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MGMT2341 > 7. Strategy Implementation > Flashcards

7. Strategy Implementation Flashcards

1
Q

tech resources

A

proprietary information, IP protections, etc

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2
Q

mission and objectives includes

A

aspirational element

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3
Q

RBV to capabilities

A

linear relation, identify core competencies from capabilities

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4
Q

strategic

A

C-suite, organisation-wide

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5
Q
  1. decide on strategy
A

strategic choice of strategy/ies depends on:
- evaluation of dis/advantages in relation to firm capabilities and resources: what are you doing, why are you doing it, what is the best way to get in
- environmental factors
- contribution of choices to mission and objectives of company

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6
Q

value chain in a manufacturing firm - evaluation

A
  • linearity helps avoid problems
  • in-house vs out-house
  • 2 Q’s or considerations; make or buy?
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7
Q

value chain activities

A
  • primary activities
  • supporting activities
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8
Q

VC - primary activities

A
  • R&D: the idea
  • Inbound logistics: inputs
  • Production: inputs, transformation, outputs
  • Outbound logistics: output to customer (delivery)
  • Marketing and sales
  • After-sales service
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9
Q

VC - supporting activities

A
  • firm infrastructure
  • HRM
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10
Q

VC - value added

A

what customers are willing to pay for firm products

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11
Q

PV - outsourcing

A

out-of-house process of production looks at Q to make or buy?

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12
Q

factors affecting choice of internal entry strategy

A
  • internal factors (long-term strategy, global objectives, financial assets)
  • external factors (5P, barriers, country risks)
  • venture-specific factors (firm value, intent to conduct R&D, size of planned foreign venture)
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13
Q

entry strategy alternatives

A

(ascending commitment and risk)
- exporting
- licensing
- franchising
- contract manufacturing
- turnkey operations
- management contracts
- international JVs
- wholly owned subsidiaries

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14
Q

entry strategies analysis - exporting

A

low risk, no long-term assets, easy market access and exit however success depends on choice of distributor, transportation costs, tariffs and quotas

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15
Q

entry strategies analysis - licensing

A

no asset ownership risk, fast market access and avoids regulations and tariffs, however success depends on quality and trustworthiness of licensee, transferability of IP and host-country royalty limits.

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16
Q

entry strategy analysis - franchising

A

little investment or risk, fast market access and small business expansion, however success depends on quality control of franchisee and franchise operations.

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17
Q

license

A

giving rights to someone to use your trademarks, products, marketing, etc, with limited control and for a fee.

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18
Q

franchise

A

giving rights to someone to operate under your brand and business model, with more control and influence over the operations.

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19
Q

entry strategy analysis - contract manufacturing (outsourcing)

A

limited costs and risks and short-term commitment, however success depends on reliability and quality of local contractor, operational control and human rights issues. There exists a risk regarding the quality of the output, which is possible to mitigate.

20
Q

entry strategy analysis - turnkey operations (big projects)

A

revenue from skills and technology where FDI is restricted, however success depends on reliable infrastructure, sufficient local supplies and labor, repatriable profits and reliability of any gov partner.

21
Q

entry strategy analysis - management contracts (contracts to manage operations)

A

low-risk access to further strategies, however success depends on opportunity to gain longer-term position.

22
Q

entry strategy analysis - joint venture

A

insider access to markets, share costs and risk of production, and leverage partner’s skill base, technology and local contacts, however success depends on strategic fit and complementarity of partner, markets and products, the ability to protect technology, existing competitive advantage, ability to share control and cultural adaptability of partners.

23
Q

entry strategy analysis - wholly owned subsidiaries (mini version of HQ in another country - maintain control of quality and IP)

A

realise all revenues and control, global economies of scale, strategic coordination, protect technology and skill base, acquisition provides rapid entry into established market, however success depends on the ability to access and control economic, political and currency risk, ability to get local acceptance and the repatriation of profits.

24
Q

cooperative strategies analysis - strategic alliances

A

a partnership between two or more firms that combine financial, managerial and technological resources and their distinctive competitive advantages to pursue mutual goals. Critical because most alliances fail because of bad partner selection.

