Managing in a Global Economy

Managing in a Global Economy Fall 2021

Lesson 10- 11 -12 Final Case Study

1

What is this about ?

• We have selected an industry • We have looked at the industry from many

different sides

• We have seen the opportunities • We have seen the challenges ! • Now you will become CEO of an industry in

your sector!

2

You are the CEO!

• You are the CEO • You determine strategy • Your company is in a period of slow growth • You decide that solution to slow growth • = foreign expansion • You need to make a plan that is viable = • Can be implemented !

3

What kind of company is it ?

• You will invent a company • You will not take an existing company in your

sector !

• You will not – I repeat – take an existing company in your sector !

• You will not invent a company and enter into a

joint venture with an existing company in your

sector !

4

Example !

• Company CEO – Jean Ergas • Company name – Jean Ergas Inc. • Company activity – Frozen Roast Chickens ! • Company size - Mid – size

5

Company Characteristics !

• Mid –size – this is in relation to your sector • You are not a market leader • You do not have a lot of pricing power • You will attempt to establish a stronger position by

going abroad !

6

Limited Foreign Experience !

• You have some foreign experience • You have limited foreign experience • You have experience of some exports • You do not have a dedicated export team • You do not have a dedicated international

division

• You are basically beginners !

7

To help you – an expert !

• You recently hired an: • An expert in the sector • An expert in international business • This person shall help you to develop a

strategy

8

Losing Market Share!

• You are not a large firm in your sector • You do not have a large market share • You are losing market share in a : • Increasingly price competitive environment • Slow macro economic growth environment • Slow sector growth environment

9

Structure of the Paper !

• You have a maximum of 600 words • You will not write more than 600 words ! • You will use this word allocation well ! • You will write short sentences • You will write one sentence = one concept !

10

3 Parts to the Paper !

• 1- Introduction: 100 words • 2- Discussion : 400 words • 3- Conclusion : 100 words

11

Part 1 Introduction - Brief summary of industry

• Introduction: • Say what your industry is • Summarize the industry: • For example: • My industry is the global PC sector. • It has sales of US Dollars billion • Growth is slow – moderate – fast !

12

Part 2 - Presentation !

• You shall present your plan • You shall explain why you have chosen this

plan

• You shall explain the opportunities • You shall explain the challenges • You shall explain why your plan: • Maximizes the opportunities • Offsets the challenges !

13

Part 3 – Conclusion !

• You will conclude by summarizing: • Strategy chosen • 2 major reasons why you chose it • 2 major risks to your strategy !

14

We go international !

• We need to make a plan • We need to look at many factors • We need to look at: • Our position in the sector • Growth prospects: • Domestic • International • We know international better than domestic /

home !

15

We need to look at our product !

• We need to look at product – standard – non standard

• We need to look at brand – strong – weak • We need to look at need to produce locally: • Weak • Strong • We need to look at capital investment: • Strong • Weak

16

Organization!

• We need to look at current organization • We are given this organization • We are a domestic focused company • We have a simple organization !

17

Organization ! Very Simple !

• We are organized by function: • Sales • Marketing • Production • Finance • We are not organized by product ! • We are not organized by region !

18

Will we need to change our organization ?

• Will you need to change your organization ? • Will you need to establish a: • International division • Product management structure ?

19

Marketing Strategy !

• Marketing Strategy: • Home replication • Global multi-product • Use these two basic models!

20

Finance !

• Finance – explain if + finance necessary yes – no

• Finance – if + finance necessary where will more finance come from:

• Current owners • New investors • Banks • This can be very brief !

21

Export or FDI ?

• Will you sell from the home office ? • Will you produce in your target market ? • Will you have a 2 phase strategy: • Export from home office • Production in the target market

22

Alone or Joint Venture ?

• Will you do this expansion alone ? • Will you do this expansion with a joint venture

partner?

• Will you choose a large local firm? : • Strong market position • Strong pricing power • Will you choose a mid size local firm: • You can obtain better conditions • You can build market together !

23

Summary !

• No real companies: • Your company • Partner • 600 words !: • Will stop reading after 600 words • Will take off 10 points every 100 words + • Clearly structure the paper !

24