You are on page 1of 38

Chapter 11

International Strategic
Management

Copyright 2013 Pearson Education, Inc. publishing as Prentice Hall

Chapter 11 - 1

Learning Objectives
Characterize the challenges of international
strategic management
Assess the basic strategic alternatives that
are available to firms
Distinguish and analyze the components of
international strategy
Learn the process of international strategic
management
Review levels of international strategies
Copyright 2013 Pearson Education, Inc. publishing as Prentice Hall

Chapter 11 - 2

The Challenges of
International Strategic
Management

Copyright 2013 Pearson Education, Inc. publishing as Prentice Hall

Chapter 11 - 3

International Strategic
Management
Planning

Copyright 2013 Pearson Education, Inc. publishing as Prentice Hall

Strategy

Chapter 11 - 4

Fundamental Questions for


a Firms Strategic Planners
What products and services to sell?
Where and how to make them?
Where and how to sell them?
Where and how to get resources?
How to outperform the competition?
Copyright 2013 Pearson Education, Inc. publishing as Prentice Hall

Chapter 11 - 5

International Strategy
1. Developing
2. Implementing
3. Monitoring
4. Controlling
Copyright 2013 Pearson Education, Inc. publishing as Prentice Hall

Chapter 11 - 6

Competitive Advantage
Global Efficiencies
Multinational Flexibility
Worldwide Learning
Copyright 2013 Pearson Education, Inc. publishing as Prentice Hall

Chapter 11 - 7

Summary of Discussion

Copyright 2013 Pearson Education, Inc. publishing as Prentice Hall

Chapter 11 - 8

Strategic Alternatives

Copyright 2013 Pearson Education, Inc. publishing as Prentice Hall

Chapter 11 - 9

Home Replication
Core
Competency
Specific
Advantage
Copyright 2013 Pearson Education, Inc. publishing as Prentice Hall

Chapter 11 - 10

Multidomestic Strategy
Operating Subsidiaries with
High Low
Local-Market Focus
Differences Among National Markets

Economies of Scale
Cost of Coordination
Copyright 2013 Pearson Education, Inc. publishing as Prentice Hall

Chapter 11 - 11

Global Strategy
World Market = Single Entity
Standardizes Goods and Services
Pursues Economies of Scale
Centralizes Power and Decision Making
Copyright 2013 Pearson Education, Inc. publishing as Prentice Hall

Chapter 11 - 12

Transnational Strategy
Pursues Dual Goals

Global-Scale
Efficiency
Copyright 2013 Pearson Education, Inc. publishing as Prentice Hall

Local
Flexibility
Chapter 11 - 13

High

Global

Transnational

Low

Global Integration

Strategies for Balancing


Integration and Responsiveness

Home Replication

Multidomestic

Low

High
Local Responsiveness

Copyright 2013 Pearson Education, Inc. publishing as Prentice Hall

Chapter 11 - 14

Summary of Discussion

Copyright 2013 Pearson Education, Inc. publishing as Prentice Hall

Chapter 11 - 15

Components of an
International Strategy

Copyright 2013 Pearson Education, Inc. publishing as Prentice Hall

Chapter 11 - 16

Distinctive Competence
Cutting-Edge Technology
Efficient Distribution Networks
Superior Organizational Practices
Well-Respected Brand Names
Copyright 2013 Pearson Education, Inc. publishing as Prentice Hall

Chapter 11 - 17

Scope of Operations
Market
Niches
Geographic
Regions
Copyright 2013 Pearson Education, Inc. publishing as Prentice Hall

Chapter 11 - 18

Resource Deployment
Products
Geography
Combination

Copyright 2013 Pearson Education, Inc. publishing as Prentice Hall

Chapter 11 - 19

Synergy

Whole Exceeds the Sum of Parts


Copyright 2013 Pearson Education, Inc. publishing as Prentice Hall

Chapter 11 - 20

Summary of Discussion

Copyright 2013 Pearson Education, Inc. publishing as Prentice Hall

Chapter 11 - 21

Developing International
Strategies

Copyright 2013 Pearson Education, Inc. publishing as Prentice Hall

Chapter 11 - 22

Steps in International
Strategy Formulation
1. Develop Mission Statement
2. Perform SWOT Analysis
3. Set Strategic Goals
4. Develop Tactical Goals and Plans
5. Develop Control Framework
Copyright 2013 Pearson Education, Inc. publishing as Prentice Hall

Chapter 11 - 23

Mission Statement
Purpose
Values
Directions

Copyright 2013 Pearson Education, Inc. publishing as Prentice Hall

Chapter 11 - 24

SWOT Analysis
Strengths

Weaknesses

Opportunities

Threats

Copyright 2013 Pearson Education, Inc. publishing as Prentice Hall

Chapter 11 - 25

Porters Value Chain


Primary Activities

Support Activities

R&D and
Design

Manufacture

Marketing

Distribution

After-Sales
Service

Organizational Structure and Culture


Management of Information Systems
Human Resource Management
Supply Chain Management

Copyright 2013 Pearson Education, Inc. publishing as Prentice Hall

Chapter 11 - 26

Strategic Goals
Measurable
Feasible
Time-Limited

Copyright 2013 Pearson Education, Inc. publishing as Prentice Hall

Chapter 11 - 27

Develop Tactics
Strategic
Goals

Copyright 2013 Pearson Education, Inc. publishing as Prentice Hall

Daily
Activities

Chapter 11 - 28

Control Framework
Managerial Processes

Strategic Goals
Organizational Processes
Copyright 2013 Pearson Education, Inc. publishing as Prentice Hall

Chapter 11 - 29

Summary of Discussion

Copyright 2013 Pearson Education, Inc. publishing as Prentice Hall

Chapter 11 - 30

Levels of International
Strategy

Copyright 2013 Pearson Education, Inc. publishing as Prentice Hall

Chapter 11 - 31

Corporate Strategy
Single Business
Related Diversification
Unrelated Diversification
Copyright 2013 Pearson Education, Inc. publishing as Prentice Hall

Chapter 11 - 32

Business Strategy
Related Diversification

Unrelated Diversification

Strategic Business Unit (SBU)

Differentiation

Overall Cost
Leadership

Copyright 2013 Pearson Education, Inc. publishing as Prentice Hall

Focus
Chapter 11 - 33

Three Strategies
Differentiation
Cost Leadership
Focus Strategy

Copyright 2013 Pearson Education, Inc. publishing as Prentice Hall

Chapter 11 - 34

Functional Strategies
Core
Finances
Competency

Resources
Operations
and Supplies

Human
New Markets
Resources

Research and
Industry Rivals
Development

Copyright 2013 Pearson Education, Inc. publishing as Prentice Hall

Chapter 11 - 35

Summary of Discussion

Copyright 2013 Pearson Education, Inc. publishing as Prentice Hall

Chapter 11 - 36

Chapter 11

International Strategic
Management

Copyright 2013 Pearson Education, Inc. publishing as Prentice Hall

Chapter 11 - 37

All rights reserved. No part of this publication may be reproduced, stored in a retrieval
system, or transmitted, in any form or by any means, electronic, mechanical, photocopying,
recording, or otherwise, without the prior written permission of the publisher. Printed in
the United States of America.

Copyright 2013 Pearson Education, Inc. publishing as Prentice Hall

Chapter 11 - 38