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Evaluation of Countries for operations (What information is important in…
Evaluation of Countries for operations
Introduction
Companies lack ressources to take advantage of all international opportunities
Companies needs to determine the order of country entry + set the rates of resource allocation among countries
How does scanning work ?
Scanning versus detailed analysis
Step 1 : scanning
Step 2 : Detailed Analysis
What information is important in scanning ?
Opportunities : sales expansion
Examining Economic and Demographic variables
Opportunities : Resource acquisition
Cost considerations
labor
Infrastructure
Ease of Transportation and communications
Governmental incentives and Disincentives
Caveat
Risks
Factors to consider in anlyzing risk
Companies and their managers differ in their perceptions of what is risky
One company's risk may be another's opportunity
Comapnies may reduce their risks by means other thanavoiding locations
Trade-offs among risks
Political risk
Analyzing past patterns
analyzing opinions
examining Social and Economic Conditions
Foreign exchange risk
Exchange rate changes
Mobility of funds
Competitive risk
Making Operations Compatible
Geographic Diversification
Following Competitors or Customers
Heading Off Competition
Collecting and analyzing DATA
Problems with research results and DATA
Inaccuracy
Non -Comparability
External sources of informations
Individualized reports
Specialized studies
Service Companies
Government agencies
Internatioanl Organizations and agencies
Internally generated DATA
Country comparison tools
Grids
Matrices
Allocating among locations
Alternative gradual Commitments
Geographic Diversification versus Concentration
Growth rate in each market
Sales stability in each market
Competitive lead time
Spillover effects
Need for product , communication and distribution Adaptation
Program control Requirements
Subsequent Product Diversification
Reinvestment and harvesting
Reinvestment decisions
Harvesting
Noncomparative decision making