Please enable JavaScript.

Coggle requires JavaScript to display documents.

CS-3 Global Strategy, CS4-Corporate Strategy, localization strategy, high…

- - - - Due to unfamiliarity, geographic distance, and economic or political risks.
    - - Need to develop new capabilities and adapt existing ones for the foreign market.
  - - - Choose based on ability to manage risks (e.g., exporting, licensing, joint ventures).
    - - Expand first to nearby or similar markets using low-risk modes, then move to distant markets with higher-risk modes.
  - - - Challenges Faced
        
        Bilingual laws and currency differences delayed expansion.
      - Illustration of Liability of Foreignness
        
        Even similar markets present unique challenges.
  - - - Local country advantages and supportive government policies.
    - - A flower exporting company using email orders and international expertise.
    - - International from inception, leveraging improved communication and international talent flows.
  - - - Adjusting to different cultures and languages.
    - - Managing different currencies and economic conditions.
    - - Hurdles that can make operations difficult.
    - - Potential backlash and animosity from being seen as a foreign entity.
    - - Different laws and regulations to comply with.
  - - - Need to adapt and learn new environment.
    - - Start with a low-risk entry model and, over time, move to a higher-risk model.
    - - Requires comprehensive strategic considerations.
- - - - e.g.
        
        Volkswagen, BMW, daimler all competing in the German market
        
        Lead to stronger firm capabilities
  - - - e.g.
        
        Switzerland strong in chemicals, moved over into the pharmaceutical industry
        
        The complementarity is that a whole healthcare industry developed in Switzerland
- - - - Its organization along product lines internationally and relatively less independence for each country operation
        
        Try to drive down costs globally.
  - - - Largely selling the original
        product,often companies in their early phase of internationalization
  - - - matrix structure,to quickly move around knowledge within the company
- - - - Purchase and repurpose existing assets.
    - - Buy and integrate a local company.
    - - Built from the ground up.
  - - - Political connections
      - Shared risk and investment
      - Local market knowledge
      - Local manufacturing and marketing capabilities
    - - Potential for misalignment in objectives
      - Shared profits
      - Reduced control
      - Risk of knowledge transfer to a potential competitor
  - - - Shared risk and investment, but reduced control and profit.
    - - Low cost and risk, but also low control and profit.
    - - High control and profit, but high cost and risk.
- - - - 1. Expand the market
        
        OECD countries, China and India
      - 2. Access better or lower cost factors of production
        
        Natural resources/ Low labor costs/ Capabilities
      - 3. Reduce business risk
      - 4. Lverage the core capabilities
      - 5. Develop new capabilities
        
        ex Doing IT development in India
  - - - John Deere
        
        Follow and enable human flourishing
  - - - Contract transfer rights within the foreign country
        
        To intangibles that are core to the value delivered in business
    - - Local partner
        
        Involve more coordination
    - - Sale of product or services DIRECTLY
    - - Local company
        
        Required :warning:
        
        China Law
        
        To create a joint venture with a Local company
        
        Build factories in high-value industries
        
        Reputation or knowledge of local politics
        
        Marketing and distribution capabilities in the home market
        
        Ability of manufacturer and manage suppliers locally
      - Independent company
      - Create significant scale or a combination of resources
- - - - Decline in Costs
- - - - crack the production process dependencies
- - - - e.g.
        
        Since the 1960s, we have in fact seen a remarkable increase in global trade and investment flows which has grown a lot from a level of about 22% of GDP to over 50%.
- - - - Owners of stock can buy and sell stock
    - - Board of directors
        
        Responsible for all of the stakeholders in the corporation
    - - The residual claim in this call the, shareholder
        
        Managers have control
        
        OPM : Other people's money
    - - Key to a publicly traded corporation
  - - - Shareholders
        
        Board of Directors
        
        Management
        
        Employees
      - Different corporate governance rules
        
        50 states in the U.S.
        
        Different countries, eg, Germany, France, China, Japan
  - - - Accounting scandals
        
        Agency problems and so managers acting in their own self-interests
        
        Collecting lots of revenue and trying to move up their stock price and get more bonuses and things like that
        
        Eg: Enron Corporation, WorldCom and Tyco
      - Global financial crisis
        
        Real estate bubble burst
- - - - Such as, generating a higher return on equity
    - - Too much concern that are primarily financial
        
        Broadening the Mission
        
        Balanced Scorecard
        
        Customer: differentiation, cost, quick response
        
        Operations: product developed, order fulfillment, demand management
        
        Financial: EVA, profitabilty, growth
        
        Organizational: leadership, learning, ability to change
        
        Ecosystem Strategies
        
        Business Ecosystem: An economic community supported by a foundation of interacting organizations and individuals-the organisms of the business world
        
        Eg: Malls, Toyota supplier-dealer network, Apple, Amazon, Facebook, Silicon Valley, Coursera
        
        Multiple players interact with each other on their platform in order to create value
        
        Within this broad ecosystem, cooperation and partnership with others, which we can now think of as stakeholders, are especially important for the long-run success of companies
        
        Poison pill provisions
        
        Difficult and costly for shareholders to replace the company's management
        
        1 more item...
        
        Take the company private
        
        Led to huge growth in the private equity industry
        
        Unicorns
        
        Startup companies with valuations that exceed a billion dollars
        
        Two classes of shares
        
        Preference shares
        
        1 more item...
- - - - xcessive stock options can lead to market manipulation
- - - - The US
    - - China