New Directions Flashcards
IB (Trade/globalisation)
important for NZ and the world, but regulation inevitable & is free trade always good (ethics/localisation)?
Triad dominate trade & investment, but…
world order changing due to 1) Shifting balance of economic power
2) Trade liberalisation
3) Technology
4) Growth of SMEs. But now FRAGMENTATION due to trade wars, Ukraine War, Brexit & COVID-19
MNEs hq’d in one country, operations in many;
environment-responsive; common resource pool, vision & multiple stakeholders; but regional, & emerging country challengers
Traditional internationalisation process:
License, export (agent), sales subsidiary, local packaging/assembly, FDI (Uppsala Model)
Strategy process: Formulation
– Mission; External OT analysis (industry experts; trends; scenarios; simulations: 5 Forces); Internal SW (resources, competencies: Generic Strategies); Objectives & plan); Implementation; Evaluation & Control
FSAs (ownership) & CSAs (location)
main building blocks for international competitive advantage: FSA-CSA Matrix; plus Internalisation Advantages (internal v. outsourcing)
Political ideologies & economic systems interwoven:
Change from totalitarianism/ central planned to democracies/market-driven or mixed; but privatisation v. nationalisation struggles, strong government intervention; rise of authoritarianism
Growing integration within different levels of trading blocs;
but ethical concerns; MNEs’ responding via integration (alliances, acquisitions) v. localisation; disintegration?
Culture central
complex. Language; Religion; Values (Hofstede, Trompenaars/ GLOBE)/ attitudes; Customs & Manners. Affect face-to-face, company & firm-customer levels; diversity strategies
China’s growth unprecedented.
Government policies: Three-Step, Key National Projects/5 Year Plans & Going Global. Now Belt & Road initiative; hi tech emphasis. Opportunities for inputs (labour, R&D, scale) & outputs (markets).
But income disparities & unemployment;
corruption & IP theft; health & safety, quality, environmental & social challenges; inconsistent laws; communication & culture (guanxi, face); partner experience vital
Innovative MNEs sense,
respond & implement through different structures; SME definitions vary & face capital & knowledge challenges; but more innovative & entrepreneurial? Personal networks & clusters core dynamic capability? Born global (or regional?) may challenge Uppsala model
EU most successful bloc,
meeting many objectives; but contemporary issues: Bailouts, economic stimulus & economic restructuring; austerity; Grexit; Brexit; social security & healthcare; CAP; enlargement & accession; security threats, COVID-19 & the Ukraine War. Firms’ integration v national responsiveness strategies
Organisation structures change with lifecycle & integration v responsiveness;
but embed culture, power & knowledge; pros & cons. Early growth often means domestic extension, then international division; but then choice of many structures
Emerging countries increasingly vital for both
Triad & indigenous MNEs’ resource-seeking & markets. Shifting & compressing CSAs, but explained by wild geese theory? Is the Base-of-the-Pyramid MNEs’ future, or unethical/ unprofitable mirage?
