading in different regions of china with 20000+ numbers of outlets.
 
BCG Matrix of China mobile’s Marketing Strategy:
 
Its mobile services, Voice services, and mobile data service businesses are Stars because China mobile company is the leading player in the Chinese market. Its position is dominant in every business vertical it is contributing.
 
Distribution Strategy as a part of China Mobile Marketing:
 
China mobile is using different delivery channels that help make its services available for its customers. Its apps, network coverage, 20k+ proprietary outlets, internet, infrastructure capabilities are the reasons behind the fast and increasing services provided to end customers.
 
Brand Equity as a part of China Mobile Marketing:
 
China mobile is branding through high-quality services, enhanced visibility due to different mediums related to tandem, world-class infrastructure. All these factors are aiding the company to secure positive words from customer’s mouths. Data analysis of 500 companies is done on the basis of 2015 data ranked China Mobile in the top 10. China brands as per Brand services and finance which makes a great fortune.
   
 
Competitive Analysis as a part of China Mobile Marketing:
 
China Mobile is working on strengthening its development and research and has cultivated an innovative culture due to which the company is now ahead of the competitors. Several competitors that provide high-quality services are high, so tariff rates also have strong competition. Still, china’s mobile company is making more profit due to its robust data services network and customer care’s quality-based services.
 
Market Analysis as a part of China Mobile Marketing:
 
China Mobile has 63 % shares in the market and is the leading LTE 4G service provider. In comparison, competitors like Vodafone, Airtel, MTN, etc. are having difficulty facing domestic players-dominated competitive markets.
 
Customer Analysis as a part of China Mobile Marketing:
 
Its customers belong to different age groups, willing to contact their close ones through telephonic communication. That’s why China Mobile handles its valuable customers’ growing needs and demands through its wire-line, digital, and dedicated line-based services.
   
 
 
 
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  Diamond Model  
 
 
BusinessManagementMarketingScholarly
 
Competitive Advantage in China and Saudi Arabia
 
 by Shamsul   
 
 
 
 
 
In this paper, we will analyze  the competitive advantage in Saudi Arabia & China. After intensively studying 100 industries in ten nations, Porter (1990) presented a theory of international trade that explains why economies tend to gain international success within a specific industry (Davies and Ellis, 2000).
 
The Diamond Model of National Advantage comprises of four determinants.
 
The first of these is factor conditions which include capital, human and physical resources, and the country’s knowledge and physical infrastructure.
 
The next category deals with demand conditions like the growth rate and size of the home demand, demand structure within the country, and procedures through which local demand conditions are internationalized.
 
The third category deals with related and supporting industries that work with supplier clusters, institutions of knowledge inputs, and end-users within close proximity, fostering competitiveness and innovation.
 
The fourth factor is structure, strategy, and rivalry. This factor deals with ways through which firms are being managed and are selected to compete along with those ways through which the industries shape education and employer talent.
   
 
Porter’s Diamond of National Advantage Framework
 
 
 
Applying Diamond Framework in the Context of China and Saudi Arabia’s Competitive Advantage
 
Factor Conditions
 
Porter (1998) indicates factor conditions to be those production factors required for competing in industries. This factor is further grouped into broad categories like physical resources, human resources, capital resources, knowledge resources, and infrastructure. In Saudi Arabia, domestic factor conditions can be explained as generalized factors. The atmospheric conditions of the country serve as its competitive advantage. The intensive summer season in Saudi Arabia facilitates the growth of dates which is also a major exporting item.
 
With respect to machinery and skilled labor, the authorities have made extensive investments to overcome this issue. National competitiveness is rendered to be the ability of the industries of a country to generate wealth for the nation (Zinnes, Eilat and Sachs, 2001; Kao, et al., 2008). The government is investing heavily in education; however, the shortage of skilled workers remains considerable. Knowledge resources lack the requirement of the private sector. Saudi Arabia has shown great progress in terms of resource utilization.  However, there is still a lot to do for gaining national competitiveness to its highest level.
 
Competitive Advantage
 
China, on the other side, has access to cheap labor. These workers are trained extensively so as to equip them with specific knowledge, which is a prerequisite for obtaining a competitive advantage (Lenzi 2009). With respect to capital and physical resources, China has maintained its vital competitive position by producing basic products at lower prices. China is inducting efficiency within its production process, which is a determining factor for sustainable growth. The low points of the country include access to qualified labor. The country is investing in education heavily; however, the knowledge resources are not sufficiently aligned with the requirements of the industries.
 
Demand Conditions
 
In the local market, companies can create their competitive advantage when buyers from the home market create more advanced products and innovate faster in comparison to their competitors; however, in the world market, demand conditions are expressed in the form of quantitative world imports by the country. As the largest oil producer, Saudi Arabia is certainly the highest oil exporter, accounting for 76.9% of its total export bill. Other considerable exports include organic chemicals, plastics, and aluminum. In order to increase local demand, industries are heavily investing in R&D so that technology inputs can be assessed and implemented according to customer demands.
 
Most noteworthy, the population of China, the total $2.282 export bill roughly translates to $1,669 for every resident in the country. Furthermore, the unemployment rate in the country is 4.05%. Major exports depend on several categories. These include electronic equipment, furniture, and related items, machines and engines, medical and technical equipment, vehicles and other items. Innovation in the country is fostered by yielding products that are short, small and thin and which are also acceptable globally.
   
