Pierre-Yves Donzé

European luxury big business and emerging Asian markets, 1960–2010

This article tackles the transformation of the European luxury business since the 1960s, through the examples of the French fashion industry and the Swiss watch business. It argues that emerging Asian markets, that is, Japan between the 1960s and the 1990s and subsequently China since 2000, have played a key role in this process as the major outlets. It examines the strategies adopted to access East Asia markets and how they were affected by the emergence of luxury multinational enterprises (MNEs) in the 1980s. While department stores were a gateway to Japanese market since the 1960s, they gradually lost their bargaining power when French and Swiss MNEs began to internalise distribution and to implement a global brand management strategy. This feature is also a major characteristic of the distribution of luxury goods in China, where MNEs are directly involved.

Siemens and the Business of Medicine in Japan, 1900–1945

This article focuses on the involvement of Siemens in the market for radiology equipment in Japan between 1900 and 1945. It explores why the German multinational company was unable to keep its dominant position in the Japanese market in the interwar years despite its technological competitiveness. At this time the Japanese medical market was already well structured when the country opened up to the West. In particular, it examines the firms strategic choices in relation to the changing economic and technological environment, highlighting the importance for foreign multinationals of working together with national trading firms involved in the distribution of drugs and products for doctors.

Nestlé coping with Japanese nationalism: Political risk and the strategy of a foreign multinational enterprise in Japan, 1913–45

This paper focuses on the strategy adopted by the MNE Nestlé in Japan between the establishment of a branch at Yokohama in 1913 and the end of World War II. It highlights the difficulties encountered by the firm in its attempts to open up and operate production facilities due to strong opposition from local condensed milk makers, supported by the state. Eventually, in 1934, Nestlé opened a factory by founding an incorporated company, ARKK, all of whose shareholders were Japanese working for Nestlé. Although the war drastically curtailed the activities of both Nestlé Japan and ARKK, the organisational facilities set up during the inter-war period provided a springboard for Nestlés post-war success in Japan.

Switzerland and the industrialisation of Japan: Swiss direct investments and technology transfers to Japan during the twentieth century

After the United States, Switzerland was one of the main sources of FDI to Japan in the twentieth century. Swiss multinationals that have invested there have three characteristics in common. First of all, they take a long-term perspective. The main companies present at the beginning of the twentieth century (Brown Boveri, Ciba, Nestlé, Sandoz, Sulzer) were still some of the largest Swiss companies in Japan at the end of the century. Second, they gradually shifted from distribution to production during the inter-war period. Third, they backed Japans industrialisation by strengthening historically underdeveloped sectors (chemicals) and by contributing to the growth of the manufacturing industry (machines).

Siemens and the Construction of Hospitals in Latin America, 1949–1964

This article focuses on the construction of turnkey hospitals in Latin America by the German electromedical equipment maker Siemens-Reiniger-Werke (SRW) in the 1950s and 1960s. After World War II, SRW was unable to return to the overseas markets it had lost during the war through only the export of goods. Hospital construction was thus a way to reenter these markets, offering local governments a new form of service and product: a German hospital. In order to achieve this strategy, SRW organized and directed an informal association called Deutsche Hospitalia, which gathered together some thirty German manufacturers involved in the process of building a fully equipped hospital. This article argues that SRW, by diffusing a standardized hospital model in Latin America, contributed to the globalization of medicine.

Retail Networks and Real Estate: the case of Swiss luxury watches in China and Southeast

Abstract Shopping centers are among the most significant places to sell luxury goods in East Asia. However, the relations between retail networks of luxury companies and access to land and real estate still need to be addressed. On the one hand, an extensive literature highlights how the turn to luxury industry since the 1990s has enabled some European countries to maintain their comparative advantage on the global market and at the same time to keep a significant part of their production non-globalized. Yet, an issue that remains to be addressed is the way European luxury companies are able to enter and expand their sales networks in emerging countries. On the other hand, while real estate has become a major economic circuit in East Asia, there is still a lack of research about the property industry and companies’ concrete strategies and business models. This article is hence an exploratory study that tackles the issue of real estate within the strategies of the main actors of the Swiss watch industry, namely Swatch Group, Richemont, and LVMH, which have massively invested in their retail network in China and East Asia since the 1990s.

