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SMMC_G5__[CS-3] Global Strategy, G5 Group member, Factor Conditions,…

- - - - Often the first in internationalizing
      - Used by MNEs with relatively large domestic markets
      - Can be shipped across the globe (High-end products and luxury goods)
      - Have strong brands (Products and services)
      - Main competitive strategy tends to be differentiation
    - - Leveraging core competence
      - Economies of scale
      - Low-cost implementation through
      - Franchising
      - Licensing
    - - No or limited local responsiveness
      - Highly affected by exchange rate fluctuations
      - IP embedded in product or service could be expropriated
  - - - Used by MNEs to compete in host countries with large and/or lucrative but idiosyncratic domestic markets
      - Often used in consumer products and food industries
      - Main competitive strategy is differentiation
      - MNE wants to be perceived as local company
    - - Highest-possible local responsiveness
      - Reduced exchange-rate exposure
    - - High cost of implementation
      - Little or no economies of scale
      - Little or no learning across different regions
      - Higher risk of IP expropriation
  - - - 1.Used by MNEs they are offering standardized products and services
      - 2.Main competitive strategy is price
    - - 1.Location economics
      - 2.Economics of scale
    - - 1.No local responsiveness
      - 2.Little or no product differentiation
      - 3.Some exchange-rate exposure
      - 4."Race to the bottom" as wages increase
      - 5.Some risk of IP expropriation
  - - - 1.Used by MNEs that pursue an integration strategy at the business level by simultaneously focusing on product difference and low cost
      - 2.Think globally, act locally
    - - 1.Attempts to combine benefits of localization and standardization strategies simultaneously by creating a global matrix structure
      - 2.Economics of scale,location,and learning
    - - 1.Global matrix structure is costly and difficulty to implement, leading to high failure rate
      - 2.Some exchange-rate exposure
      - 3.Higher risk of IP expropriation
- - - - The situation you consider make foreign country
        
        Decide to take a low-risk approach like exporting or licensing.
        
        The new firm may depend on its ability,and then entry foreign country
  - - - Canada is very similar to the United States in
        many ways
      - Very few trade and investment barriers for a US company
      - Same language and culturue
    - - Canada's bilingual laws and to deal with the different currency.
      - More costly to do business in a foreign country
- - - - Want to locate manufacturing in China
    - - In running a chain of restaurants
    - - OECD countries
    - - Location specific advantages
    - - Operate in multiple countries
  - - - With a local partner
      - Grew in scope over time
    - - Manage jointly
      - Share in the profits
      - Contribute resources to create an independent company
    - - Transfer intangibles
      - Monitor performance
    - - 100 percent owned unit into a foreign country
      - created in a number of ways
        
        Greenfield
        
        The unit is built from the ground up
        
        Brownfield
        
        Purchased from another company and reused
        
        Acquisition
        
        Buy a local company and integrate
    - - Sale into foreign markets
      - Export indirectly via local agents
- - - - Trade,investment fiows,movement of labor,multinational firms
- - - - Japan & South Korea
    - - Australia
    - - China and Taiwan
    - - USA and India
    - - Germany and Japan
    - - United Kingdom
  - - - Meanings
        
        Demand conditions
        
        Specific characteristics of demand in a firm's domestic market
        
        Competitive intensity
        
        Highly competitive environments tend to stimulate firms to outperform others
        
        Factor conditions
        
        Nation's endowments
        
        Human
        
        Other resources
        
        Supportive infrastructure
        
        Institutions
        
        National
        
        Related and supporting industries
        
        Leadership in related and supporting industries fosters world-class competitors in downstream industry
      - Implications
        
        Co-creating a supportive ecosystem
        
        Tapping into foreign country advantages
        
        Understanding your own competitive arranges relative to foreign competitors
        
        Identifying potential sources of competition
    - - Saudi Arabia-Vision 2030 plan
        
        Logistics
        
        Energy
        
        Mining
        
        Industry