De Dietrich: Globalisation of a family business

• Main Authors: TAN, Hwee Hoon, RAO-KACHROO, Mahima
• Format: text
• Language: English
• Published: Institutional Knowledge at Singapore Management University 2024
• Subjects: Business expansion; Family businesses; product differentiations; global strategy; growth strategy; pharmaceuticals; internationalisation; Entrepreneurial and Small Business Operations; Pharmacy and Pharmaceutical Sciences
• Online Access: https://ink.library.smu.edu.sg/cases_coll_all/500; https://cmp-shop.smu.edu.sg/products/de-dietrich-globalisation-of-a-family-business?variant=42003487293482
• Institution: Singapore Management University

De Dietrich Process Systems (De Dietrich), a French pharmaceutical processing equipment company, was launched by the De Dietrich family whose business legacy could be traced as far back as 1591. The case discusses Marc-Antoine De Dietrich, chairman of the De Dietrich board, and his team’s challenges as De Dietrich expanded its pharmaceutical processing equipment business in Asia. An essential part of the global healthcare system, the pharmaceutical processing industry comprised private and public entities that processed pharmacological drugs at an industrial scale. Given the delicate and often-corrosive nature of such processes, De Dietrich built and sold pharmaceutical processing equipment that was coated with enamel—a chemical corrosion resistant substance. Demand for De Dietrich’s high quality, enamel-lined equipment grew. Over time, De Dietrich’s clients, the pharmaceutical companies, set up factories in China and India, and De Dietrich followed suit to cater to its clients more easily. Over the years, De Dietrich set up factories in South Korea, Singapore, Japan, China and India. When entering a new country, De Dietrich implemented various country-specific business strategies, with mixed results. Nevertheless, by 2023, the company had 20 subsidiaries around the world, including factories in the US and Asia, with China housing one of its largest industrial facilities. How could the company better navigate the cross-cultural differences in the Asian countries it had a presence in, to guide the its expansion plans? Which strategies could be considered when exploring new markets? The case teaches students about cross-cultural differences when setting up or expanding overseas businesses, and how using the Global Leadership and Organizational Behavior Effectiveness (GLOBE) framework can help assess cultural differences when entering new regions, the various motivations that drive internationalisation, the sources of competitive advantage, and the benefits and pitfalls of various entry strategies.