Lecture Flashcards
Why should a company internationalize?
Economic benefit and increase margings & profit
What is international business?
- conducted across boarders
- Uses distinctive methods
- In contact with countries that differ, ex in culture
Risks of internationalize?
- Cross cultural risks (between employees)
- currency risks
- country risks ex laws
- commercial risks
What is happening in the world right now? lecture 1
inflation is rising
Människor blir mer höger i politiken
Measurement of global economy?
Gross Domestic Product (GDP)
GDP definition
market value of total output of goods & services in a country
(does not take in quality of life)
Gross National Index (GNI)
GDP + net reciepts from abroad
Global inequality, what is happening right now?
Positive: more people are getting out of poverty, the middle class is growing
Negative: The gap between rich and poor is increasing, rich getting richer
Globalisation
Merges societies, knowledge and goods
Role of the state
Good governance is needed for economic development
How is governance measured?
- Voice and Accounability
- Political stability & absence of violance
- Government effectiveness
- Regulatory quality
- Rule of Law
- Control of corruption
4 political systems
Autoritarian regimes
Hybrid regimes
Flawed democracies
Full democracies
2 key countries for tech advancement
USA & Japan
Comparative advantage
Reduces cost but still manages to keep up with quality of competitors
–> this drives international trade (produce in ex china)
Why invest in tech, R&D and innovation?
Business opportunities
Higher productivity
better competiveness
Digitization and digitalization definitions:
Digitization: Making things digital
Digitalization: transforming processes (ex netflix with film industry)
Culture definition
Emotional features of a soceity
Universalization definition:
More and more events are on global scale
–> creates global culutre
–> people around the world are becoming more alike
Cultural hybridizations
Mixing of cultures
Ex mcdonalds in japan, anpassar sig lite
Cultural differentations
Lookin below surface
–> we can see differences
Cultural fractionalization
Globalization has overwhelmed us
–> want to reutnr to social micro groups
We build communities over internet
–> niche
Sustainable competative advantage
Flexability -> adapt when necessary
Learning -> willing to learn from other
Efficiency -> being efficient with what u have
International strategy:
y-axeln: ?
X-axeln:?
Y: global intergration low and high
x: pressure of local responsiveness
4 strategies when going international
Global strategy
Transnational
International strategy
Localization strategy
International strategy
low competition markets
markets are similar
Localization strategy
customising goods
polycentric focus = focus on local
Global strategy
world is seen as a single market
focus on global values
Transnational strategy
coordination abroad
3 opportunity assesments
Motiviation check
Readiness check
Market selection and entry check
Motivation check
Drivers
Benefits
synergies
Readiness check
Company readiness
Product readiness
market readiness
Market selection and entry check
Target
Pacing
Scale
Exporting positive & negative
+ No investment overseas
+ Minimize risk
+ fast entry
- More tariffs & transportation costs
- logistical difficulties
- limited acces to local info
Contractual modes
Licensing and Franschasing
Licensing positive and negative
+ little upfront capital
- loss of control
Franchasing
Operate busniess under name (KFC, McDonals)
+ low risk
+New markets quickly
- lack of control
- cost on brand
joint ventures
+ share knowledge
+ local market knowledge
- lose control
- different goals
2 hierarchical modes
M&A and own subsidiary
M&A
+Less time consuming
-costly
-need banks and lawyers to complete process
Own subsidiary
+ all control
- costly
- slow to establish
Direct communication
Responsebility of communicatior to be clear
