Chapter 13: The Strategy of International Business Flashcards
capability
a special type of resource that improves the productivity of a firm’s related resources
concentrated configuration
when some activity of the value chain is performed in one geographic location and serves the world from it
configuration
the set up of value activities to ideal locations around the world so the company can start and sustain operations
core competency
A special outlook, skill, capability, or technology that runs through the firm’s operations, weaving together disparate value activities into an integrated value chain; managers bundle resources and capabilities to create a core competency
dispersed configuration
a value chain where a particular activity is performed in many geographic locations and serves the world market from any to all of its units
Economies of scale
The lowering of cost per unit as output increases because of allocation of fixed costs over more units produced
global integration
Integration into one global market of distinct national economic systems
Global Strategy
A strategy that increases profitability by achieving cost reductions from experience curves and location economies
Great by Choice
managers’ choices are the basis of building and sustaining a high-performance enterprise in unpredictable, tumultuous, and fast-moving times
Industry Structure
the makeup of an industry: its number of sellers and their size distribution, the nature of the product, and the extent of barriers to entry
Integration Responsiveness (IR) Grid
schema that helps managers measure the global and local pressures on the operations of value chains
International Strategy
creating value by transferring core competencies from the home market to foreign markets where local competitors lack those competencies
liability of foreignness
foreign companies’ lower survival rate in comparison to local companies in the long-run
Location Advantages/Economies
cost advantages from performing a value activity in the optimal location
Localization Strategy
responding to unique conditions in different national markets
mission
statement that defines the business, its objectives, and its approach to achieve them
primary activities
The line activities that compose the value chain. Specifically, inbound logistics, operations, outbound logistics, marketing, and service.
Resources
Inputs, owned or controlled by the MNE, that supports its production process
strategy
set of commitments that reflects the company’s present situation, identifies the direction it should go, and determines how it will get there.
Support Strategies
general infrastructure of a firm that anchors the day-to-day execution of primary activities of the value chain
Transnational Strategy
configuring a value chain to exploit location economies and coordinate activities to leverage core competencies while responding to local pressures
Value
a measure of a firm’s ability to sell what it makes for more the costs incurred to make it; the ultimate purpose of strategy
vision
The idealization of what an MNE firms wants to be. It expresses, in broad terms, its ultimate goal
