International Strategy Flashcards
1
Q
List advantages of international strategy
A
- Market size
- Return on Investment
- IP (because of weak patent protection in some countries)
- Scale and scope economies (firms have access to larger and more diverse markets)
- Innovation
- Value chain (placing activities in the most optimal locations)
- Location advantages (benefits
- Regionalization
2
Q
Define Porter’s Diamond
A
Determinants in firms’ home markets that provide advantages in foreign markets. These conditions are interrelated.
- Factors of production: Inputs needed to compete
- Demand conditions: the nature and size of home-markets buyers’ needs for the industry’s products/services
- Related and supporting industries: groups of firms that provide support services, facilities, supplies, etc.
- Firm strategy, structure, and rivalry: Firms’ patterns of competition and organization of the home market
3
Q
List Generic International Strategies
A
- Multi-domestic: tailoring products/services to local markets (decentralized decisions, independent BUs, compete in each market individually)
- Global: standardizing products and services across local markets (centralized decisions, interdependent BUs, resource sharing)
- Transnational: pursuing attributes of both (difficult to implement)
4
Q
Define Exporting and Licensing Entry Modes
A
- Exporting: Producing in one market and selling in another
- Licensing: allowing other firms to manufacture, provide, or improve upon the firm’s products, services, technology, etc.
5
Q
Define Alliance Entry Mode
A
Partnering and collaborating with other firms
6
Q
Define M&As Entry Mode
A
Combine with another firm to form a single entity
7
Q
Define Wholly-owned subsidiaries entry mode
A
stand-alone facilities; established without investment from outside firms
8
Q
List Challenges of International Strategy
A
- Liability of foreignness
- Coordination challenges
- Complexity
- Institutions
- Possible S-Shaped relationship (depending on levels)
9
Q
A
