7. Internationlization Flashcards
What is International Strategy?
International strategy involves leveraging home country capabilities; innovations; and products in foreign markets to achieve growth and competitive advantage.
What are the drivers of internationalization?
The drivers of internationalization include market drivers (e.g.; similar customer needs); cost drivers (e.g.; economies of scale); government drivers (e.g.; trade policies); and competitive drivers (e.g.; global competitors).
What is an Export Strategy?
An export strategy leverages home country capabilities in foreign markets and is used when pressure for both global integration and local responsiveness is low.
What is a Multi-domestic Strategy?
A multi-domestic strategy maximizes local responsiveness with different product offerings for different countries and involves a low level of international coordination.
What is a Global Strategy?
A global strategy maximizes global integration with standardized products and services across all markets; emphasizing efficient production through economies of scale.
What is a Transnational Strategy?
A transnational strategy maximizes both local responsiveness and global coordination; aiming to maximize learning and knowledge exchange between dispersed units.
What are the key factors in Market Selection and Entry?
Key factors in market selection and entry include political (e.g.; political environments); economic (e.g.; GDP levels); social (e.g.; population characteristics); and legal (e.g.; legal regimes) considerations.
What are the modes of International Market Entry?
Modes of international market entry include exporting; licensing and franchising; joint ventures; and wholly owned subsidiaries.
What are the advantages and disadvantages of Exporting?
Advantages of exporting include no need for operational facilities in the host country and economies of scale. Disadvantages include loss of location advantages and exposure to trade barriers.
What are the advantages and disadvantages of Licensing and Franchising?
Advantages include contractual source of income and limited economic exposure. Disadvantages include difficulty in identifying good partners and loss of competitive advantage.
What are the advantages and disadvantages of Joint Ventures?
Advantages include shared investment risk and complementary resources. Disadvantages include difficulty in finding good partners and relationship management issues.
What are the advantages and disadvantages of Wholly Owned Subsidiaries?
Advantages include **full control **and possible rapid market entry through acquisitions. Disadvantages include substantial investment and commitment required.
What are the three waves of Globalization?
The three waves of globalization are the
* first wave (focus on volume and costs);
* second wave (focus on worldwide knowledge management);
* third wave (focus on innovation and balanced worldwide presence).
What are the benefits of Globalization for Industrialized Nations and Developing Countries?
Benefits for industrialized nations include new markets and economies of scale. Benefits for developing countries include transfer of technology and improved quality of life.
