Strategies For International Competition - GlobalOperations
Strategies For International Competition - GlobalOperations
Competition
By
DeepaChandrasekar
[email protected]
The Roots of International Strategy
• The three states of mind or attitudes that are
inferred from the managerial practices:
• Ethnocentrism
• Polycentrism
• Geocentrism
Ethnocentrism
• Strategic decisions are
made at headquarters;
• Limited subsidiary
autonomy;
• Key positions in domestic Ethnocentric
Firm
Government &
Political
Forces
Competitive Technological
Forces Internationalization Forces
Market
Forces
Facilitators
• Market Saturation
• Political Reasons
• Cheap Labor.
• Availability of resources
• Technological advancements
• Economies of scale and scope
• Competitive Pressure
Where to Expand Internationally
• Rating factors to evaluate where to expand
• Political Risk
• Cultural Distance
• Geographic Distance
• Economic Environment
• Foreign Exchange Volatility
• Market Size
• Market Growth
• Regulatory Environment
• Firms may then derive
• Measure of country risk from these ratings
• Measure of expected return
Strategic Planning For Foreign Market Entry
1. Identify the company’s objective in its Foreign Market Entry.
2. Preliminary Country Screening
3. What are the Opportunities and Constraints in the Target Market?
4. What Capabilities, Resources, and Skills are needed to succeed in
the Foreign Market?
5. Does the company have the Core Capabilities and Resources to
Score High on the key Success Factors? What are our Strengths and
Weakness on the Key Success Factors?
6. Should the company Enter the target Market, and How?
7. Compare and Rank the Targeted Countries.
Identify the company’s objective in its
Foreign Market Entry.
• Management should be clearly understand the objective
for entering the foreign market
• Cheap Labor.
• Availability of resources
• Technological advancements
• Economies of scale and scope
• Competitive Pressure
• Reduce the Risk
Managing Portfolio Of Country Subsidiaries
High
Collaborative Growth
Strategies Strategies
Host
Country
Attractiveness
Cross-
Defensive
Subsidization
Strategies
Strategies
Low
Low High
High
Increase
Resources
Harvest & Divest to Match Risk
Or Licensing or International
Host Selectively Joint Venture
Cou Medium Grow
ntry
risk
Cross-Subsidize Grow Industry Leadership
Low
High
Low
Procurement
Eg., components, machinery, advertising, services
Inbound Operations
Logistics Outbound Marketing & After Sales
Eg. Component Logistics Sales Service
Incoming Fabrication, Eg. Order Eg., Sales
Material assembly Processing, force,
storage Branch warehousing promotion
operation
Primary Activities
Primary activities
• Primary activities are purchasing raw materials , transporting to
the factory , production , operations, marketing and sales.
• Ex : Inbound Logistics .,Incoming Material storage
• Operations Component Fabrication, assembly, Branch operation
• Outbound LogisticsEg. Order Processing, warehousing
• Marketing & SalesEg., Sales force, promotion
Supporting Activities in value chain
• Firm activities which are required to enhance the
efficiency and effectiveness of the primary activities are
known as support activities.
• Examples
• Firm Infrastructure
• Eg., Financing , Planning, investor relations
• Human Resources Management
• Eg., recruiting, training, compensation system
• Technology Development
• Eg., Product design, testing, process design, material & market
research
• Procurement Eg., components, machinery, advertising, services
Down Stream Activities
• Simple Integration
• Complex Integration
Stand alone integration
France –
VCR’s
Televisio
ns
Tape
Germany -
Recorders - Camcorders
Brazil
Simple Integration
• End Product
Core Competency - Canon
Imaging
• Imaging
Core Competency
Semiconductors & Digital Display
Counter Attack
Glocalization of Management
Glocalization of Exports
Glocalization of Prodcuts
Glocalization of Production
Glocalization of Management
• local favorites
• McItaly burger in
Italy,
• Maharaja Mac in
India,
• The McLobster in
Canada
• The Ebi Filit-O in
Japan.
Glocalization of Prodcuts
Thank You
Questions ????????