Week 1

Question 1

Liability of Foreignness

Answer 1

The vulnerability facing organizations that venture outside of their familiar territory.

• Regulations
• Caps on foreign ownership
• Cost of communication
• Cost of adaptation
• Learning curve

Question 2

Paradox of Consistency

Answer 2

The forces that make it possible for an organization to compete successfully in their home market are not necessarily transferrable to other markets. NFL example

Question 3

Sun Tzu

Answer 3

a Chinese general, military strategist, and philosopher who lived in the Spring and Autumn period of ancient China. Sun Tzu is traditionally credited as the author of The Art of War, a widely influential work of military strategy that has affected both Western and Eastern philosophy.

Question 4

Military Strategy

Answer 4

• Grand Strategy
• Strategy
• Tactics

Question 5

Grand Strategy (Military)

Answer 5

Advancing goals through war and peace. E.g.: containment of the USSR in the Cold War

Question 6

Strategy (Military)

Answer 6

Art of winning a war. E.g.: “Europe first” strategy by US during WWII (Pacific theater not the priority)

Question 7

Tactics (Military)

Answer 7

Art of winning a battle, e.g., which hill to take.

Question 8

Grand Strategy (Business)

Answer 8

Choosing which advantage to build and where to deploy this advantage

Question 9

Strategy (Business)

Answer 9

Positioning the firm with respect to what and to whom you sell and its value chain.

Question 10

Tactics (Business)

Answer 10

Winning a client, selecting a supplier, pricing a product

Question 11

What is Strategy?

Answer 11

• Create and sustain an competitive position
• Creating superior value (i.e., having a competitive advantage) permits attracting and retain customers while turning a profit.
• How superior value is created matters for the sustainability of the advantage.

Question 12

Value Capture

Answer 12

Question 13

Competitive advantage definition

Answer 13

A company has a competitive advantage when it
adds greater value to the marketplace than its direct competitors.

Question 14

Types of Competitive Advantage

Answer 14

Question 15

Business Strategy Definition

Answer 15

What is the source of a company’s competitive advantage?

Question 16

Corporate Strategy Definition

Answer 16

What is the scale and scope of a company’s activities?

Question 17

Three Generic International Strategies

Answer 17

1. Deploy
2. Develop
3. Deepen

Question 18

Deploy (Three Generic International Strategies)

Answer 18

Companies seek to aggregate demand across multiple markets.

The focus is on similarities across markets. Companies typically identify a market segment that is consistent across markets (e.g., luxury).

Question 19

Develop (Three Generic International Strategies)

Answer 19

Companies seek arbitrage knowledge across countries.

Companies create and capture value by identifying where a potential new capability resides and integrating those capabilities to improve
products or reduce costs.

Question 20

Deepen (Three Generic International Strategies)

Answer 20

• Companies use their international presence to make their core competitive advantage more sustainable.
• Most commonly, this involves arbitraging labor costs.
• But it can also involve aggregating production in order to create economies of scale and scope.