Southern Implants: Designing and Manufacturing Dental Implants to the World
(8 pages of text)
Southern Implants, a South African dental implants manufacturer, was considering how to diversify its risk. Over the last 30 years, the company had grown from a local manufacturing company and now served customers around the world through distributors and subsidiaries. The founder and managing director was particularly concerned about the final stages of production which involved cleaning, sterilizing, and packing. While Southern Implants had four machine shops across South Africa, the final stages of production involved all items coming back to Southern Implants for these final packaging steps. The managing director wanted to set up another processing cleaning plant abroad, but he wondered what location for this plant would be best. The United States was the largest market for Southern Implants but labour costs were high. Portugal was another option and had an investor-friendly economic environment with no discrimination between domestic and foreign investors. What were the organizational and managerial risks to consider before making this decision?
The case is suitable for use in graduate level courses in international business, in management development programs, or in short executive education courses focusing on foreign direct investment (FDI) risk taking and investment location decisions related to FDI from an emerging market perspective. The case allows students to consider various elements of FDI and associated risks. After working through the case and assignment questions, students should be able to
- explain FDI; the ownership, location, internalization (OLI) framework; and the perspectives that help analyze FDI risk-taking decisions and their management;
- compare and contrast investment locations from an investment climate perspective; and
- evaluate risk-related vulnerabilities of top management teams that influence continued organizational and international success.
South Africa, Large, 2019
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