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Evaluation of countries for operations (COLLECTING AND ANALYZING DATA…
Evaluation of countries for operations
Introduction
Companies limited resources --> be careful in making the decisions
Location of scale, production
Sequence for entering different countries
Portion of resources
Location decision affecting international operations
Operating environment
Physical and social factors
Competitive factors
Operations
Objectives
Strategy
How does scanning work?
Scanning
The process by which managers examine many countries broadly and then narrow them down to the most promising ones
Informations importants
Opportunities: sales expansion
Examining Economic and Demographic Variables
Resource acquisition
Cost Considerations
Risks
Factors to Consider in Analyzing Risk
Companies and their managers differ in their perceptions of what is risky
Onecompany’sriskmaybeanother’sopportunity
here are trade-offs among risks
Companies may reduce their risks by means other than avoiding locations
Political risk
Analyzing Past Patterns
Analyzing Opinions
Examining Social and Economic Conditions
Foreign exchange risk
Competitive risk
Detailed Analysis
Managers need to go on location to analyze and collect more specific information.
COLLECTING AND ANALYZING DATA
SOME PROBLEMS WITH RESEARCH RESULTS AND DATA
Inaccuracy
Governments may purposely publish misleading information
Governmental resources may limit accurate data collection
Respondents may give false information to data collectors
Official data may include only legal and reported market activities
Poor methodology may be used
Non-Comparability
EXTERNAL SOURCES OF INFORMATION
Individualized Reports
Specialized Studies
Service Companies
Government Agencies
International Organizations and Agencies
Trade Associations
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
REINVESTMENT AND HARVESTING
Reinvestment Decisions
Harvesting
NONCOMPARATIVE DECISION MAKING