Best in France Case Study KDDI France Best in France Case Study May 2005 By: Mr. OIE,Ms. TROTIGNON, and Ms. WIBAUX

Best in France Case Study KDDI Corporation The biggest company in the international telecommunications market. The second biggest company in the mobile phone market in Japan.

Best in France Case Study Executive Overview A major international telecommunications operator. Who targets a niche : the Japanese in France. Why France ? A paradoxical profitability. Company values are customer-oriented. Expected constraints in France. The key to successful adaptation : flexibility. Essential Advice.

Best in France Case Study History 1975 KDD Paris - Just an office KDD France established L34-1 granted. KDD came to the market (first mover) KDDI Corporation was created – KDDI France : a subsidiary of the group.

Best in France Case Study A major international telecommunications operator. Telephony Data communication services & Internet provider Solutions provider A major investor in Intelsat and Inmarsat programs  Facility-Based business model.  Bargaining Power in the International Telecommunication Union Telecommunication Standardization Sector (ITU-T)

Best in France Case Study Main activity : Telephony

Best in France Case Study Surprising figures A very small company: –30 employees –KDDI Corp's subscription to KDDI France : euros (2003). Who targets a niche: –90% Japanese customers –But 60% of turnover comes from French customers

Best in France Case Study Why France ? Market Potential : Huge delay in Data services & solutions  First-mover advantage Upcoming standardization in mobile phone technology  Potential diversification

Best in France Case Study Who are the customers ? 90% Japanese Customers Quality of customer service –High reliability –Language –Famous among Japanese But 60% turnover is French –Companies VS residential customers –High value added services

Best in France Case Study A representative function Government’s initiative Paris : an economical and political center in Europe Presence in 46 other countries  Not selective : small investment in many countries

Best in France Case Study A customer-oriented policy Data services & Solutions: no standardization possible « French people are rough » –Delays –Not good at « selling » –Different ways to show respect Adapted to the Japanese customer’s needs

Best in France Case Study Company values Respect of the Japanese culture : –Deadlines –Pull strategy –Service to the Japanese living in France  A kind of embassy Adaptability to the market Reliability

Best in France Case Study M.Fukuma opinion: As expected constraints in France... Problems in business life: –Labour cost: Too many holidays Level of wages Low productivity –Working Habits: Delays in deadlines Reluctance to pay subcontractors –Infrastructures: Strikes in transportation Post service not reliable - Rules & regulation Working authorization Slow administrative procedures Unproductive civil servants

Best in France Case Study The key to successful adaptation :flexibility. Flexible human resources: A small organization : 30 workers. Adaptation to the level of activity : Ex : work on the weekends. 5 expatriates : less dependant of the headquarters. Recruitment: based on adaptability to Japanese culture. An horizontal structure.

Best in France Case Study Essential Advice Develop the Data & Solutions services. Go more towards French customers, who are very profitable. Expand the firm image as a leader in high- value-added technology.

Best in France Case Study We Thank M.Fukuma President of KDDI France For accepting to give us an interview and for the time he has spent answering our questions.

Best in France Case Study Bibliography MOCI Moniteur du Commerce International (Mars 1999 n°1380) S'internationaliser... face au défi de l'interculturel. Entreprises et télécommunications (Nov 1991 n°6) Les têtes de série japonaises : Sharp, Fujitsu, Nec, Ricoh. LSA Le Journal du grand commerce (Mars 2004 n° 1850) Les Japonais : des extrémistes de l’innovation.

Best in France Case Study Our Team Kosuke OIE Claire TROTIGNON Marguerite WIBAUX