Selling the sewing machine around the world: Singer's international marketing strategies, 1850–1914
The diffusion of the sewing machine across the world was remarkably high for the period before 1914. The fact that Singer was able to capture almost all of this demand has been explained here not as the result of deliberate marketing strategies attempting to build barriers to competitive entry in emerging markets. In fact, Singer's marketing strategies were crude and undeveloped, even by the standards prevailing in international business by 1914. Rather Singer's extraordinary success in foreign markets was more due to the peculiarities of the demand conditions surrounding consumer purchase of a complex consumer durable like a sewing machine. In particular, the combination of installment purchase contract and the regular presence of canvassers and collectors meant that sewing machine consumers, women in their homes, were able to overcome the inherent uncertainties associated with such a purchase. By investing in a retail organization, Singer minimized the costs to women sampling this complex product before purchasing. It was this investment in these market support services that constituted the building of their global brand. The company's reward was to be the principal recipients of a mass consumer demand around the world. Singer's growth and emergence as one of the largest companies of the early twentieth century was squarely built on scale economies in marketing, especially in the distribution of a branded complex consumer durable with its attendant market support services. The company captured enormous market share not because of any anticompetitive strategy but through recognizing early the importance of marketing and for its evangelistic zeal for reaching out to its potential customers and making their purchasing decision easy.
From Markets and Hierarchies to Alliances: Distribution in the Global Alcoholic Beverages Industry, 1960–2004
Four significant trends are apparent from this study on the international distribution of alcoholic beverages over time. A first evident trend is that at each moment in time, firms have tended to use several types of governance structures simultaneously to distribute their brands – such as wholly owned channels, alliances and wholesalers – each one adapted to the strategy of a particular market or region, to the product being traded (wine, beer or spirits), or the specific brand being marketed. A second trend is that alliances in distribution tended at first to involve one large firm, which owned brands that were leaders in specific market segments and types of beverages. By the beginning of the twenty first century it was common for alliances to be formed between firms of all sizes, including leading multinationals which were direct competitors. A third important trend relates to the apparent correlation between the country of origin of the largest firms and the time period in which they started using alliances in to distribute their brands. In countries such as the US and the UK which developed capital markets where shares of most of the large firms were publicly quoted (even when families kept control of the shares), alliances in distribution developed very early in the century. In Continental Europe and Japan, by contrast, this type of alliances became widely used from the 1970s and 1980s. Finally, a striking feature of this industry is that, despite the high risk of failure that exists in alliances, over time this became an increasingly important alternative governance structure used for international distribution. Alliances in distribution focused essentially on obtaining economies of scale and scope in logistics, as firms started to retain control over their marketing operations and to minimise externality costs. Despite the wide variety of modes of distribution ranging between the market and hierarchy, the high frequency of global alliances between competitors in distribution of alcoholic beverages over time shows the key role they may have in explaining the dynamics in the international evolution of firms. This same argument is as true in any other beverages and food products industries characterised by a high level of competition and globalisation.
Networks and Hierarchies in 19th century
The Neuschloszes and the Gregersens both reached the climax of their career during the fin de siecle period. They both were family firms or family of firms, they were both active in the building industry, dealing with wood processing that included taking forests on lease as well as manufacturing furniture. Though their activities were similar, their business organizations were radically different. At the time the Neuschloszes had been present in Hungary for about a century, and they had a wide range of relatives through intermarriages with other entrepreneur families. The founding father of the Gregersens, however, arrived only at the middle of the 19th century, the family members were participating in one firm only. The two families represent two clear types. The Gregersen firm fits well into Williamson's criteria -- hierarchy is established to compete uncertainty and mistrust. The activities of the Neuschloszes were based rather on a family of firms held together by the family network.
When analyzing networks, we can look at the strong and weak ties. No wonder, business relations were evolving along the former. According to historical evidence, weak ties played a role only in the personal preparation for entrepreneurship -- informal professional education was organized this way. There is one case where we can ask if the bankruptcy of Gudbrand Gregersen was a result of weak ties. At first glance, it was, still if we have a closer look, the case shows how and why the latecomer Gregersen was in a state of uncertainty and so it gives an additional explanation why he insisted on organizing a centralized and hierarchical firm.
