Global Strategy And Structure

Question 1

What is international / global strategy?

Answer 1

Setting up a series of action or activities to achieve worldwide company goals
Goal of profit maximization
Creating profit requires creating consumer value

Question 2

What are some generic competitive strategies

Answer 2

Cost leadership
Differentiation strategy
Focus niche
Blue ocean strategy

Question 3

What is consumer value?

Answer 3

When the benefits outweighs the cost

Question 4

What are three major strategic options for companies to change?

Answer 4

Redesigning Value chain
Reinventing the consumer value proposition
Ré defining the customer segment

Question 5

What are the global strategies for firms to operate

Answer 5

Global strategy
- value chain activities are located in countries with the highest comparative advantage

Transnational strategy
- value chain activities mostly located in host country and some are sourced form other subsidiary of MNE global operations

International strategy
- most value chain activities are located in home country

Multi-domestic strategy
- most value chain activities are located in host country

Question 6

What is the global strategy formulation process

Answer 6

1. Global vision/mission/goal
2. SWOT analysis
3. Analyse global strategic options
4. Design of international organizational structure
5. International market selection and entry

Question 7

What is the global vision or mission

Answer 7

Purpose/motive of global operations
Objectives and goals

Question 8

What can the swot analysis can help identify

Answer 8

External environment
- opportunities and threats

Internal environment
-resources, capabilities, and weaknesses

Question 9

What is the PEST analysis for external environment

Answer 9

Analysis of:
Political environment
Legal environment
Economic environment
Cultural environment
Technological environment

Question 10

The industry analysis targets what elements of the external environment?

Answer 10

Entry barriers
Access and quality of supplier
Competition
Market size and buyer sophistication
Accumulated knowledge

Question 11

What is the strategy and framework of a MNE

Answer 11

International value chain configuration + international organizational structure -> international/global strategy

Question 12

What is international organizational structure

Answer 12

An organizational structure defines how activities such as task allocation, coordination, and supervision are directed toward the achievement of organizational aim
Must evolve to accommodate internalization
Should be contingency based
Must “fit” with strategy

Question 13

What is the most complex geographic structure?

Answer 13

Matrix

Question 14

What do the transnational corporation and network structure enables MNE to do?

Answer 14

Utilize its capabilities and resources
Achieve economies of scale of a global corporation
Achieve local responsiveness of a domestic company
Transfer technology and knowledge across international operations

Question 15

What are some control and coordination mechanism of international organizations

Answer 15

Direct coordinating mechanism
- design of appropriate structures
- use of effective staffing practices such as use of expatriates in subsidiary
- vertical intergration of subsidiary with HQ
Periodic head quarter visits to subsidiaries

Indirect coordinating mechanism
- financial statement

Sales quotas , budgets, and reports

Question 16

What does the configuration of the value chain do

Answer 16

Decides which value chain activities to conduct internally offshore and which ones to outsource to external partners
Decide how to transfer organizational capabilities to offshore facilities
Decide how much authority to centralize at headquarters and how much to delegate to subsidiaries
Decide upon coordination acros subsidiary and hq as well as subsidiary to other subsidiaries
Provide necessary collaboration/intergration across subsidiaries and input suppliers

Question 17

What does outsourcing internal operations do

Answer 17

Cost reduction
Take advantage of suppliers competence
Improve innovative capacity
Can concentrate on company’s inique competence
Highly flexible and open to change
Less resource commitment
Loss of control
Risk of losing core competence to supplier
Can be vulnerable to supplier dependency and increase supplier bargaining power

Question 18

What does the offshoring of internal operations do?

Answer 18

Greater control
Less risk of losing core competence
Less dependent/ vulnerable to supplier bargaining power
High resource commitment
Economies of scale
Less flexible

Question 19

How can one manage an effective monitoring system

Answer 19

Extensive communication between hq and subsidiaries
Reporting systems
Evaluation variables across countries
Use of information system for prompt accurate and continuous feedback

Question 20

What are the entry strategy/organizational structure/international-global strategy matrix

Answer 20

Exports -> domestic with foreign department-> international strategy
Contractual arrangement -> international division -> international strategy
Joint ventures and strategic alliances -> global network structure -> transnational strategy
Green-field -> global product structure-> global strategy
Acquisition -> world wide geographic structure -> multi-domestic strategy

Question 21

What did industry 4.0 impact on the firm’s global strategy and structure

Answer 21

Strategy
Structure
Business model
Value proposition
Market selection
Value chain

Question 22

What elements of industry 4.0 had an impact on a firm’s global structure

Answer 22

Internet of things
Ai and data analytics
Robotics and drones
Additive manufacturing
Cloud computing
Block chain