MNB3701 MAY JUNE
PORTFOLIO (COMPLETE
ANSWERS) Semester 1
2025 - DUE 2 June 2025
For assistance contact
Email:
,Question 1: Identify and explain China's formal and informal institutions affecting Uber's
operations. Give TWO examples of each institution from the case study to bolster the arguments
made. (15)
Formal Institutions: They are the clear-cut rules, laws, regulations, and policy formulated by the
government and legal system. They contain effective mechanisms of enforcement.
Explanation: China's formal institutions would have a significant impact on how Uber
could conduct business there, including access to the market, licensing, data privacy,
and regulations on competition.
Government Regulations on Ride-Hailing: The government of China may have included specific
regulations concerning ride-hailing services, e.g., the compulsory local storage of data, the need
for specific licenses for drivers and cars, or restrictions on price models. The case
study may provide Uber's attempts to comply or challenges in adapting to these regulations.
Competition Regulations and Anti-Monopoly Policies: China's anti-monopoly policies could
have affected Uber's expansion and market share, especially on local players like Didi Chuxing.
The case study might present investigations, fines, or restrictions due to such policies.
Informal Institutions: Customary but unstated rules, conventions, mores, traditions,
and beliefs that regulate behavior and interaction in a society. They typically emerge from
culture, morals, and societal practices.
Explanations: Informal institutions of China such as the value of "guanxi" (relationship),
business manners, and consumer preferences would have influenced Uber's market
entry, partnership, and customer acquisition strategies.
Possible Examples (need case study to affirm):
The Role of "Guanxi" in Business: Building strong relationships with government officials and
local business allies might have been critical to the success of Uber or gotten into trouble due
to being foreign in nature. The case study might give instances where "guanxi" played a part in
approvals, partnerships, or even native companies' competitive advantage.
Consumer Perception and Brand Trust: Chinese consumers might have
had existing brand preferences for local brands or data security concerns with foreign companies.
Uber would have needed to build trust and alter its branding and
communication strategy accordingly. The case study could be used to show how Uber tried to
localize its brand or negate trust issues.
Question 2: Apply the national competitive advantage theory (Porter's Diamond) to the case.
Provide FIVE examples from the case study. (10)
Porter's Diamond model suggests that the competitiveness of a country in one particular
industry is determined by how four determinants play with one another:
Factor Conditions: Domestic factors (such as human capital, infrastructure, natural resources,
knowledge).
, Demand Conditions: Size and type of home-country demand for products or services of the
industry.
Supporting and Related Industries: Presence of internationally competitive supplier industries
and related industries.
Firm Strategy, Structure, and Rivalry: Country conditions that determine how firms are created,
organized, and managed, and domestic rivalry conditions.
Potential Examples (need case study to confirm):
Factor Conditions (Large Urban Population and Penetration of Mobiles): The large population of
Chinese cities and massive penetration of mobile phones offered a vast latent market for ride-
hailing services, an important factor condition.
Demand Conditions (Need for Convenience and Digital Services): Increased demand by Chinese
consumers for convenience, mobile-oriented services, and digital payments fueled
the need for services provided by Uber.
Supporting and Ancillary Industries
(Deep Digital Payments and Infrastructure): Deep digital payment and infrastructure in
China, for example, pervasive internet availability and popular mobile payment systems like
Alipay and WeChat Pay, facilitated the utilization of ride-hailing applications.
Firm Strategy, Structure, and Rivalry (Hostile Domestic Competition from Didi Chuxing):
The hostile domestic competition from highly capitalized and politically connected
local firms like Didi Chuxing made the competitive environment very challenging and
had Uber's management at its wit's end in strategy and profitability.
Government Support for Domestic Innovation: Chinese government initiatives and support
for domestic technology innovation might have indirectly helped domestic players like Didi
Chuxing, rendering foreign entry a challenging competitive environment.
Question 3: Evaluate the advantages China can offer Uber in terms of its investment in
China. Supply FOUR instances for each type of advantage from the case study
to further develop arguments made. (10)
China could potentially have offered Uber several potential advantages:
Market Size and Growth Potential:
Colossal Population: China has the world's largest
population, which represents a huge prospective base of customers for ride-hailing.
Rapid Urbanization: China's urbanization process led to an increasing demand
for city transport solutions.
Rising Middle Class: A growing middle class with increasing disposable incomes could afford
and choose convenient transport like Uber.
