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Topic8-International.pptxWPC480 Strategic Management
Topic 8: International Strategy
Professor R. Scott Livengood
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Big Question Question
How can firms pursue international opportunities to help create a sustainable competitive advantage?
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Off the Map: The Rough Road Ahead for Self-Driving Cars in China
What challenges and opportunities face self-driving companies wanting to do business in China?
If you were the CEO of one of these firms, what would you do to overcome these challenges?
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The End of Typing: The Next Billion Mobile Users Will Rely on Video and Voice
What are some of the market conditions that make it attractive for the firms in this article to explore global opportunities?
What are some of the adjustments firms need to make to take advantage of these global opportunities? Why do the high-tech firms need to make these adjustments?
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International Strategy Snapshot
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Reasons for Internationalization
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Increased market size/demand
Economies of scale/learning
Location advantages
Types of International Strategy
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Global
Multi-domestic
Transnational
Methods of Going Global
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Importing
Buying and shipping foreign-produced goods for domestic consumption or production
Exporting
The shipping of a domestically produced good to a foreign destination for consumption or production
International Alliances
Agreements between companies from two or more countries
Greenfield
Entering a foreign company as a stand-alone entity
International Threats and Risks
Unstable governments, disruptions caused by territorial conflicts, wars, regionalism, illegal occupation, and political ideological differences
Changes in tax laws, rapid rises in costs, strikes, sudden increases in raw materials, and cyclical/ dramatic shifts in GNP
Antagonism among classes, religious conflict, unequal income distribution, union militancy, civil war, and riots
Political Risks
Economic Risks
Social Risks
Fluctuating exchange rates, repatriation of profits and capital, and seasonal cash flows
Financial Risks
Communication, coordination, control, lack of local knowledge/expertise
Managerial Risks
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Summary
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Strategies and modes should match core competencies
Internationalization brings new opportunities for growth & success
But new challenges and risks must be balanced to achieve success
