Britain: Global Legacy and Domestic Persistence

G.  Jones

Chapter | Business Groups in the West: Origins, Evolution, and Resilience | 2018

Britain: Global Legacy and Domestic Persistence

Abstract

This chapter explores the British experience in a volume which examines the historical evolution of business groups in developed Western economies. The chapter argues that during the nineteenth century British merchant houses established business groups with diversified portfolio and pyramidal structures overseas, especially in developing economies, including both British colonies and the independent nations of Latin America. While these types of business groups remained a significant form of firm organization among enterprises specializing in overseas ventures, they did not become the dominant form of large enterprises within British economy itself. Business groups organized under the holding company such as Calico Printers' Association and Associated Portland Cement, as their names imply, were eventually a federation of many specialized companies. As they seldom committed to administrative centralization, their efficiency gain as a business organization remained marginal. The chapter first looks at the appearance and development of industry-focused and family-owned companies before World War II and the relative decline in importance of internationally-focused business groups during the second half of the twentieth century. The chapter then discusses the rise and fall of diversified and conglomerate type of groups like Hanson Trust and BTR, and the more durable Virgin Group and its counterparts. The empirical evidence presented in the chapter demonstrates that diversified business groups can add value in mature markets such as Britain. Even the much-criticized conglomerates of the 1970s-1990s were quite successful forms of business enterprise, and the demise of many of them appears to owe more to management fads than to serious underperformance.

Keywords: business groups; business history; conglomerates; Globalization; Entrepreneurship; Business History; Organizations; Business Conglomerates; United Kingdom;

Format: Print

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Jones, G. "Britain: Global Legacy and Domestic Persistence." Chap. 5 in Business Groups in the West: Origins, Evolution, and Resilience, edited by Asli M. Colpan and Takashi Hikino, 123–146. New York: Oxford University Press, 2018.

Case | HBS Case Collection | June 2018 (Revised November 2019)

John Chambers, Cisco and China: Upgrading a Golden Shield

Geoffrey Jones and Emily Grandjean

This case examines the role of Cisco led by John Chambers in facilitating web filtering in China. It begins by tracing the origins of Cisco as a pioneer of networking equipment. John Chambers, who had worked as a sales manager at IBM and Wang Laboratories, joined Cisco in 1991 and became CEO in 1995. The company expanded rapidly thereafter, acquiring many firms and growing globally, including in China, where it virtually created the internet. The case explores how the firm facilitated surveillance and monitoring of the internet under the Golden Shield project launched in 2000, and in 2004 served as a key participant in the CN2 upgrade that greatly enhanced official capability to filter content online. The case ends in 2007 with Chambers announcing further capital expenditure in China but facing growing criticism by U.S. Congress and others for Cisco's human rights record. At the same time, Cisco faced a powerful domestic competitor in China, Huawei, that had grown rapidly by investing in innovation even as Cisco pursued a share buy-back campaign after experiencing a sharp fall in its share price following the end of the Dot-com bubble. The case provides a vehicle for exploring the ethical and human rights responsibilities of corporations in the technology sector, as well as the impact of the internet on democracy.

Keywords: Cisco; Internet; Governance Controls; Ethics; Rights; Corporate Social Responsibility and Impact; Technology Industry; China;

Citation:

Jones, Geoffrey, and Emily Grandjean. "John Chambers, Cisco and China: Upgrading a Golden Shield." Harvard Business School Case 318-158, June 2018. (Revised November 2019.) View Details

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This case examines the entrepreneurial career of Momofuku Ando, the Taiwanese-born Japanese entrepreneur who pioneered instant boodles with his Chicken Ramen (1958) and Cup Noodle (1971) products. It begins by reviewing his many previous unsuccessful ventures, including two jail terms, during the turbulent era of the 1930s, World War II, and postwar Japan. Following the development of Cup Noodle, Ando and his company Nissin began globalizing the product, beginning with the United States, Brazil and Southeast Asia. The case enables a discussion of the factors behind his many entrepreneurial failures, and his eventual success in the food industry. It looks at the social and economic changes which provided the context for his subsequent development of a successful business in instant noodles, and its globalization. The case also provides an opportunity to discuss the responsibilities of the food industry for the health of consumers. Although instant noodles were cheap and convenient, the high sodium content posed potential health risks, while the packaging of Cup Noodle had an adverse environmental impact.

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Britain: Global Legacy and Domestic Persistence

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