Global Strategies

Concepts, Models & Discussion Questions

Examples

Finland vs. U.S. (60x) & China (250x) Cell phones Soft drinks Shampoo Fast food PCs Video games Labor costs: U.S. vs. China

Why globalize?

Expand global market share Restructure value chain on a global scale Ultimate goal

What changes do global companies have to face?

Market size Complexity of foreign markets Buyers New entrants Rivalry

What are the two potentially conflicting dimensions in global strategies?

Global integration National differentiation

How are markets different across borders and what are the implications?

Pankaj Ghemawats CAGE Model:

Cultural distance Administrative and political distance Geographic distance Economic distance

Three types of global strategies: What are they?

Global strategy Multi-domestic strategy Transnational strategy

Why are there clusters of companies in certain industries and countries?

Porters Diamond Model of Competitive Advantage of Nations Demand Conditions Factor Conditions Related and Supporting Industries Strategy, Structure and Rivalry

What are the common market entry modes?

Exporting Licensing Strategic alliances Greenfield investments M&As

What are the appropriate organizational structures for global companies?

Bartlett and Ghosals Classifications:

Decentralized federations Centralized hubs Coordinated federations

Group discussion: Answer 2 questions

1. What has been CEMEXs competitive advantages in the global cement industry? How transferable are these competitive advantages across borders? 2. What has been CEMEXs primary entry mode in international markets? Explain the logic behind the use of this entry mode. 3. What has been the path of CEMEXs international market expansion. Explain the logic. 4. What challenges and opportunities does CEMEX face in the global cement industry? What would you recommend to the company in order to survive and thrive in the competition with other global competitors? (Required)