The Business Strategies of Fathers and Sons: An American Family in the 20th Century
Certain characteristics are common to family firms around the world. For example, in almost all cases either the family grows faster than the firm or vice versa. Another example is that the family firm demands a mixture of money, power, and love, which can prove a potent brew indeed. Other characteristics of family firms are specific to the nation in which they are created and grow. Different nations not only have different formal rules and regulations but also differ in their expectations of how businesspeople should conduct themselves. The article deals with the family of Thomas J. Watson, Sr., and the International Business Machines Corporation, which he and his oldest son Thomas J. Watson, Jr. ran for 57 years, from 1914 to 1971. The presentation will pay attention both to how the common characteristics of family firm featured themselves in the case of IBM and also to how the fact that IBM was founded in America affected the dynamics of the Watson family and the strategy of the firm. Specifically, it focuses on the pros and cons of handing this company over from father to son and why the two men ran the firm in a different way.
The Business Strategy of Fathers and Sons: A Hungarian Family in the 19th and 20th Centuries
In the second half of the 19th century the flour milling industry was the most important sector in Hungarian economy, Hungarian milling products, owing to their excellent quality, had a good market position in Europe and all over the world. The biggest steam-driven flour mills were built in Budapest, the Pesti Hengermalom Társaság, established in 1838, being the first one. In the last third of the century, the story of Hengermalom became closely intertwined with the story of a family and the head of it, Konrád Burchard-Bélaváry.
Konrád Burchard joined the company in the early 1860s. He moved up the official hierarchy from senior servant, through manager, member of the board of directors, vice-president, to president and chief executive officer. Besides his often-mentioned diligence, his wealthy and influential father-in-law paved the way for his career. Burchard's ascending positions in the company were followed by rising stockholdings, till he became the oneperson manager by the beginning of the 20th century. He grew into an important person in the Hungarian milling industry as well as in economic and public life owing to his different positions in other companies and societies. He made an effort to initiate his family into the leader- and ownership of Hengermalom. His son-in-law, later his younger son became chief executive officer, his elder son was a member of the board of directors, later vice-president and his nephews members of the supervisory board. Konrád Burchard definitely intended to make Hengermalom a patrimony for his sons. The strategy of the sons, however, was different. When Hengermalom was forced to make bigger investments and the mill – as well as the milling industry in general – began to decline in the 1910s, the sons persuaded the father to join a bigger millcompany in 1916. Konrád Burchard died the same year. The company totally merged into the Első Budapesti Gőzmalom Rt. in the 1920s, but the economic and social prestige built by Konrád Burchard-Bélaváry lived on in his sons' economic and social positions.
Bankers and Bureaucrats. The Board of Directors and the Directorate of the Hungarian General Credit Bank (1876-1905)
The Hungarian Commercial Law of 1875 – following the principles of German codification – ordered to create a "directorate" and a "control committee" for the management of joint stock companies. The original German model gave the right to make strategic decisions during the period between two General Assemblies into the hands of the "Aufsichtsrat" and the task of everyday executive management was assigned to the "Vorstand". In Hungary, however, the control committee became in practice an insignificant technical body in the companies, only formally controlling the balance sheets for the general assembly. The Hungarian General Credit Bank (Magyar Általános Hitelbank, 1867: foundation; 1870: take-over the former Pest branch of Österreichische Creditanstalt; 1873: as a member of the Rothschild-Creditanstalt Consortium the contracted state bank of the Hungarian government) chose a special solution to meet the requirements of the law: the Directorate of the bank was duplicated. According to the new statute of 1876, a "Board of Directors" (10–16 people) and a "Directorate" (3-4 people, including the general director) were formed. All the members of both bodies were elected by the General Assembly (the general director was elected from among the directors by the board). The members of the Directorate being responsible for the everyday business were invited to the monthly meetings of the Board of Directors, they had to ask for authorization for the main transactions and report on them, but they had no vote on them. The personal careers of the directors (Vince Weninger, marquis Ede Pallavicini, count Mark Wickenburg, Elemér Horváth, Zsigmond Kornfeld, Adolf Ullmann) are also worth special attention. In 1906 Kornfeld, the former general director and the new president reorganized the managing bodies of the Credit Bank. Instead of the board of directors, a new (broad) directorate (10-15 people) was formed, which appointed 3-4 managing directors. The newly organized executive committee consisted of 2-3 members of the directorate and all managers (regardless of their membership in the directorate). The unification of the positions of the president and the general director concentrated the strategic and executive power in one hand and by mixing the managers and directors in several bodies the bureaucratic machine of the bank became more flexible and effective.
