MIDTERM REVIEW QUESTIONSMODULE: INTERNATIONAL STRATEGIC MANAGEMENT (Chapter 1 to 4)

Chapter 1: Strategizing around the globe

1. What is global strategy? A skeptical classmate says: “Global strategy is relevant for top
executives such as CEOs in large companies. I am just a lowly student who will struggle to gain
an entry-level job, probably in a small company. Why should I care about it?” How do you
convince her that she should care about global strategy?

Global strategy: is one that the company provide standardized products and/or services on a
worldwide basis, which any strategy outside one’s home country.
Global strategy include strategies of firms around the globe: Both international and non-
international (domestic) ; Both developed and emerging economies.
With the current rapid growth of the world economy, understanding the global strategy of each
individual is very important. So, develop a global strategy that helps your role in your business in
several ways. The first way of understanding the global strategy gives you the power to improve
the efficiency of your company's products and services. As your company grows and learns, you
become more efficient at launching new and improved products or services that bring benefits
to customers and profit. Moreover, creating a comprehensive global strategy also allows your
company to adapt quickly wherever needed based on customer demands and trends in the
global marketplace, when your company focuses on new markets, you can reduce their cost
through standardization, with its experience and taking advantage of the internet, you can serve
customers better all over the world and all at low cost.

2. What is globalization? Some argue that globalization benefits citizens of rich countries. Others
argue that globalization benefits citizens of poor countries. What are the ethical
dilemmas here? What do you think?
Globalization is the process by which businesses or other organizations develop international
influence or start operating on an international scale.
Globalization is a very controversial issue. It was a lot of news but they were not discussed
seriously in the media. The anti-global movement has evolved. They oppose the WTO's
assumption that it is undemocratic, that globalization increases inequality and further
impoverishes the poor. Global supporters argue that free trade creates wealth, and this
increases the difficulty and improves the situation of the poor. In my point of view, globalization
represents free trade which promotes global economic growth; creates jobs, makes companies
more competitive, and lowers prices for consumers. It also provides poor countries, through
infusions of foreign capital and technology, with the chance to develop economically and by
spreading prosperity, creates the conditions in which democracy and respect for human rights
may flourish. There is now a worldwide market for companies and consumers who have access
to products of different countries. Labor can move from country to country to market their
skills. Transnational companies investing in installing plants in other countries provide
employment for the people in those countries often getting them out of poverty. So , it has
many benefits for both the rich and the poor, so globalization is still an important factor today.
Chapter 2: Managing industry competition

1. Why do price wars often erupt in certain industries, such as the automobile industry, but less
frequently in other industries, such as the diamond industry? What can a firm do to discourage price
wars or to better prepare for price wars?

2. Compare and contrast the five forces affecting the airline industry, the fast food industry, the beauty
products industry, and the telecommunication industry in your country. Which industry holds more
promise for earning higher returns? Why?

Chapter 3:Leveraging resources and capabilities

1. Pick any pair of rivals in the same industry (such as Boeing/Airbus and Cisco/Huawei), and
explain why one outperforms another.

Chapter 4: Emphasizing institutions, cultures and ethics

1.How does the institution-based view complement and differ from the industry-based and
resource-based views? Why has the institution-based view become a third leg in the “strategy tripod?”

2.Find one example of institutional transitions from developed economies and one example from
emerging economies. What are their similarities and differences?