1. Chapter Two Global Competitive Analysis

2. Theories of International Production The Competitive Environment Rivalry, new entrants, substitutes, buyer and supplier power Country specific advantages - (CSA’s) absolute and comparative, locational International product life cycle Porter’s diamond factors, interaction, government, man-made New trade theory firm specific advantages (FSA’s) Eclectic theory - CSA’s & FSA’s

3. Porter’s Determinants of National Advantage Firm strategy, structure and rivalry Related and supporting industries Demand conditions Factory conditions Source: Adapted and reprinted with the permission of the Free Press, a division of Simon and Schuster, from The Competitive Advantage of Nations, by Michael E. Porter. Copyright © 1990 by Michael E. Porter Exhibit 2.2

4. Internalization Theory Modes of entry export, license, foreign direct investment (FDI) externalization & internalization of FSA’s Transaction cost theory Exporting vs FDI – considerations Global competitors Strength, repertoire, rivalry, hypercompetition

5. FSA’s and Marketing Strategy Production-based vs marketing specific advantage Market orientation vs knowledge/resource- based orientation The value chain and internationaliztion Implementation - incrementalism, emergent Foreign entry, local marketing & global management

6. Value-Added Analysis for Consumer Electronic Products Panasonic Radio Shack ComponentsAssembly Marketing, sales, and distribution Retailing Source: Reprinted from “Designing Global Strategies: Comparative and Competitive Value-Added Chains,” by Bruce Kogut, Sloan Management Review, Summer 1985, pp. 27-38 by permission of publisher. ©1985 by the Sloan Management Review Association. All rights reserved Exhibit 2.4

7. Porter’s Value Chain

8. Chapter Terms and Essay Terms CSA, FSA, benchmarking, value chain, integrated competitive move Essay How do CSA’s and FSA’s help explain where processes are performed in global marketing operations and by whom?

9. Quality or Else Video How are quality and customer satisfaction related, according to the managers in this video? What firm-specific advantages (FSA's) are these firms seeking? Why are global operations necessary for the achievement of these FSA's? How are the countries in this video pursuing country-specific advantages within the context of Porter's diamond?

10. Chapter Two Global Competitive Analysis