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Lenhage AG is definitely European company and retailer of tools fasteners pertaining to the construction sector. Reigo Weinhardt is expatriates president and general supervisor in Seoul. South Korea construction market was thriving
Best opportunity was electrical power generation
Opportunity: Nuclear Power Technology Plants
South Korea is about to build 8 new nuclear power technology plants in sparsely filled southeast coastline of the region Coastal place was seismically active. New natural problems are fresh in householder’s mind So high quality products needed
Chun-Ha Construction is the main company for all of these kinds of projects Weinhardt and his administration team designed plan this past year to become essential supplier of safety anchors for these plants Failure of anchors and fasteners could possibly be catastrophic
Value of anchors is many millions of dollars
Competition
Only one rival in country
Competitor had not been manufacturer nevertheless distributor people made anchors.
Similar quality to Lenhage AG’s items. Competitor: no engineering or perhaps technical support personnel, no technical information, no quality testing/assrunace programs.
Competitor: put money into lavish entertainment, payment to purchasing and site managers to ensure that his product were used with couple of questions asked Personal relationship is vital for people who do buiness success
Kick-backs to brokers and decision makers were common with this industry and were done by mot neighborhood companies to obtain business. Weinhardt determined that. He recognized he had better products, better documentations, and better persons than his competitors. He felt business was rightfully his. Company actions
Full-time salesperson in charge of developing romance with all celebrations from personnel to mangers to web page engineers Sales engineers:
getting department in Chun-Ha Construction’s headquarters in which to stay touch and build relationship with all the key purchasing officials. Weihardt: entertaining Lee and other essential decision producers, to build trust and solid relationship. Documentations in Korean language.
Several thousand us dollars paid to local tests agency to acquire documentation
Many promises.
Local competitors could hardly provide assurances as Weihardt did.
The Problem
Rivalling dealer also met minimal standard pertaining to the task
Assessment data as well
Lenhage AG’s products were more expensive than those in the dealers Lee’s choice to choose either organization
Lee wants to get 1% with the value of every order in cash directly to his down-town office simply by Weinhardt.
Competitor would do it with no question.
Weinhardt’s response needed by Friday
Thoughts
1 .
Concerned about ALL OF US FCPA
Company had a published coverage against paying bribes
His supervisor in European countries won’t allow it
Legal or perhaps illegal
Lee is not a government official
A few level of aide payment is normal
Additional local suppliers would not wait
Local accounting standards: can establish product sales expense accounts that could be used for any purpose. Do not need to offer receipt or documentation to tax representatives or auditors Citizens may open bank account under a brand other than their particular. Could not always be traced straight to them. Dual standard ethic for home-based companies, but it might be looked at entirely differently if a foreign company made this payment Personal legal exposure, family
Blackmailing from employee, if he found out
Will Lee ask again?
Additional purchasing providers?
Business reputation
This individual deserved it and corporation had greatest products. He needed to win it. In the event he benefits contract, they can make close working relationship with lee’s company while others Financial accomplishment, Weihandt’s individual compensation and career
Lenhage AG’s worldwide image, global reputation
If perhaps lose contract: it will weaken his capability to lead in the foreseeable future 95% of workers had been Korean. If he get contract, staff will encounter great pride. It will generate great spirits and commitment to the organization
Decision
There were a couple of options. very first one is: pay the money and success. 2nd one is: No longer pay and lose complete last year operate. He had to take into account what legislation should be concerned? Risks, Who can be good advisor? Who would always be the best position to help him? Guide.
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