International Strategic Management

International Structure
1. Initial Division Structures
  1. Subsidiaries
    1. that follow this kind of organization structure include firms where the main export is expertise, for example, consultants and financial firms.
  2. Export firms
    1. include those having technologically advanced products and manufacturing units.
2. International Division Structure
  1. To handle all international operations by a division created for control.
    1. Advantages
      1. International attitude gets the attention of top management.
    2. Disadvantages
      1. Separates domestic managers from their international counterparts.
3. Global Area Division
  1. Used for operations that are controlled on a geographic rather than a product basis. Used by firms in mature businesses with select product lines.
    1. Advantages
      1. International operations and domestic operations remain at the same level
4. Global Functional Division
  1. To primarily organize global operations based on function. Product orientation is secondary
    1. Advantages
      1. Functional leadership, centralized-control, and leaner managerial staff.
    2. Disadvantages
      1. Not suitable for all types of businesses. Applicable to only oil and mining firms
Ethical Considerations
1. Economic development
  1. Neo liberal View: Economic Growth GDP, missing other aspects Institutional View: capacity building: basic needs, life expectancy, respect ( Self -others).
    1. Client
      1. Quality Prices Misleading advertising Health requierement
    2. Employees
      1. Labour principles Wages
2. Business strategy
  1. Cost-minimization strategies: Increase profit: incirease FDI, competitiveness, Knowledege transfer, efficiency. Asset-development strategies: Investment : long-term value, protect investments, conditions skills for labour, GVC
    1. Suppliers
      1. conditions Payment
    2. Competitors
      1. Dumping Intellectual Property
3. Ethics of firms
  1. Ethics viewed as a means of policing: Ethics viewed as a call for social contribution:
    1. Government
      1. Transparency Informality
    2. Communit
      1. Environment Social Impact
International Strategy
1. International management
  1. Process of planning, organizing, directing, and controlling the organization, which individuals (managers) use to achieve an organization’s goals when the organization is involved in cross-border activities or functions outside its nation-state
2. International Business
  1. Business: a commercial or industrial enterprise that sells goods or services to customers. The domain of business studies is therefore the study of business as an enterprise (an organizational form).
3. International strategy
  1. Is the comprehensive set of commitments, decisions, and actions by firms to gain competitiveness internationally.
Orientation
1. Regiocentrism
  1. Main decisions made in regional headquarters
    1. Regional standards in regions
  2. High positions taken by regional managers
2. Geocentrism
  1. Focus on global objectives
  2. Global view
  3. Focus on global objectives
3. ethnocentrism
  1. Main decisions made in the main headquarter
  2. Home standards applied on all markets
  3. Focus on domestic objectives
4. Polycentrism
  1. Lower role of the main headquarter
  2. Local standards applied on local markets
  3. Identification with the nationality of host country
Mangement Decision
1. Multidomestic
  1. strategies and operating decision
    1. organizational structure natural
2. Trasnational
  1. firm seek to achive both global efficiency
3. Global
  1. standarization of the products
    1. worldwide product divisional organizational structure

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International Strategic Management

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