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Chapter 8 - Looking at International Strategies

Define international strategy and identify its implications for the strategy diamond. Understand why a firm would want to expand internationally and explain the relationship between international strategy and competitive advantage | Chapter 8 Looking at International Strategies OBJECTIVES Define international strategy and identify its implications for the strategy diamond 1 Understand why a firm would want to expand internationally and explain the relationship between international strategy and competitive advantage 2 Use the CAGE framework to identify desirable international arenas 3 Describe different vehicles for global expansion 4 Apply different international strategy configurations 5 Outline the international strategy implications of the static and dynamic perspectives 6 DELL GOES TO CHINA Dell became China’s largest computer system provider in just 5 years If we’ve not in what will soon be the second-biggest PC market in the world, then how can Dell possibly be a global player? Strategic decisions Vehicles Staging Consumers first, then corporations U.S. Assemble and distribute itself Corporations first China Partner “ “ INTERNATIONAL STRATEGY AND THE STRATEGY DIAMOND Economic logic Arenas . | Chapter 8 Looking at International Strategies OBJECTIVES Define international strategy and identify its implications for the strategy diamond 1 Understand why a firm would want to expand internationally and explain the relationship between international strategy and competitive advantage 2 Use the CAGE framework to identify desirable international arenas 3 Describe different vehicles for global expansion 4 Apply different international strategy configurations 5 Outline the international strategy implications of the static and dynamic perspectives 6 DELL GOES TO CHINA Dell became China’s largest computer system provider in just 5 years If we’ve not in what will soon be the second-biggest PC market in the world, then how can Dell possibly be a global player? Strategic decisions Vehicles Staging Consumers first, then corporations U.S. Assemble and distribute itself Corporations first China Partner “ “ INTERNATIONAL STRATEGY AND THE STRATEGY DIAMOND Economic logic Arenas Vehicles Staging Differentiators Arenas Which geographic areas will we enter? Which channels will we use in those areas? Which international market-entry strategies will we use? Alliances? Acquisitions? Greenfield investments? Vehicles How does being international make our products more attractive to our customers? Differentiators How does our international strategy lower our costs, raise the prices we can charge, or create synergies between our business? Economic logic When will we go international? How quickly will we expand into international markets? In what sequence will we implement our entry tactics? Staging PROS VS. CONS OF INTERNATIONAL EXPANSION Pepsi’s ambitious expansion in the 1990s resulted in a decreased international market share Wal-Marts international businesses perform poorly relative to its U.S. business Many international expansions fail Newness can be a disadvantage (e.g., your firm must move up the learning curve) Foreignness can be a liability (e.g., your .