Key Success Factors of SME Internationalisation by Dominguez Noémie;Mayrhofer Ulrike;

Author:Dominguez, Noémie;Mayrhofer, Ulrike;
Language: eng
Format: epub
Publisher: Emerald Publishing Limited
Published: 2018-07-10T00:00:00+00:00

Fig. 7.1. Organisational Structure of SLAT. Source: SLAT (2016).

After having regained its independence, SLAT has enjoyed a period of strong growth and profitability. As André Guinet points out, a successful development plan entirely depends on a constant search for growth:

I need profitable growth. Why? The reason is quite simple. I always give this example. […] As a human being, try to remain standing for an hour without moving: it will be difficult. Try to walk backwards: you will not walk for long. Try going forward: you will be able to walk for miles. That is the image of growth that I always give. Given today’s economic system, you do not really have any other choice but to go forward! Going forward in business means finding growth. […] The problem of an SME is that I have an important amount of variable costs which become fixed costs. We need a basic infrastructure, and today, the strategy is relatively clear: we develop a profitable growth strategy. I need a certain form of comfort, I need a cash-flow to work and results that are not ‘border-line’: if you take out 2–3% of results in a company like this one, one coughing client who forgets to pay you puts you into losses. I rather follow objectives between 10 and 15%, not to take the money to the bank, but to invest it internally, to improve our competitiveness and to finance our export strategy.

Since its creation, SLAT has operated in niche markets, thus working in areas where competition in France, and even in Europe, appears to be weak. Today, the company designs, produces and sells secure power supplies. The offer is aimed at five different markets: (1) personal safety (54% of total sales), (2) security of property and premises (17%), (3) security for urban video surveillance (6%), (4) industrial automation (13%), and (5) telecommunications (10%). Personal safety (fire prevention and health) and the protection of property and premises represent the company’s main fields of activity. Standards in both areas are strict and constantly evolving. Security for urban video surveillance is a line of business which was introduced in 2010. The company’s industrial automation devices mainly serve the aerospace industry, airports and car manufacturers. The telecommunications sector, which constitutes the company’s historic line of business, is a declining market.

Concerning the reorientation of business activities accomplished since his arrival as head of the company, André Guinet states:

We have lost the telecoms business. In the past, it represented over 50% of the company’s business, but today I would say that it is less than 10%. […] Since 2004, I have completely redirected the company as I soon realised after I arrived that the telecoms sector was a little ‘dead’. Today, it is essentially a mass market served by South-East Asian suppliers. I decided to turn our attention to niche markets in which we can always offer something different and, above all, be a profitable company. […] The company’s areas of growth are very simple: they are linked to buoyant markets.

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