What Is a Middle-Market Firm?

The internal market is also called the domestic market. The stock exchange market refers to the market where securities issuers are registered and traded in their home countries, while the foreign stock exchange market refers to the market where foreign issuers issue securities to trade in their home countries. The issuance of foreign securities must comply with the laws and regulations of the country where it is issued. For example, non-US companies issuing bonds in the United States must comply with US laws, and non-Japanese companies issuing bonds in Japan must comply with Japanese laws. Different foreign stock exchange markets have different nicknames. For example, the foreign stock exchange market in the United States is called the Yankee Market, the foreign stock exchange market in Japan is called the Moto market, the foreign stock exchange market in the United Kingdom is called the Mastiff market, and the Dutch The foreign stock exchange market is called the Rembrandt Market. ^[1]

Internal market

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The internal market is also called the domestic market. The stock exchange market refers to the market where securities issuers are registered and traded in their home countries, while the foreign stock exchange market refers to the market where foreign issuers issue securities to trade in their home countries. The issuance of foreign securities must comply with the laws and regulations of the country where it is issued. For example, non-US companies issuing bonds in the United States must comply with US laws, and non-Japanese companies issuing bonds in Japan must comply with Japanese laws. Different foreign stock exchange markets have different nicknames. For example, the foreign stock exchange market in the United States is called the Yankee Market, the foreign stock exchange market in Japan is called the Moto market, the foreign stock exchange market in the United Kingdom is called the Mastiff market, and the Dutch The foreign stock exchange market is called the Rembrandt Market. ^[1]

The internal market is the artificial division of the public sector that provides public services into producers and consumers, or "public-to-public competition". This creates the role of "producer" and "consumer" within government organizations. Or promote competition among internal organizations to improve the quality of services. The internal market is a mode of narrow application in the market model. It is used more in European countries such as the United Kingdom, New Zealand, Sweden, and less in North America (mainly the United States and Canada). Peters believes that this is because in these countries "very few services are provided directly by the government, especially the federal government."

Main work content:

(1) Learn external experience, summarize and promote internal models, establish pilot units, and start later.

(2) Implement division of labor, set up various professional measurement and basic working groups, and clarify responsibilities, rewards and penalties.

(3) Establish and improve the main body of the internal market, and build a three-tier market system of mines, district teams and teams.

If different classification standards are used, there are many ways to divide the internal market structure types. In order to facilitate subsequent research, the classification criteria used should meet at least the following two basic conditions at the same time: first, it can reflect the main characteristics of the internal market of the enterprise; second, the type of internal market structure of the enterprise divided by this standard Has better stability. Based on these two conditions for investigation and screening, it is not difficult to find that the competition and cooperation between the main players in the internal market of the enterprise are ideal choices.

The specific method of using this criterion to classify the type of internal market structure of the enterprise is to take the dimensions of the importance of cooperation and competition among the internal market entities of the enterprise to the development of the enterprise, and divide each dimension into high (important) and low ( Not important) two states, which divides the company's internal market into four types of structure: simple, cooperation-oriented, competition-oriented, and composite.

(1) Simple internal market

In the simple internal market, the cooperation and competition between internal market entities are irrelevant to the development of the company. The main reason is that the content of transactions in the internal market is outside the main business value chain of the company. The simple internal market can be regarded as a free market within the enterprise, which exists in large numbers in reality. It may or may not have a corresponding external market. A typical example of a simple internal market is the internal market established by BP to trade greenhouse gas emissions credits across divisions. In 1998, BP solemnly promised the society that its greenhouse gas emissions in 2010 would be 10% lower than in 1990. Based on this goal, BP calculates the total amount of greenhouse gas emissions in each year and decomposes the total indicator into the emission quota indicators of each business unit; then it allows the business units with surplus balances and those with tight quotas to allow Transaction with each other to form a greenhouse gas emission trading market within the enterprise. According to data released by BP, in 2001 alone, 4.5 million tons of greenhouse gas emission quotas were transacted between various business units at a price of US $ 40 per ton. BP leveraged the price mechanism to coordinate the efforts of various business units to reduce greenhouse gas emissions, which not only met the company's expected goal, but also reduced the difficulty of achieving this goal, thereby improving the efficiency of internal resource allocation.

