Joysun at the Crossroads
(5 pages of text)
Joysun was established as a state-owned enterprise in the Shanghai Waigaoqiao Free Trade Zone in China in 1995. Thanks to the effective leadership of its general manager and to the monopolistic nature of the Chinese import and export industry in the mid-1990s, the company had grown rapidly from a shop with five employees in its early days to a major player in the logistics industry by the end of 2012. However, Joysun’s journey had been rocky due to the profound and rapid transformation of the Chinese economy over the 17 years of the company’s existence. By the end of 2012, the company had several projects underway to consolidate its market position. Nevertheless, the management team felt that it should undertake more initiatives in order to sustain Joysun’s leadership over time. More specifically, the general manager wondered whether Joysun should enter the cold chain segment of the logistics industry. Considering the country- and industry-level context, what was the strategic relevance and operational feasibility of Joysun entering this new segment?
This case is intended for use in undergraduate and graduate courses in strategic management, global strategy and business environment analysis. It lends itself to the illustration of interactions between public policy, industry dynamics and firm strategy. Students are to use Porter’s Five Forces Model and Diamond Framework to make sense of how country and industry factors co-evolved to shape the firm’s business strategy over time. The case may be used to illustrate the complexity of diversification choices as well as to expose students to one possible way of evaluating strategic alternatives and making informed recommendations. Additionally, students will recognize the temporary nature of competitive advantages and hence the importance of timing in strategic decision-making.
Transportation and Warehousing
China, Medium, 2012
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