ENOVE: Business Strategy in a Transitioning Economy

In August 2014, La Société Energies Nouvelles & Environnement (ENOVE), a subdivision of Groupe Bismuth, was developing an expansion strategy in the unstable political and economic environment of Tunisia, the company’s home country. Tunisia was the birthplace of the Arab Spring, a series of political revolutions that started in 2010 and swept the Mediterranean region for five years. Tunisia was also quickly moving toward a democratically elected government, but the transition was not an easy one; the country experienced a setback of about 10 to 15 years, in regards to economic development. Years of functional corruption under the long-time president, Ben Ali, were followed by sustained economic growth in manufacturing, tourism, and education. This led the economy into a governmental vacuum. For the first time, workers began exercising their rights to demand better conditions. There was little governmental oversight on customs, labour, or taxation. The threat of terrorism, whether real or perceived, was always present. Under these conditions, ENOVE's president had to make a decision: Should ENOVE expand within Tunisia, or move their manufacturing operations to a more stable country, perhaps nearby Morocco?

This case is suitable for courses on business strategy formulation, geopolitical cooperation, economic stagnation, and political instability. After completing the case, students should be able to:<ul><li>Understand some of the many unique, and complex, challenges businesses face when operating, or choosing whether to operate, in an emerging market economy.</li><li>Evaluate the key issues associated with running an operation in a transitioning market.</li><li>Appreciate the issues facings the modern, global-centric business model.</ul></li>

• International business, strategy formulation, emerging economies, third world