1 Flashcards
2x2 Firm size vs Domestic Market size (type of internationalizer)
Occasional Slow
Follower Enthusiastic
2x2 IR framework
Advantages/Forces for local responsiveness
Advantages/Forces for global
+ characteristics
Global Transational
International Multinational
Centralized/Scale Global efficiency+flexibilty
Centralize most Decentralized, self-sufcnt
valuable resources Entrepenurial
Export knowl/capab
The intensity of rivalry (2x2)
Based on (resource similarity, market commonality)
4th 3rd
2nd 1st
Top 3 hassle factors
Local Transport
Climate
Business Fascilitation
Institutions provide ___ and ___ for firms
Certainty Predictability
During institutional transition, what is very important
Informal Institutions
note - instituttions are socially constructed, and inform managerial decision making
Country attractivness is a multi-level concept
Supra-national - Global (bits/mits)
Macro-national - Country
Sub-national - City
What are the resources that are necessary for expansion?
- seperate into
- 3 types
- 4 types of drivers (motivation) for internationalization
What we have - What we need
Funding / People / Products
- Efficiency
- Resources
- Market
- Strategic-asset seeking
- Matching internal resources with customer needs in new market
How do we create value for these new dudes
Are our capabilities transferable? (im)perfectly?
Entry mode decisions follow a series of decisions, that have some inherent ordering, and involve different factors
but..
1st Order - Equity or non-equity, macro factors
2nd order - 4 types
Last order - Actual entry choice, driven by transaction cost entry
but…
should also focus on institutions and culture (all 3, not just TCE)
Brownfields - a type of acquisition …
Setting is emerging economies, emphasis on imperfect external and internal markets. 3Many issues:
Valuation
Negotiation
Enforcement
Brownfield/Greenfield/Conventional decision
External/Internal Preferance
Target have suffcnt resource/Project depend on resources not freely available
Conventional
Brownfield
Brownfield
Greenfield
Heirarchical model of choice of entry
Non Equity vs Equity
Export - Contractual Equity joint venture -WOS
Export (Direct,Indirect, Other)
Contractual (Lisensing, R&D contract, alliance, other)
EQJ - (minority, majority, 50/50)
Acq - (greenfield, acquisition, Other)
Specifics for the 4 types
Export (Low Risk/Low control/Low reward)
search cost/ monitor cost/ negotiation cost
Contractual Agreement
Lisencing - OMM asks OEM to manafacturer
R&D - learning & reciprocity
EQJ - sub 100%
WOS (High risk/ High control / High reward)
valuation cost / integration cost
Process theory / Stages model / Uppsala model
4 key parts
Butttttt -
International Expansion is Incrimental
Internationalization takes place AFTER home country
Low commitment first (left side) -> risk avoidance
Build gradual international experience
but -> GLobal new ventures also exist