The three Levels of Management

Normative Management

When a company defines its goals and purpose, it is defining structures, measures and behavior on _____

Strategic Management

Operational Management

Vertical Integration

Horizontal Integration

Levels of Strategy

A strategic positioning decision strives to match:

Combine the focus of strategic analysis to right level of the 4 strategies:
1. Core competence: which level?
2. Design of a value chain activity for competitive advantage?
3. Cooperation?
4. Competitive positioning and advantage?

Achieving synergies between businesses is main task on ..
which strategic level?

____ are the two basic strategies for creating value and attaining a competitive advantage in an industry

A _____ is a special outlook, skill, capability, or technology that runs through the firm's operations, weaving together all value activities into an integrated value chain.

What strategic actions has Rivella implemented in order to change the diminishing profits in its home market? Name three strategic actions.

Core of business strategy: Strategic positioning
inside out (unique competencies) and outside in (industry attractiveness)
w1,p.41

Michael Porter’s Value Chain:
Value-Chain analysis helps to understand the potential and performance of resources and capabilities, thereby calcifying cost structures and value creation.
Explain the value chain with primary and supportive activities.
ISM Reader page 66

The Product / Market Matrix by Igor Ansoff
explain the 4 strategies.

The way a company creates value and firm performance through strategic integration of cross-border business activities.

what's that?

Levels of Strategy
explain the focus of
Network strategic level

Levels of Strategy
explain the focus of
Corporate strategic level

Levels of Strategy
explain the focus of
Business Strategic level

Levels of Strategy
explain the focus of
Functional Strategic Level

Mercantilism

Absolute Advantage
by Adam Smith

Comparative Advantage
by David Ricardo

Factor Proportion Theory
by Heckscher & Ohlin

New Trade Theory
by Paul Krugman

New New Trade Theory
by Marc Melitz

Difference
FPT (Factor Proportion Theory) by Heckscher & Ohlin
and
Comparative Advantage
by Dave Ricardo

Classical country-based trade theories
name 4

modern firm-base trade theories
name 4

Theory of Competitive Advantage of Nations (CAN)
by Porter called the Diamond model

Porter's Diamond Model
1. Factor: the Factor Conditions

Porter's Diamond Model
2. Factor: Demand Conditions

Porter's Diamond Model
3. Factor: Related and Supporting Industries

Porter's Diamond Model
4. Factor: Firm Strategy, Structure and Rivalry

Porter's Diamond Model
Two Moderators: Government and Chance

First-mover advantage, explain this condition

Competitive advantage of nations (CAN) model by Porter
1. who exports?
2. who produces?
3. where to invest?
4. Free trade promotion?

Case - The Old-New Trade Theory - Krugman
Introduction into the research agenda of Paul Krugman. He focuses on aggregated trade flows and patterns of countries. what was the impact?

What is the relevance of “monopolistic markets”?

What is the relevance of “similar-similar trade“?

What is meant by “increasing returns on trade”?

What is meant by “increasing returns on geography”?
1. explain the home market effect
2. why is this effect self-enforcing?

What is competitiveness of a country.
Name some competitiveness dimensions

Why and How do Firms gain from being in a Cluster?

explain a MNE firms
Vision
Mission
(strategy starts with both. Togehter combined they represent an MNE's definition of purpose, values, goals and direction.

Name 7 company stakeholders

...... is the measure of a firm's capability of selling what it makes for more than the costs incurred in making it.

Factors that influence the configuration of a value-chain include:
name 7

Legal definition of a corporation

Business Systems describe what?
w3, p5

The term "Business System" may be applied at levels.
explain the 5 layers and its levels.

name 2 example countries which use the "Anglo-Saxon" Business system.

name 4 countries which use a "Communitarian" Business System

name 4 countries which use "Emerging" Business systems

Analytical Framework:
Business Systems Characteristics

Differences in Business Systems manifest themselves in 3 areas..

Framework for Business System Analysis
explain the 4 fields (hard&soft factors within macro&micro level)

What is a core company?
what kind of problems do they control?

Market share/Market growth matrix:
The BCG-Matrix

Market attractiveness/Competitive advantage matrix: The (GE) McKinsey Matrix 2

Industry attractiveness (IO)
Industrial Organization

Unique competencies
Competitive Cost & Customer Analysis The Porter’s Company Value Chain (1985)

explain the 2 context and 2 strategy level
w4,p20

Unique competencies
Competitive Cost Analysis
The McKinsey Business System (Industry Value Chain)
(1970s)

explain the 3 context and 3 strategy level
w4,p20

Unique competencies
Edith E. Penrose (1959) University of Baltimore 1959

«The Theory of the Growth of the Firm»

Unique competencies
Birger Wernerfeld,
MIT Sloan School of Management (1984)

«The Resource-based View of the Firm»

Unique competencies
C. K. Prahalad, Gary Hamel University of Michigan Harvard Business School (1990)

Core Competence

Unique competencies
D. Teece, G. Pisano & A. Shuen University of Michigan
Harvard Business School (1997)

Dynamic capability

Sustainable competitive advantage in international context is based on...

