Managing Internationalization Process International Business Strategy 301LON DO NOT ADD FURTHER SLIDES TO THIS PACK SAVE FILE USING THE FOLLOWING FORMAT: MODULE CODE UNIT NUMBER.PPT (E.G. LCM001U1.PPT) PLEASE DO NOT CHANGE TEMPLATE OR FORMATTING Unit: 6 Knowledgecast:1

Module Learning Outcomes Demonstrate a sound appreciation of current strategic management concepts Communicate an in-depth understanding of the complexity of the environment and its applications on decision-making process Assess current developments in the organisational environment and alternative responses related to strategy This Knowledgecast focuses on stakeholder power and ethics; how both shape and influence a business’ strategic capability.

INTERNATIONALIZATION TRADING SOURCING INVESTMENTS OTHER VALUE ADDING ACTIVITY ACROSS NATIONAL BORDERS ? This Knowledgecast focuses on stakeholder power and ethics; how both shape and influence a business’ strategic capability.

Evolving Mentality Strategies Emerging from the Integration Responsiveness Global Transnational This Knowledgecast focuses on stakeholder power and ethics; how both shape and influence a business’ strategic capability. International Multinational Refer to U2KI

Internationalization Decisions and Motive Firm’s decision to internationalize Organisational factors Environmental factors Decision maker characteristics Firm specific factors Unsolicited proposals Bandwagon effect Attractiveness of host country Foreign travel a & experience abroad This Knowledgecast focuses on stakeholder power and ethics; how both shape and influence a business’ strategic capability. Firm size e.g VW in China e. g US Telecom. Cpy in Mexico Foreign language proficiency International appeal e. g Ekomate in UK & US e.g Foreign bank in China Decision maker background Personal character

Pre-emption of geographic space Internationalization Process TIMING OF MARKET ENTRY When a firm in approached by a customer When competing firms enter into and important market When market is growing very fast Other key strategic reason for timing-First mover Advantage This Knowledgecast focuses on stakeholder power and ethics; how both shape and influence a business’ strategic capability. Cost advantage Pre-emption of geographic space Technological advantage Differentiation advantage Political advantage 5 generic advantages

Internationalization Process OBTACLES TO INTERNATIONALIZATION OBJECTIVE Liabilities of foreignness difference in norms and rules Liabilities of expansion Problems of increased transportation, communication and coordination Liabilities of smallness resource limitation due to size of organisation Liabilities of newness Level of barriers to entry This Knowledgecast focuses on stakeholder power and ethics; how both shape and influence a business’ strategic capability.

Internationalization Process OBTACLES TO INTERNATIONALIZATION SUBJECTIVE Perception of Managers Psychic Distance The distance that is perceived to exist between characteristics of firm’s home country and a foreign country with which the firm is, or is contemplating doing business or investment Child et al. 2009 ................may be high of low This Knowledgecast focuses on stakeholder power and ethics; how both shape and influence a business’ strategic capability.

Internationalization Process OBTACLES TO INTERNATIONALIZATION Managerial perception of Psychic Distance Cultural differences Geographical distance Language Religion Education /literacy level Level of industrial development Logistics infrastructure Political system Legal system Government regulation This Knowledgecast focuses on stakeholder power and ethics; how both shape and influence a business’ strategic capability.

Internationalization Process Internationalization through decreasing Psychic Distance Stage 1) no regular export activities; Stage 2) export activities via independent representatives or agents; Stage 3) the establishment of an overseas subsidiary; This Knowledgecast focuses on stakeholder power and ethics; how both shape and influence a business’ strategic capability. Stage 4) overseas production and manufacturing units. Johanson and Wiedershiem-Paul, 1975

Internationalization Path Uppsala Model The Uppsala Model suggests that a firm’s international expansion is a gradual process dependent on experimental knowledge and incremental step. It assumes that firms proceed along the internationalization path in the form of logical steps based on gradual acquisition and use of information gathered in foreign market and operations. Market Knowledge Market Commitment Leads to Leads to more Market Knowledge Leads to more Market Commitment This Knowledgecast focuses on stakeholder power and ethics; how both shape and influence a business’ strategic capability. AND SO ON Johanson and Vahlne, 1977

Knowledgecast Summary Demonstrate a sound appreciation of current strategic management concepts Communicate an in-depth understanding of the complexity of the environment and its applications on decision-making process Assess current developments in the organisational environment and alternative responses related to strategy MAXIMUM THREE LEARNING OUTCOMES TO REVIEW: ONE REVIEW SUB BULLET PER LEARNING OUTCOME

Seminar Regular Assignment Group Presentation on Environmental audit

Group Activity Regular Assignment Group Presentation on Environmental audit