TCL : global strategy at one of China's largest consumer electronics companies successful. What does this tell us about building a global strategy? TCL's global objective We know it clearly that TCL is still far behind the mature world-class corporation.... To be a globally prestigious and most innovative enterprise is our prospect. It will definitely be fulfilled. TCL's Chairman, Li Dongsheng learnt on global strategy from its experience so far. The case has three sections: - Company background and history - Global market for television set manufacture - Global strategy at TCL - progress to date. Company background and history also made history because it was the first Chinese state-owned company to acquire a foreign company. [these] enabled it to reduce the depreciation, therefore lowering the cost of the final products.'Following this early success, TCL then began to develop its European and American business. In 2002, TCL began to integrate its international operations worldwide. It also took the decision to move into European and US markets, the world's two most mature and competitive markets. Brand and distribution building would be too slow and there were substantial restrictions on the import of Chinese televisions sets. TCL therefore acquired the bankrupt German company Schneider TM in 2002 and the American company Govideo TM in 2003. TCL is one of China's leading consumer electronic companies. Its international expansion faced some problems, as the case explains - Richard Lynch partners. We don't want to work alone and have to bear all the risk. That's because in these mature countries [Europe and the USA], the growth is relatively stable and entry barriers are high.' Thomson was important in Europe with its Thomson brand and distribution network and, in the USA, because Thomson also owned the RC brand and related assets.Essentially this was the third stage of TCL's international and global strategy - see By 2006, the TCL Group had annual sales of 50 billion yuan ( $6.4 billion) and was the market leader in the People's Republic of sets. Table 19.2 The stages and strategies of the internationalisation process of TCL Ivule. the purchaser. ODM means Original Design Manufacturer: ODM companies make products that the ODM companies have designed but sell them under the name of the purchaser. Global market for television set manufacture definition television and a switch from analogue to digital television signals. mature technology of the CRT. impact of these measures. advantage against the main global companies in television set manufacture. This presented a real challenge for any new entrant, including TCL.achieve for the existing companies, let alone a new entrant like TCL. 19.3. Based on this evidence, any new entrant into the consumer electronics market will face competitors that are large and with substantial resources - including those in related areas. profit from their television set manufacturing. Global Strategy At TCL Althoug.

1. TCL : global strategy at one of China's largest consumer electronics companies successful. What
does this tell us about building a global strategy? TCL's global objective We know it clearly that
TCL is still far behind the mature world-class corporation.... To be a globally prestigious and most
innovative enterprise is our prospect. It will definitely be fulfilled. TCL's Chairman, Li Dongsheng
learnt on global strategy from its experience so far. The case has three sections: - Company
background and history - Global market for television set manufacture - Global strategy at TCL -
progress to date. Company background and history also made history because it was the first
Chinese state-owned company to acquire a foreign company. [these] enabled it to reduce the
depreciation, therefore lowering the cost of the final products.'Following this early success, TCL
then began to develop its European and American business. In 2002, TCL began to integrate its
international operations worldwide. It also took the decision to move into European and US
markets, the world's two most mature and competitive markets. Brand and distribution building
would be too slow and there were substantial restrictions on the import of Chinese televisions sets.
TCL therefore acquired the bankrupt German company Schneider TM in 2002 and the American
company Govideo TM in 2003. TCL is one of China's leading consumer electronic companies. Its
international expansion faced some problems, as the case explains - Richard Lynch partners. We
don't want to work alone and have to bear all the risk. That's because in these mature countries
[Europe and the USA], the growth is relatively stable and entry barriers are high.' Thomson was
important in Europe with its Thomson brand and distribution network and, in the USA, because
Thomson also owned the RC brand and related assets.Essentially this was the third stage of
TCL's international and global strategy - see By 2006, the TCL Group had annual sales of 50
billion yuan ( $6.4 billion) and was the market leader in the People's Republic of sets. Table 19.2
The stages and strategies of the internationalisation process of TCL Ivule. the purchaser. ODM
means Original Design Manufacturer: ODM companies make products that the ODM companies
have designed but sell them under the name of the purchaser. Global market for television set
manufacture definition television and a switch from analogue to digital television signals. mature
technology of the CRT. impact of these measures. advantage against the main global companies
in television set manufacture. This presented a real challenge for any new entrant, including
TCL.achieve for the existing companies, let alone a new entrant like TCL. 19.3. Based on this
evidence, any new entrant into the consumer electronics market will face competitors that are
large and with substantial resources - including those in related areas. profit from their television
set manufacturing. Global Strategy At TCL Although TCL has gained from its international
strategy, there remained problems in four areas: 1. High market entry barriers. TCL faced strong
protectionism in West Europe and North America in recent years. cross-border deals. slow
response to the technology changes in the industry, therefore missing an opportunity to catch up
with its established rivals. 4. Lack of managerial talent. With rapid international expansion, TCL
faced a severe shortage of managerial talent with international experience. Although they were
cheap to acquire, it turned out that their brands had a poor reputation and were a hindrance in
achieving the objective of market penetration. but the European business was doing great, but we
had underestimated the challenges involved in rescuing Thomson's business.'Source: Richard
Lynch, from company Annual Report and Accounts. problems in developing a global business. (c)
Copyright Richard Lynch 2021. All rights reserved. This case was written by Professor Richard

2. Lynch with Dr Zhongqi Jin and Dr Yi Zu, Middlesex University, London, UK.. Case questions 1.
Using the benefits of global strategy outlined in this chapter, how does TCL rate against such
benefits? And how does TCL rate against its competitors? 2. What were the problems faced by
TCL in building a global strategy? Can they be overcome? How?