Austria's Economic Performance in the 20th Century. Some Remarks on the Role and Influence of Banks and Industry
Most historians nowadays agree that the "purest" form of universal banking was found in Austria-Hungary. One of the striking features of the Austrian banking system was the close relationship between industry and commerce (even in comparison with other universal bank systems). The article focuses on a couple of problems arising from this fact. First of all, it discusses whether the banks with their accumulation of functions dominated industry as often stated, and if there were any signs of industrial emancipation. Austria's eventful history in the 20th century has been reconsidered. The period from the Habsburg Monarchy till Austria's First Republic is characterized as one of the worst economic performances of the interwar period, while the period from Austria's integration into Nazi Germany till the country's Second Republic with a relatively huge nationalized banking and industrial sector and with an economic upswing similar to Germany's "Wirtschaftswunder" led Austria to became one of the richest countries in the world. The impact the banking system had on the different stages of this process has also been presented. Nowadays concentration, privatization and internationalization characterize the financial sector in the age of globalization and have led to increased foreign ownership in Austria's economy. On the other hand, the breakdown of the former Communist regimes strengthened Austria's "bridge function" towards these new markets and especially Austrian banks – by using different strategies – could gain important positions in these economies. Austria's economy now moves toward regaining its former sphere of influence.
Chemical Works Dynamit Nobel at the Crossroads of Central-European History, 1873-1945
The Dynamit Nobel joint stock company (Pressburg-Bratislava-Pozsony, 1873) belonged to the network of factories of Alfred Nobel spread across Europe and beyond it. With the escalation of armament and the coming of war, the Dynamite Nobel Works acquired strategic importance as a major supplier of munitions for the land and naval forces of Austria-Hungary. The First World War brought the first great boom, raising the employee base working in the factory to about 3000.
The break-up of the Monarchy and the incorporation of Pressburg into the newly formed Czechoslovakia brought significant problems for the Dynamit Nobel Works. Production stagnated, and so it intensively sought a substitute production programme. In the late 1920s and 1930s, the already consolidated Works founded several subsidiary companies in Austria, Yugoslavia, Hungary, Romania and Switzerland. Before the Anschluss, it belonged to Danymit AG of Troisdorf, an IG Farben subsidiary, which already controlled two major Austrian producers as well. Despite its capital participation, the IG Concern was able to influence neither the composition of boards nor the business policy of the DN Bratislava enterprise. After the annexation of Austria, DN Bratislava combined with its numerous South-East European participations became the center of IG Farben's expansion in the area. From 1939 to 1943, the DN Bratislava combine founded seven new subsidiaries and obtained share in another six companies in Central and South-East Europe. In 1945, DN Bratislava entered an entirely new stage of its existence. As leftist democratic regimes came to power in the states in this region, hopes of re-establishing economic cooperation through the old links between the central enterprise and its subsidiary revived. These hopes, however, were never fulfilled.
Cartels and Managers. Inter-firm Relations in Iron and Steel Cartels, 1886–1931
There were two periods of cartelization in the Austro-Hungarian Monarchy. In the first period until 1900, the low level of inter-firm cooperation hindered effective protection of the internal and export markets. In 1902 new iron and steel cartels were formed in the Monarchy. Institutions were established in order to inspire confidence and better cooperation. Both the Austrian and the Hungarian cartels were created on the same principles, and shared the same organizational structure that made joint operation possible. The newly formed common iron cartel reached significant results. Price decline was stopped and a compromise on the protection of the domestic markets could be reached with Germany and other major European producers.
After World War I, iron and steel producers of the successor states revived former cooperation relatively early. Long-standing personal contacts and common interests helped to alleviate serious problems caused by World War I and the peace treaties. International cartels aimed to stabilize steel production and prices by reconstructing market structures of the period before 1914. These efforts, however, were unsuccessful. Changes in the institutional and political environment, the resulting lack of confidence and economic depression made well functioning inter-firm cooperation impossible.
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