1.3 Objectives of international firms

Question 1

What are the different objectives of an internationalization

Answer 1

• Resource seeking
• Market seeking
• Efficiency seeking
• Strategic Asset Seeking

Question 2

Resource seeking objectiveq

Answer 2

• Access resources at foreign market not available at home (ex natural resources)
• Access to cheaper resources abroad ex labor

Question 3

Market seeking

Answer 3

• Access to new markets with high volume or growth rates

- Establishing bridge heads (ex one market close to another)

Question 4

Efficiency seeking

Answer 4

• Ec of scale
• Ec of scope through synergies
• Risk diversification

Question 5

Strategic Asset Seeking

Answer 5

• Participant in foreign network

- Local presence at lead market (ex. Have R&D unit on sillicon valley)

Question 6

Objectives in reality

Answer 6

• Several objectives at the same time
• no objective more important than another (depend on type of company)
• objective change with time
• objective influence strategy, structure, sulture of firm