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• Sources of Advantage:
• Sources of Advantage:
• Cost
• Differentiation
• Ability to coordinate activities
• Local responsiveness
• Speed in new product
• Minimize political risk development
• Minimize rate exchange risk Jeff Dyer - BYU
A FRAMEWORK FOR ANALYSIS
Pressures
for Global
Integration
Pressures
for Local
Differentiation Jeff Dyer - BYU
A Framework:
Global Integration - Local Differentiation
High
Global
Strategy
Forces for Global
Integration
Local Multi-domestic
Strategy Strategy
Low
Source: J. de
Jeff Dyer - BYU
la Torre
The Extreme Global Value Chain
Country Activities
Manu-
A R&D Desig Purchasing
facturing
Etc.
n
B Design
Purch-
C asing
Manu-
D facturing
E Marketing
F Selling
Distrib-
G ution
H Service
*
*
*
*
Purch- Manu- Market Distrib-
Z R&D Design asing facturing -ing Selling ution Service
E n v iro n m e n t / M a rk e t
C o s ts C o m p e t it o r s
C u s to m e rs G o v e rn m e n t
F irm S tra te g y
F irm S tru c tu re a n d P ro c e s s e s
A n a ly s is o f t h e e n v ir o n m e n t / m a r k e t p r e c e d e s c h o ic e o f fir m
s t r a t e g y w h ic h p r e c e d e s c h o ic e o f fir m s t r u c t u r e a n d p r o c e s s e s .
High
?
Forces for Global
Integration
Low