Term
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Definition
| The central comprehensive, integrated, and externally oriented set of choices of how a company will achieve its objectives |
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| basic ways that both domestic and multi-national companies keep and achieve competitive advantage |
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| When a company can outmatch its rivals in attracting and maintaining its targeted customers |
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| Strategy based on fidning ways to provide superior value to customers |
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| Producing products or services equal to those of competitors at a basic cost |
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| Applying a differentiation or low-cost strategy to a narrow market |
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| How broadly a firm targets its products or service |
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| All the activities that a firm uses to design, produce, market, deliver, and support its product |
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Term
Porter divides the value chain into two parts: _________ and _________
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| Primary activities and support activities |
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| upstream activities of a value chain |
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| Early activities such as R&D or dealing with suppliers |
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| downstream activities of a value chain |
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Definition
| Later value chain activities such as slaes and dealing with distribution channels |
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| Support Activities in a value chain include |
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Definition
| systems for human resources, organizational design and control, and a firm's basic technology |
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| The deliberate decision to have outsiders or strategic alllies perform certain activities in the value chain |
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| Strengths that allow companies to outperform rivals |
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| Inputs into the production or service processes |
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| The ability to assemble and coordinate resources effectively |
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| characteristics of strategies that are not easily defeated by competitors |
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| Types of sustainable strategies |
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Definition
| Offensive and Defensive competitive strategies |
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| Offensive competitive strategies |
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Definition
| direct attacks, end-run offensives, preemptive strategies, acquisitions |
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Term
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Definition
| include price cutting, adding new features, comparison advertisemets that show lesser quality |
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| companies try to avoid direct comeptition and see unoccupied markets, such as those underserved or ignored by competitors |
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| preemptive competitive strategies |
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Definition
| being first to gain a particular advantageous position including getting the best suppliers, buying best locations, best customers or globally being the first with a global strategey |
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Definition
| the firm buys its competitor |
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| Defensive competitive strategies |
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Definition
| attempts to reduce the risks of being attacked, to convince an attacking firm to seek other targets, or to blunt the impact of any attack |
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| Fending off a competitor's attack in one country by attacking in antoher country, usually the competitor's home country |
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| Business-level strategies |
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Definition
| Those for a single business operation |
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| corporate -level strategies |
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Definition
| How companies choose their mixture of different businesses |
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Definition
| A mix of businesses with similar products and markets |
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| Unrelated diversification |
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Definition
| a mix of businesses in any industry |
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Definition
| Process by whihc managers aelect the strategies to be used by their company |
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Term
| Porter's FIve Forces Model |
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Definition
| A popular technique that can help a multi-nation firm understand the major forces of work in the industry and its degreeof attractiveness |
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Term
| Five Forces in Porter's Model |
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Definition
1st - the degree of competition
2nd- to evaluate if there is the threat of new entrants
3rd- the bargaining power of buyers
4th- the bargaining power of suppliers
5th- the threat of substitutes |
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| Key Success Factors (KSFs) |
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Definition
| Important characteristcs of a company or its product that lead to success in the industry |
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Definition
| Innovative technology or products, a broad product line, effective distribution channes, price advantages, effective promotion, superior phusical facitlities or skilled labor, experience of the firm in business, cost position for raw materials, the cost position for procution, R&D quaity, financial assets, product quality, quality of human resources |
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Definition
| Profile of a competitor;s strategies and objectives |
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Term
| Four steps of competitor analysis |
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Definition
1. Identifying the basic strategic intent of competitors
2. Identifying the generic strategies used and anticipated to be used by competitors ( e.g. producing at the lowest cost)