WHAT IS BLUE OCEAN?

Red Ocean strategy
Red oceans are all the industries in existence today.

Blue Ocean Strategy
Blue oceans denote all the industries not in existence today – the unknown market space, untainted by competition.

The Four Actions Framework to create a Blue Ocean

Cost reduction and local responsiveness are driven by different variables

» Pressures for global integration and cost reductions are greatest when:
name 4

Cost reduction and local responsiveness are driven by different variables

» Pressures for local responsiveness arise from:
name 4

Four archetypes of international corporate-level strategy

» Traditional MNC Cultural Orientation
low Responsiveness / low Cost Pressure
Ethnocentric means?

» Traditional MNC Cultural Orientation
high responsiveness / low cost pressure
Polycentric means?

» Traditional MNC Cultural Orientation
low responsiveness / high cost pressure
Geocentric means?

» Traditional MNC Cultural Orientation
high responsiveness / high cost pressure
Regiocentric means?

The characteristics of a multi-domestic strategy are..

The term ________ refers to a global company that thrives on seeking unique ideas and insights from locations around the world and then leveraging that knowledge in international markets.

Citibank decides to open a call center in Mumbai, India because a detailed analysis of the country-specific advantages suggests that India is the optimal place for responding to customers' calls. Citibank is exploiting ________ by running a call center in India.

Which industry tend to push to which international strategy archetype:
Private Banking

Which industry tend to push to which international strategy archetype:
Accommodation

Which industry tend to push to which international strategy archetype:
Power Supply

Which industry tend to push to which international strategy archetype:
Microprocessors

Preston Electronics is an MNE with facilities located in Taiwan, Singapore, and Germany. Preston gives its local operations the authority to adapt value activities to prevailing local economic, political, legal, and cultural conditions. Preston is most likely using aNein ________ strategy.

Firms that compete in the global marketplace typically face the asymmetric forces of pressures for ________ and ________.

Zara creates, produces, and distributes most of its products from its headquarters in Spain. Zara is most likely using a ________ configuration

discrete series of steps taken to move a product from conception to end-users

what kind does this sentence describe?

How to approach a case study task on International Strategy?

Expandig globally allows for rise of profitability and profit growth.
how?
w5, p.10

Internationalization as a decision influenced by a combination of drivers, barriers and risks.
what are the pull drivers?

Internationalization as a decision influenced by a combination of drivers, barriers and risks.
what are the push drivers?

Unsolicited order what's that?

Barriers of Internationalization
name 3

Risks of Internationalization
name 4

Reasons for internationalization of Swiss SME (in 2016)
name the 4 main reasons.

Obstacles in the internationalization process of Swiss SME (in 2016)
name 4

The relationship DoI and performance
W5, p.44

Different DoI-Performance-Links

draw the shape lines for Germany, US and Japan

DoI-Performance link for Swiss companies

Summary: The relationship between DoI and performance of USA, Germany and Switzerland

Internationalization of customers & competitors
Unsolicited orders and foreign market opportunities
are all examples for
push or pull drivers of internationalization?

Legal Rules
Liberalization of Markets and Removal of Trade Barriers
are all examples for
push or pull drivers of internationalization?

Growth and profit goals, economies of scale and scope
Unique product (technology/value proposition)
are all examples for
push or pull drivers of internationalization?

Foreign market opportunities
Favorable Ressource Opportunity
are all examples for
push or pull drivers of internationalization?

Theories and models of internationalization
explain
Transaction cost theories of Internationalization (FDI)

Theories and models of internationalization

explain
Vernon's International Product Life-Cycle (PLC)
w6, p.12

Theories and models of internationalization

explain
OLI (Eclectic Paradigm)
w6,p15

The higher the O::
The higher the L::
The higher the I::

Theories and models of internationalization

explain
The Stages (Uppsala) Model: Gradual process

Explain brief the 5 Uppsala Model: Internationalization as a step-by-step process

Theories and models of internationalization

explain
The Network Approach to internationalization

Theories and models of internationalization

explain
Born Globals: Factors influencing early internationalization

Theories and models of internationalization

what is the
The Springboard Model

The Springboard Model
explain
1. motivation
2.reasons to spring
3. unique activities
4. challenges

Factors influencing the internationalization process

name 6 foreign market entry modes

explain Export
1. options
2. pro/con

explain Licensing
pro and cons

explain Franchising
pro/cons

explain Joint Ventures
pro/con

explain M&A
pro/con

explain Strategic Alliances
pro/con

explain
Wholly owned subsidiary (FDI)
pro/con

Timing of entry
First-mover advantage
pro/con

Selecting an Entry Mode
name all modes and explain advantages/disadvantages

Core competence and entry mode
-technological know-how
-management know-how
state the different approach

FDI
Acquisition
pro/con

FDI
Greenfield venture
pro/con

FDI
choose Greenfield venture or Acquisition?

