Effective Innovation Strategy of Korean SMEs for Emerging Markets: A Supply Chain Management Perspective

Abstract

Emerging markets in the third world countries provide good opportunities and challenges for both large firms and small and medium enterprises (SMEs) that are aiming for the global market expansion. Particularly, the rapid economic growth in the Southeast Asian countries including India, Indonesia, Malaysia, Thailand, and Vietnam presents a window of opportunities for global-oriented Korean SMEs that are at disadvantage compared to the large firms in global expansion efforts. These Southeast Asian markets, however, require an effective innovation strategy because the nature of these emerging markets is somewhat different from those markets in North America, Europe and Northeast Asia. This paper examines effective innovation strategy for entering these Southeast Asian countries by employing the perspective of supply chain management strategy. This paper first defines the market characteristics of the Southeast Asian countries, and then goes on to present an effective innovation strategy model. Case illustrations are provided to explain how some Korean firms successfully entered into the Southeast Asian markets. Implications and future research issues are discussed.