Developing scenarios for MNCs acting on emerging markets

Abstract

The purpose of this thesis is to develop a scenario technique for MNCs operating on emerging markets. The focal point in the scenario development process is to create awareness of the environment in which the MNC is acting. By using the developed scenario method as a management tool, the organisation improves its preparedness for action, and thus its competitiveness. The capability for fast adaptation to the environment is crucial in emerging markets, and could be the only sustainable competitive advantage for the MNC in the long run.

The scenario technique was developed in a process involving the case company Volvo Construction Equipment in South Korea (Volvo CE Korea), thus enabling us to visualise the process.

The description and analyse of the South Korean environment defined the main driving forces of future environmental change, as well as the determinants for stability. These were the foundations for creating the different scenarios. The scenarios were primarily made to suit the needs of Volvo CE Korea, but could be used by any MNC on the Korean market. The scenarios show that each of the `futures' described constitutes a different set of opportunities and threats for the MNC. These threats and opportunities need to be considered against the MNCs strengths and weaknesses. If the decision makers within the MNC are prepared for different outcomes in the future, their chances of meeting the future opportunities and threats successfully increases.