Classification of foreign market entry strategies

Which transaction refers to the sale of goods/services produced by a company based in one country to customers that reside in a different one?

Companies are likely to export products abroad in all of the following situations:
name 3

Name 3 examples of property rights that may be licensed to one company from another

a company's location should be flexible enough to?

what is the most likely reason that firms avoid aggressively seeking export opportunities?

explain Internationalization advantage

Explain the primary reason for technology licensing to take place while a product is still in the development stage:

If a company that wants to acquire knowledge most likely use .... as a method for expansion.

The basic risk management process in five steps are?

The four major risks categories are?

Basic risk typologies: Three-layered framework

General environmental risks:
PESTEL-R is a simple framework that helps you systematically identify potential risks in the business environment.
Review the 5

Industry-specific risks:
The industry value chain and its business economics provide a framework for analysis of the industry-specific risk drivers.
the 5-forces are?

Company-specific risks:
The major business functions and/or company value chain elements offer a possible risk areas framework.
There are 9 internal risk areas

Risk assessment matrix
what are the x and y axis?

The global risk landscape 2018 (according to WEF)
the 4 major risks are?
w8,p.25

Risks, crises and corporate actions
w8, p26

Risk assessment and corresponding risk response strategies

Financial responses to uncertainties and risks

Strategic responses to uncertainties and risks. name 6 Mitigation Strategies

Five success factors for internationalization through digitalization

Visionary leadership: Four major traits

Global coordination
explain:
Coordination by Standardization

Global coordination
explain:
Coordination by Plan

Global coordination
explain:
Coordination by Mutual Adjustment

In successful companies structure follows strategy..
Basic organizational choices: Differentiation
When organizing for international business, management needs to consider the following three dimensions:

Vertical differentiation:
Premises and Advantages

Archetypes of International Organization:
::International Division::
- foreign markets are to be exploited opportunistically
- Foreign Sales / Total Sales is low -> start of the internationalization

what are the pro&cons?

Archetypes of International Organization: Geographic (global) area structure

- foreign markets are to be exploited systematically
- regional markets differ strongly from each other
- advantages are achieved regional or local
- high grade of internationalization

what are the pro&cons?

Archetypes of International Organization:
::(Worldwide) functional structure::

- Competitive advantages in the global functions
- competitive pressures push for a global strategy

what are the pro&cons?

Archetypes of International Organization:
::(Worldwide) product structure::

− Advantage in global product categories or groups
− pressures for local responsiveness are comparatively low

what are the pro&cons?

Archetypes of International Organization: ::Global matrix structure::

- Transnational strategy
- Coordination of product divisions and regional structures needed

what are the pro&cons?

Structure reflects strategy for success
which strategy has Pressures for Global Integration and Cost Reduction?
which strategy has Pressures for Local Responsiveness?

What is the organizational architecture that international business use to manage and direct their global operations?

what does organizational structure mean?
name three things

Knowledge network
great strength of it?
ism reader p. 305

Types of control system
name 4
ism reader p. 307

Localization strategy: explain Structure and controls

International strategy: explain Structure and control

Global Standardization strategy:
explain Structure and Control

Transnational Strategy: Explain structure and control

Organizational inertia
name 4 reasons why organizations are difficult to change
ism reader p. 319

Specifying the Value Chain
Explain primary activities:

Specifying the Value Chain
Explain secondary activities:

Domestic Marketing
explain
1. Orientation
2. Product planning
3. marketing mix decisions
w12, p.16

Export Marketing
explain
1. Orientation
2. Product planning
3. marketing mix decisions
w12, p.16

International Marketing
explain
1. Orientation
2. Product planning
3. marketing mix decisions
w12, p.16

Multinational Marketing
explain
1. Orientation
2. Product planning
3. marketing mix decisions
w12, p.17

Global Marketing
explain
1. Orientation
2. Product planning
3. marketing mix decisions
w12, p.17

Two main segmenting approaches

What is the aim of:
Segmenting and targeting on the international markets

Consumer culture brand positioning
explain
1. Global
2. Foreign
3. local

Brand internationalization
name the 4

International Marketing implementation: Product strategy important decisions

International Marketing implementation: Pricing strategy
name the 3

International Marketing implementation: Pricing strategy
what are the three Strategic pricing?

International Marketing implementation: Communication channels
Personal channels like One-to-one, mouth-to-mouth, guerrilla and viral, influencers, own webpage, blog ,social media better when:

International Marketing implementation: Communication channels are Influenced by?