Chapter 16 To Know Flashcards
Developing and selling products and services to all 7.6 billion people currently on the planet
Figuring out how to provide for the 9 billion by 2043
Global business bottom line
Globalization is both
Personal and corporate
The increased mobility of goods, services, labor, technology, capital throughout the world
The process of growing interdependence among elements of the global economy
Globalization
6 reasons to go global
New markets: customers/ profits Sourcing: suppliers of goods/ services Financing: capital to expand ops Labor: low cost and skilled Risk: business, natural, county Technology: communication, data
Major reason to go global
To increase earnings
Global strategic forms a business may take
Global (top left)
Transnational (top right)
International (low left)
Multinational (low right)
Integration responsiveness grid
X & Y (the two pressures)
Pressure for local responsiveness (x)
Pressure for global integration (y)
Being in every single town
Global integration
Adjustment of food mix/products for different countries
Local responsiveness
Invested and present in many countries
Coordinated brand image
Single corporate office strategy direction
Global
McDonalds ex
Focus on importing and exporting
Strategic direction from home county
Low to moderate investment outside of home country
International
Xerox and Ducati ex
Substantial investment in other countries
Focus on adapting products for local markets
Strategy is more home/host county directed
Multinational
Toyota example
Substantial investment globally
Decision making, R&D, marketing distributed locally
Competitors compete globally
Transnational
Nestle ex
Coca-Cola and PepsiCo
Ways to enter market from home country
Global sourcing
Exporting
Licensing
Franchising
Ways to enter market in host country
Joint ventures
Foreign subsidiaries
Importing is the first step
Get materials or services from around the world for local use
Global sourcing
Example of Global sourcing
Boeing 787 Dreamliner
Selling local (home) country products outside of the home country
Exporting
Example of exporting
Gulfstream G650: largest number of its planes sold elsewhere than the U.S
A form of business by which the owner (licensor) gives rights to s buyer (licensee) for specific uses of intangible or tangible property (a license)
Licensing
Renting or leasing an intangible or tangible asset
Global licensing
Ex of intangible licensing
Movie theatre renting an intangible movie
Example of tangible licensing
Disney rents or gives a license to a company to make tangible products such as figurines
A form of business by which the owner (franchiser) of a product, service or method obtains distribution through affiliated dealers (franchisees)
Franchising
Examples of franchising
Yum Brands a U.S company has three divisions: Pizza Hut, KFC, Taco Bell
Number one advantage of global franchising
Capital expansion
Examples of joint ventures
GM & SAIC
-selling in South America
Xerox and UAE
-service partnership
Examples of Subsidaries
ABInBev (Belgium Owned)
Smithfield (China Owned)
Firestone (Japanese Owned)
Ben and Jerry’s (England & Dutch)