3. Identifying the offensive and defensive competitive strategies currently used or anticipated by the rivals.
4. Assessing the current positions of competitors. |
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Definition
| Strengths, weaknesses, opportunites, threats |
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Definition
| The analysis of an orangization's internal strengths and weaknesses and the opportunities or threats from the environment |
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| SWOT - Internal components and External components |
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Definition
Internal components: strengths and weaknesses
External components: opportunities or threats |
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Term
Corporate Strategy Selection
Targets for growth and investment |
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Definition
| receive additional corporate resources because managers anticipate high returns |
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Term
Corporate Strategy Selection
Targets fo divestment |
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Definition
| businesses that mangers decide to sell or liquidate |
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Term
Corporate Strategy Selection
Targets for Harvesting |
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Definition
usually mature and profitable busiensses that manager see as sources of cash for other investments |
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Term
| BCG growth-share matrix divides businesses into four categories |
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Definition
| stars, dogs, cash cows, problem children |
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Term
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Definition
a business that is fast growing industric in which the business has a relatively large market share compared to the most successful firm in the industry
In the BCG growth share matrix strategy - invest and expand |
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Definition
businesses with relatively low market shares in low-growth industries
BCG growth-share matrix strategy: Divest |
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Definition
businesses in slow growth industries where the company has a strong market share
BCG growth share matrix strategy: Defend and harvest |
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Definition
businesses in high-growth industries where the company has a poor market share
BCG growth-share matrix strategy: Invest and expand or divest |
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Definition
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| Local-responsiveness solution |
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Definition
| Responding to diferences in the markets in all the countries in which a company operates |
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| Global integration solution |
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Definition
| conducting business similarly throughout the world and locating company units whereve there is high quality and low cost |
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Definition
| Choice between a local-resonsiveness or global approach to a multinational's strategies |
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| Multidomestic and transnational strategies |
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Definition
| bipolar reactions to one side of the global-local dilemma |
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| International and Regional Strategies |
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Definition
| Reflect compromises that attempt to balance the conflicting drives |
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Term
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Definition
Emphasizing local-responsiveness issues
A form of differentiation strategy
Not limited to large multinational companies |
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Definition
| Seeking location advantages and gaining economic efficiencies from operating worldwide |
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Definition
| Dispersing value chain activities anywhere in the world where the company can do them best or cheapest |
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Definition
| Country location where a firm can best perform some, but not necessarily all of its value chain activities |
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Definition
That arising from cost quality, or resource advantages associated with a particular nation
nations over other nations |
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Term
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Definition
| Refers to the advantage of individual firms over other firms. |
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Definition
| Selling global products and using similar marketing techniques worldwide |
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Definition
| Managing raw material sourcing, production, marketing, and support activities whitin a particular region |
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Term
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Definition
| conditions in an industry tha tfavor transnational or international strategies over multilocal or regional strategies |
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Term
| Categories of Globalization Drivers |
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Definition
| Markets, costs, governments, competition |
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Term
| Questions about Global Markets |
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Definition
Are there common Customer needs?
Are there global customers?
Can you transfer marketing? |
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| Globalization Driver Questions about Costs |
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Definition
Are there global economies of scale?
Are there global sources oflow-cost raw materials?
Are there cheaper sources of highly skilled labor? |
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| Globalization Drivers Questions about Governments |
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Definition
Do the targeted countries ahve favorable trade policies?
Do the target comuntires have regulations that restrict operations? |
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| Globalization Drivers Questions for Competition |
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Definition
What strategies do your competitors use?
What is the volume of importa and exports in the industry? |
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Definition
| Options mulit-nationanl companies have for entering foreign markets an d countries |
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Term
| Participation Strategies include |
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Definition
| exporting, licensing, strategic alliances, and foregin direct investment |
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Term
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Definition
| Treatinga nd filling overseas ordeers like domestic orders |
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Term
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Definition
| Intermediary or go-between firms provide the knowledge and contacts necessary to sell overseas |
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| Export Management Company (EMC) |
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Definition
| Intermediary specializing in particular types of products or particular coutnries or regions |
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| Export trading company (ETC) |
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Definition
| Intermediary similar to EMC, but it usually takes title to the product before exporting |
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Definition
| Exporters take on the duties of intermediaries and make direct contact with customers in the foreign market |
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Term
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Definition
| Contractual agreement between a domestic licenser and a foreign licensee. (Licenser usually has a valueable patent, technological know-how, a trademark, or a company name that it provides to the foreign licensee.) |
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| International Franchising |
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Definition
| Comprehensive licensing agreement where the franchiser grants to the franchisee the use of a whole business operation |
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Definition
| Producing products for foreign companies following the foreign companies' specifications |
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Definition
| Mulitnational company makes a project fully operational and trains local managers and workers before the foreign owener takes control |
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| International Strategic Alliance |
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Definition
| Agreement between two or more firms from different countries to cooperate in any value chaine activity from R&D to sales |
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| Foreign Direct Investment (FDI) |
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Definition
| Mulitnational firm's ownership, in part or in whole, of an operation in another country |
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Term
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Definition
| Starting foreigh operations from scratch |
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| Disadvantages of Licensing |
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Definition
Gives up control
May create a new competitor
Low income usually results
Opportunity costs for licensing |
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Definition
| The impace of political decisions or events on the business climate ina country such that a mulit-national profitability and feasibility of its global operations are negatively impacted |
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Definition
Greater control of product marketing and strategy
Lower costs of supplying
Avoiding import quotas on raw materials
Greater ooportunity to adapt products to local market
Better local image
Better after-market share
Greater potential profits |
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