Explain star tvs failure in entering the chinese market

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Assignment:

GLOBAL ADAPTABILITY

Congratulations! You have been hired by the highly selective International Strategy team at News Corp. Australia to redefine its international expansion in Asia Pacific (and beyond!)

As you realize, this is not an easy job and the company expectations from you are really high. You impressed everyone in the interview rounds by your knowledge on global adaptability, where you highlighted relevant tools and frameworks that you acquired as part of your SP Jain degree.

You join the team at a very interesting point in time. The company is willing to allocate lots of resources but Nitin Goel, the team leader, is very cautious. He has been a prote´ge´ of Robert Murdoch who alerted him about one of News Corp.'s biggest failures in international expansion: Star TV. The latter lost $500 million trying to deliver TV programming to Asian countries. Like many companies, it was so dazzled by the foreign market's immensity that it ignored the difficulties of pioneering new territories.

When it was launched in 1991, Star TV looked like a surefire winner. The plan was straightforward: the company would deliver television programming to a media-starved Asian audience. It would target the top 5% of Asia's socioeconomic pyramid, a newly rich elite who could not only afford the services but who also represented an attractive advertising market. Since English was the second language for most of the target consumers, Star would be able to use readily available and fairly cheap English-language programming rather than having to invest heavily in creating new local programs. And by using satellites to beam programs into people's homes, it would sidestep the constraints of geographic distance that had hitherto kept traditional broadcasters out of Asia. Media mogul Rupert Murdoch was so taken with this plan-especially with the appeal of leveraging his Twentieth Century Fox film library across the Asian market-that his company, News Corporation, bought out Star's founders for $825 million between 1993 and 1995.

The results have not been quite what News Corp expected. In its fiscal year ending June 30, 1999, Star reportedly lost $141 million (pre-tax), on revenues of $111 million. Losses in fiscal years 1996 through 1999 came to about $500 million, not including losses on joint ventures such as Phoenix TV in China.

Nitin needs to have a serious conversation with you and the rest of the team, as he wants to avoid a similar outcome. You are fully aware that he is concerned about some specific issues, and you should address them in your meeting:

1.) Can the CAGE framework explain Star TV's failure in entering the Chinese market? Please, justify your answer.

2.) You were hired because you are characterized by tenacity and innovative ideas turned into actions. Depict yourself through the CQ Intelligence framework and explain how you can be successful in your new role.

3.) Nitin is aware of certain serious issues in his multi-cultural international strategy team:

There are misunderstandings arising from communication differences.
Members of the team are inhibited by perceived status differences across the team.
Ground rules seem to be absent e.g. in terms of reporting practices.
A couple of your fellow executives seem to be unable to contribute to this ambitious project and do not get along with several of the other executives.

Nitin is eager to hear your thoughts for turning a group of managers in disarray into a winning team of focused executives.

Reference no: EM133355591

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