(2) Cooperation-led internal market

In the cooperative-dominant internal market, the cooperation between internal market entities is crucial to enterprise development, while competition is irrelevant or even harmful to enterprise development. Intermediate products or services traded on such structured internal markets either do not exist in the external market, or although there are external markets, the company s differentiated competitive strategy or asset-specific characteristics (such as location-specificity) require that the internal market must match the external market Phase isolation. Among them, the most representative is the internal market formed by Handan Steel's "simulated market accounting, cost veto". In order to get rid of the predicament, Handan Iron & Steel started to use the simulation method to introduce the market mechanism into the enterprise from 1991. However, Handan Iron & Steel's internal market is based on the premise of "maintaining the advantages of professionalization of modern industrial enterprises, scientific division of labor and cooperation, and highly centralized and unified management." Cooperation between internal market entities has been highly valued. For this reason, Handan Iron & Steel has implemented stricter controls on trading partners, number of transactions and transaction prices in the internal market. Due to the remarkable achievements made by Hansteel through the innovation of the internal market, it brought hope for the state-owned enterprises at the stage of reform and tackling difficulties at the time to get rid of the predicament. In the mid-to-late 1990s, a wave of corporate learning of Hansteel was set off.

(3) Competition-led internal market

In the competition-oriented internal market, competition among internal market players is very important for enterprise development, improving performance, and increasing the competitiveness of the final product, while the importance of cooperation is relatively low. The internal market of such a structure may emerge for a variety of reasons. First, companies that implement cost-leading competition strategies often give relevant departments the autonomy to purchase intermediate products or services. If the internal price of an intermediate product or service is higher than the external market price, these departments have the right to abandon internal and external requirements. In order to ensure internal sales, the upstream department had to compete with external competitors to form a competitive-dominant internal market. The internal market established by JAC Power Co., Ltd. belongs to this type; Hitachi has also used this type of internal market and achieved good results. Second, in some enterprises, although there is no direct connection between the various departments, there is competition in internal resources or customer allocation, thus forming a competition-led internal market, such as the internal capital market of non-relevant diversified companies. . For another example, in order to reduce customer service complaints, American Forest established an internal market, allowing customers to choose between the two customer service centers to which they belong. Through the direct competition between the two centers, customer satisfaction with after-sales service is greatly improved.

(IV) Compound internal market

In the compound internal market, the cooperation and competition between the internal market entities are very important to the development of the enterprise. The competitive orientation of the internal market entities' behavior is a prominent feature of this type of internal market. The internal market formed by Haier through business process reengineering based on the market chain belongs to this type of structure. On the one hand, through business process reengineering, Haier separated the financial, procurement, and sales functional activities that were originally part of each product division, and integrated them into business flow promotion, logistics promotion, and capital flow promotion, etc. The degree of centralization in the decision-making of these functional activities is aimed at strengthening resource sharing and cooperation based on the various product divisions; on the other hand, by establishing a debt management mechanism, Haier has adopted a "market-oriented" process and positions The performance appraisal and value distribution mechanism has promoted competition between processes and positions. For Haier, the competition and cooperation between the main players in the internal market must be established in order to enable enterprises to overcome the "big enterprise disease" and achieve the strategic goal of international development.

It must be emphasized that the internal market structure defined in this article belongs to the behavior structure and is different from the concept of the external market structure. On the surface, dividing the external market into four types of structural types: perfect competition, monopolistic competition, oligopoly, and complete monopoly is also the behavior of market entitiesthe degree of competition. However, because the degree of competition between firms in the external market depends on the number of firms producing the same product, the external market structure is essentially a quantitative structure, not a simple behavioral structure.