 
Comparing the demand conditions of both countries, you can assess that the demand conditions of China are relatively expanded to more categories as compared to Saudi Arabia. Moreover, innovations to increase local demand are also fostered more by China, which is the basis of its fast-paced economic development.
 
Related and Supporting Industries
 
According to Porter (1990), related and supporting industries are rendered as those with which firms share and coordinate activities within the value chain. Or those involved in products that are complimentary for the firm within a nation’s scenario. This involves suppliers’ inputs and sharing of information between consumers so as to improve the innovation and up-gradation process.
 
Saudi Arabia
 
In Saudi Arabia, the presence of related and supporting industries that are internationally competitive in different industries will support their respective sectors Jasimuddin, Sajjad M. (2001). These industries are capable of producing inputs that are crucial for internationalization and innovation. The production inputs provided are very cost-effective along with playing a major role in the up-gradation process, which stimulates other companies operating within the chain to innovate. Different industries relate to and support their relative companies. The dates industry uses it’s related and supported industries to be Dates Packaging Industry, Dates Processing Industry, Cellulosic Industry, and Logistics Industry. On the other side, home-based competitiveness in related industries is very low in Saudi Arabia. Companies are unable to benefit from the flow of information. Moreover, technical interchanges as that accelerate the rate of up-gradation and innovation.
 
China
 
Chinese national advantage in its related and supporting industries is somehow similar to Saudi Arabia. The country has effective resources through which it can make its production process cost-effective, rapid, and early and many times in the most preferential way. Chinese electronics appliances companies are highly competitive in the international market and other Chinese companies are supplying two-thirds of the world’s electronic appliances. Home demand in China is higher as the citizens demand more products from their own country than those imported from other countries. The demands of local buyers provide earlier insight into customer requirements to the companies, which helps them in innovating faster and a sophisticated competitive advantage over other foreign firms (Liu, 2003).
 
On comparing this national competitive advantage of the diamond model. We got the result that both countries have the implementation of a cost-effective production inputs system. Certainly, it helps them in innovating their products faster. However, home-demand factors are superior in China than in Saudi Arabia. There are relatively less related and supporting industries in Saudi Arabia, whereas China is gaining at a fast pace in its industrialization revolution.
 
Company, Strategy, Structure, and Rivalry
 
According to Porter (1990), the presence of strong domestic rivalry is a very important factor to concern as it encourages companies to upgrade. First of all, in Saudi Arabia, the oil sector comprises of intense monopolistic overtones as it is the largest oil producer. National contexts and circumstances strongly impact the organization and management along with drafting the nature of the domestic rivalry. Competitiveness within a particular industry is a result of the convergence of different management practices and modes that work in favor of the country. Saudi Arabia is the largest producer of oil. It emphasizes a strategy that controls the demand, supply and good prices of oil and related products for the mutual benefit of every player within the value addition chain and which fits within the character of the Saudi Arabian management system.
   
 
In China, government intervention is at its highest point. It seems that the government strategy is to avoid internal competition so that the companies concentrate on competing with companies operating on a global basis. With respect to the Chinese management system, people are comfortable working in more engineering and technical backgrounds. Where there is a complex demand accurate manufacturing procedures, after-sale service, careful process of development and a highly disciplined system of management.
 
Comparing Saudi Arabia and China
 
Comparing both countries, we can sit that in Saudi Arabia, successful competitors are mostly small and medium-sized firms. They are operative privately, whereas in China, there is strict regulation for following a hierarchical management practice and managers mostly have a technical background.
 
Part 2
 
In order to improve the competitive advantage of Saudi Arabia. It is very important that it works on its labor policy. Above all, manufacturing procedures offer cost-effectiveness. Hence, the below mentioned are some recommendations that have made China a leader in attaining a national competitive advantage in comparison to other countries in BRICS.
 
Recommendation 1: 
 
Cost Leadership
 
China has managed to attain cost leadership by delivering valuable products at lower prices. This is obtainable by continuously working on improving operational efficiency. It exports products that are of low cost and at a reasonable quality level. This is possible because of the low standard of living, which allows paying workers less.  Saudi Arabia should work on improving its labor force which will, as a result, affect its operational efficiency, thus attaining cost-leadership in different industries.
 
Recommendation 2: 
 
Differentiation
 
Differentiation is another factor that provides a competitive advantage to the Chinese economy. Industries in the country should differentiate in offering high-quality and unique products. Moreover, firms should also focus on delivering products faster so that they can reach more customers. The best thing about this strategy is that companies can charge a premium price for their products. That results in a relatively higher profit margin.
   
 
Recommendation 3: 
 
Focus
 
This strategy helps in understanding and serving the target market better and effectively. Maintaining focus on a specific target market is achievable through either using the differentiation strategy or the cost-leadership strategy. For example, community banks maintain their focus on high-net individuals or small businesses that are ready to pay a bit more like fees for the service.
 
Recommendation 4: 
 
Innovation and Value Creation
 
This is a very important factor for achieving national competitiveness as consumers demand continuously innovative products of high quality. Saudi Arabia should work more on innovation in its products that suit the demands of the end-users.
 
 
 
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