High Mobile Adoption: High mobile phone and internet
PORTFOLIO (COMPLETE
ANSWERS) Semester 1
2025 - DUE 2 June 2025
For assistance contact
Email:
,Question 1: Identify and explain China's formal and informal institutions affecting Uber's
operations. Give TWO examples of each institution from the case study to bolster the arguments
made. (15)
Formal Institutions: They are the clear-cut rules, laws, regulations, and policy formulated by the
government and legal system. They contain effective mechanisms of enforcement.
Explanation: China's formal institutions would have a significant impact on how Uber
could conduct business there, including access to the market, licensing, data privacy,
and regulations on competition.
Government Regulations on Ride-Hailing: The government of China may have included specific
regulations concerning ride-hailing services, e.g., the compulsory local storage of data, the need
for specific licenses for drivers and cars, or restrictions on price models. The case
study may provide Uber's attempts to comply or challenges in adapting to these regulations.
Competition Regulations and Anti-Monopoly Policies: China's anti-monopoly policies could
have affected Uber's expansion and market share, especially on local players like Didi Chuxing.
The case study might present investigations, fines, or restrictions due to such policies.
Informal Institutions: Customary but unstated rules, conventions, mores, traditions,
and beliefs that regulate behavior and interaction in a society. They typically emerge from
culture, morals, and societal practices.
Explanations: Informal institutions of China such as the value of "guanxi" (relationship),
business manners, and consumer preferences would have influenced Uber's market
entry, partnership, and customer acquisition strategies.
Possible Examples (need case study to affirm):
The Role of "Guanxi" in Business: Building strong relationships with government officials and
local business allies might have been critical to the success of Uber or gotten into trouble due
to being foreign in nature. The case study might give instances where "guanxi" played a part in
approvals, partnerships, or even native companies' competitive advantage.
Consumer Perception and Brand Trust: Chinese consumers might have
had existing brand preferences for local brands or data security concerns with foreign companies.
Uber would have needed to build trust and alter its branding and
communication strategy accordingly. The case study could be used to show how Uber tried to
localize its brand or negate trust issues.
Question 2: Apply the national competitive advantage theory (Porter's Diamond) to the case.
Provide FIVE examples from the case study. (10)
Porter's Diamond model suggests that the competitiveness of a country in one particular
industry is determined by how four determinants play with one another:
Factor Conditions: Domestic factors (such as human capital, infrastructure, natural resources,
knowledge).
, Demand Conditions: Size and type of home-country demand for products or services of the
industry.
Supporting and Related Industries: Presence of internationally competitive supplier industries
and related industries.
Firm Strategy, Structure, and Rivalry: Country conditions that determine how firms are created,
organized, and managed, and domestic rivalry conditions.
Potential Examples (need case study to confirm):
Factor Conditions (Large Urban Population and Penetration of Mobiles): The large population of
Chinese cities and massive penetration of mobile phones offered a vast latent market for ride-
hailing services, an important factor condition.
Demand Conditions (Need for Convenience and Digital Services): Increased demand by Chinese
consumers for convenience, mobile-oriented services, and digital payments fueled
the need for services provided by Uber.
Supporting and Ancillary Industries
(Deep Digital Payments and Infrastructure): Deep digital payment and infrastructure in
China, for example, pervasive internet availability and popular mobile payment systems like
Alipay and WeChat Pay, facilitated the utilization of ride-hailing applications.
Firm Strategy, Structure, and Rivalry (Hostile Domestic Competition from Didi Chuxing):
The hostile domestic competition from highly capitalized and politically connected
local firms like Didi Chuxing made the competitive environment very challenging and
had Uber's management at its wit's end in strategy and profitability.
Government Support for Domestic Innovation: Chinese government initiatives and support
for domestic technology innovation might have indirectly helped domestic players like Didi
Chuxing, rendering foreign entry a challenging competitive environment.
Question 3: Evaluate the advantages China can offer Uber in terms of its investment in
China. Supply FOUR instances for each type of advantage from the case study
to further develop arguments made. (10)
China could potentially have offered Uber several potential advantages:
Market Size and Growth Potential:
Colossal Population: China has the world's largest
population, which represents a huge prospective base of customers for ride-hailing.
Rapid Urbanization: China's urbanization process led to an increasing demand
for city transport solutions.
Rising Middle Class: A growing middle class with increasing disposable incomes could afford
and choose convenient transport like Uber.
High Mobile Adoption: High mobile phone and internet