Global value chains and the lost competitiveness of the Japanese watch industry: an applied business history of Seiko since 1990

An applied business history approach offers particular insights into the lost competitiveness of the Japanese watch company Seiko and its causes. Although Seiko was the worlds largest firm in the watch industry in the mid-1980s, the company experienced a huge decrease in sales during the next decade and became unable to compete effectively against Swiss watch companies that had repositioned themselves in luxury business. The focus on the evolution of global value chains (GVC) in the industry, which saw a shift from producer-driven GVC to buyer-driven GVC, highlights a major change in the 1990s. Seiko did not change its strategy despite this paradigm shift and has continued to run its foreign subsidiaries according to the producer-driven model.

The transformation of global luxury brands: The case of the Swiss watch company Longines, 1880–2010

Abstract This article discusses the transformation of global brands between the 1880s and the early twenty-first century, through the example of the Swiss watch company Longines. It shows that the concept of ‘global brand’ changed over time and was related to the nature of the product. Until the 1970s, luxury was linked to precision. Manufacturers focused on the production of movements and adapted the design of end products to each market. Yet the paradigm shift brought about by electronics led to a new definition of luxury during the 1990s, a change which led to a new generation of global brands.

Multinational Enterprises and the Globalization of Medicine: Siemens and the Business of X-ray Equipment in Non-Western Markets, 1900–1939

Whereas the globalization of medicine since the middle of the 19th century has primarily been approached as the sociopolitical and cultural outcome of imperialism, this article argues that Western big business also played a major role through the worldwide export of standardized medical technologies. It focuses on the expansion of Siemens on the X-ray equipment market in non-Western countries during the first half of the twentieth century. This German multinational enterprise experienced slight growth from the mid-1920s onwards but relied mainly on two markets (Argentina and Brazil). It specialized in providing large-scale equipment to a few urban hospitals and engaged during the 1930s in large-scale hospital development together with local authorities and international organizations in various countries (China, Peru, and Central Africa). However, Siemens had great difficulty in expanding its business to include private doctors and inland outlets, where it faced intense competition from other Western X-ray producers. This paper emphasizes that this shortcoming stemmed from a direct application of the European strategy (high-quality, expensive equipment for hospitals) to non-Western markets, where health systems differed.

The Watchmaking Enterprises and the Growth of a Special-purpose Machine Tool Industry in Japan (1890-1960)

This paper focuses on the production of machine tools by the Japanese watchmaking companies, particularly within the group Hattori & Co (current Seiko Group), between the 1890s and the 1960s. The workshop set up by this company to provide machines for its own needs led to the creation of an autonomous company at the beginning of the 1960s, Seiko Seiki Ltd, a competitive fi rm producing machines for customers out of the group. This spin-off process is the result of the development of organizational capabilities since the interwar period, which process is examined in this contribution. Since the first attempts to manufacture watches in Japan, the use of precise machine-tools appeared to be a key issue to be able to produce watches accurate enough to compete with foreign watches. Hattori Kintaro, who opened a manufacturing plant at Tokyo in 1892, did acquire Swiss, German and American machine tools as early as the middle of the 1890s and went on until the Second World War. Besides, he opened a workshop within his factory in which foreign machine were copied. He engaged some University graduate engineers after World War I to supervise this production. The in-house manufacturing of machine tools grew steadily after World War II, in the context of the organization of the mass production of watches by University graduated engineers, numerously engaged by Hattori & Co in the 1950s. Machine-tools were a key element of this new system of production. Some Swiss automatic lathes were chosen and copied within the company, with the collaboration of the machine maker Tsugami and the professor Aoki Tamotsu from the University of Tokyo. The know-how obtained in this process made it possible for Hattori & Co to raise its range of products and to become a competitive machine tools maker, through its fi rm Seiko Seiki (1964). Classifi cation codes: L 64, N 65, N 85, O 32