25
strategic alliances - categories
- JV: Starbucks x Tata Global beverages 50/50 ownership (USA and India) - Equity strategic alliances: Daiichi-Sankyo owning 51% in Ranbaxy (Japand and India) - Non-equity strategic alliances: UPS and Nike - Global strategic alliances
26
Joint venture
JV is two or more companies creating a new, separate legal entity where they share ownership and control over operations.
27
equity strategic alliance
ESA is one company acquiring equity (ownership stake) in another without necessarily forming a new entity, which allows the investing company to influence the other's operations.
28
Non-equity strategic alliance
two companies contracting to pool resources, decision-making and core capabilities without creating a separate legal entity and no equity-sharing (ownership stake) is part of the agreement.
29
global strategic alliance
two or more businesses partnering to collaborate on a specific project or goal for mutual benefit, neither company loses their authority or control or has an advantage over the other.
30
global alliances - motivations and benefits
- avoid trade barriers, licensing requirements and protectionist legislation - share costs of R&D of new products and processes - gain access to specific markets where regulations favour domestic companies - reduce political risk while entering new market - gain rapid entry into new/consolidating industry and take advantage of benefits from companies' cooperation - alliances are faster and less risky route to globalisation
31
global alliances - challenges in implementation
- shared ownership disputes - differences in national cultures - integration of vastly different structures - conflicts in decision making and control - choosing the right form of governance - benefits of cooperation vs dangers of new competition - JV: companies need to establish who is in charge of what specifics - visibility challenge: how an uneven split of responsibility (eg. 60/40) could look like one company is in control when that is not the case
32
dual role of strategic alliances
- cooperative - competitive
33
strategic alliances - cooperative role
- leverage complementary skills of each partner - acquire local/international regulatory and market knowledge - develop linkages with major buyers/suppliers - develop International experience with other MNEs in order to springboard onto global stage; local domestic procedures get exposure - compensate for competitive and latecomer disadvantages
34
strategic alliances - competitive role
- prevent technological and learning by partners vis-a-vis outsourcing agreements - provide a platform to transform mature industries - create new growth opportunities - building potential competitor that started as partner
35
guidelines for successful alliances
- partner choice: choose a partner with compatible strategic goals and objectives (same or separate expertise) - complementary: seek complementary skills, products and markets - privacy: work out how each partner will deal with proprietary knowledge or competitively sensitive information - timeframe: recognise that most alliances only last a few years * trust is also really important but should be backed up by contract
36
strategic implementation
putting decisions about global alliances and entry strategies into action
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successful implementation requires
- creating a system of fits - resources must be allocated appropriately - leadership is the key **critical**
38
strategic implementation - mcdonalds
- main source of revenue is rent - standardisation is widespread; all managers must go to 'Hamburger Uni' - form pattern-breaking arrangements with suppliers - hire locals whenever possible - localisation strategy: implement local cultures and tastes into local product line by tweaking menu slightly (maintain overall or umbrella standardisation) - low pricing to build market share, profits follow when economies of scale occur - maximise autonomy
39
implementing global outsourcing strategy
- examine reasons for outsourcing - evaluate best outsourcing model - gain cooperation of management and staff - consult alliance partners - invest in alliance (time, money, communication structures, etc) ** best managers are the best communicators - #1 issue
40
managing performance - international JVs
- IJV control: ensures the way a JV is managed conforms to the parent company's interests - Choice of partner - Organisational design: structure, organisational design; the strategic freedom in choosing suppliers, product lines, customers, etc
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3 complementary dimensions of IJV organisational control (3 areas parent companies focus on)
1. scope of activities and control (areas/aspects of IJV parent companies focus on controlling) 2. extent/degree of control (what decisions the parent company can make over IJV) 3. mechanism of control (tools and methods they use to control the IJV)
42
trends - international strategy
- companies moving from outsourcing to nearshoring - nearshoring moves manufacturing and service operations to closer geographic regions and markets - reshoring to home country - increasing labor costs and risks of supply chains and transportation make offshoring less competitive - next-shoring: trend towards robotics to digitalise operations
43
knowledge management in IJVs
1. make implicit knowledge explicit 2. knowledge management model (parent companies transfer knowledge between them and with the IJV who transforms the knowledge which is then harvested from it by the parent companies; ongoing loop) ** important because if companies don't utilise knowledge then what is the point
44
government influences on strategic implementation
- profitability impacted by taxation and restrictions on repatriation - unpredictable changes in governmental regulations - government restrictions have relaxed and allowed more foreign ownership over the years
45
cultural differences in UK-European alliances
1. organisational formality 2. participation in decision making 3. attitudes toward risk - risk taker vs risk averse 4. systemisation of decision making 5. managerial self-reliance 6. attitudes toward funding and gearing (financial leveraging)
46
e-commerce and strategic implementation
- paves the way for smaller firms to get access to larger international markets - outsourcing is a necessary task to e-commerce enablers - helps companies sort through difficult taxes, duties, language translations, etc. - small and medium sized companies go global with no internal capabilities to carry out global e-commerce functions

MGMT2341 (7 decks)

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