Exam 8: Global Strategy

A U.S. manufacturer of pigments for household paint that exports about 40 percent of its production to European markets will find its sales will be harmed by a weak dollar.

When a firm initially pursues an international business-level strategy, the resources and capabilities established in the home country frequently allow the firm to pursue the strategy into markets located in other countries.

As nations industrialize, the demand for some products and services such as Starbucks (Chapter 8 Opening Case) becomes more similiar as a result of similar lifestyles in those nations.

In Porter's model, if a country has both ________ and __________ production factors, it is likely to serve an industry well by spawning strong home-country competitors that can also be successful global competitors.

Evidence suggests that, in general, using an international cost leadership strategy when exporting to developed countries has the most positive effect on firm performance while using an international differentation strategy with larger scale when exporting to emerging economies leads to the greatest amounts of success.

A fundamental reason for a country's development of advanced and specialized factors of production is often its

The firm using a global strategy seeks to develop economies of scale as it produces the same or virtually the same products for distribution to customers throughout the world who are assumed to have similar needs.

Which of the following is an advantage associated with greenfield ventures?

Which international corporate-level strategy strategy does Starbucks use? (Chapter 8 Opening Case)

Walmart's most common entry modes into international markets are acquisitions and joint ventures (Chapter 8 Strategic Focus).

All of the following complicate the implementation of an international diversification strategy EXCEPT

In order to preserve its competitive advantage in low-cost operations, Walmart uses only new wholly-owned subsidiaries (greenfields) to enter international markets (Chapter 8 Strategic Focus).

International corporate-level strategy focuses on

In place of relatively stable and predictable domestic markets, firms across the globe find that they are competing in relatively unstable and unpredictable global markets.

The four aspects of Porter's model of international competitive advantage include all of the following EXCEPT

Rivals Airbus and Boeing have multiple manufacturing facilities and outsource activities partly for the purpose of developing economies of scale as a source of being able to create value for customers.

By choosing a region where markets are more similar, the firm may be able to better understand those markets and cater to their needs, but also achieve economies through sharing of resources.

A multidomestic corporate-level strategy has ____ need for global integration and ____ need for local market responsiveness.

Because of the lack of protection of intellectual property in some foreign countries, licensing arrangements are one of the best ways for a firm to protect its technology from being appropriated by potential competitors.

Case Scenario 1: Blast Furnace, Inc., (BFI) Blast Furnace, Inc., (BFI) provides customized development of automated rich-media applications, and scalable solutions that allow media and entertainment companies, as well as enterprises and government organizations, to deploy, manage and distribute video content on IP-based networks. The company was founded in 1997 and went public in 2004; its stock trades on the NASDAQ under the ticker BLST. While providing solutions to a variety of firms and industries in North America, BFI has experienced its fastest growth with the security products that it designs and sells to the U.S. government and U.S. government agencies. This growth is based on its propriety VUE software, which is a complete identification solution for capturing, analyzing, and managing multi-biometric information. Proprietary analysis algorithms aggregate and cross-compare multiple biometrics to increase accuracy and lessen dependence on single identification techniques. Additionally, specialized encoding techniques reduce file size and increase analysis and response times. VUE supports a wide range of applications ranging from ID issuance and verification to gated entry screening for border patrol, airports, government buildings, and corporations. Essentially, VUE is able to sift through massive amounts of digitized multimedia files to create a unified ID dossier of an individual and then identify those individuals rapidly anywhere in the data. Such a capability is of great interest to security organizations, particularly since the World Trade Center bombing, because it allows the user to identify suspects within minutes on a real-time basis anywhere digitized media is being created (like that created by the hidden and visible surveillance cameras in airline terminals, banks, ATMs, and other public locations). Once a suspect is entered into the system, the software is capable of scanning all data sources automatically and without stop. For two years, BFI has had this market to itself but now two new entrants, a Belgian start-up and the subsidiary of a Finnish telecom firm, are staking out positions in large non-U.S. markets like Europe and Asia. BFI's management fears that if it limits its efforts to North America, then these aggressive competitors may eventually develop strongholds in other markets from which they can launch successful attacks on BFI's home turf. -(Refer to Case Scenario 1) Assume that BFI has chosen international expansion. How quickly should it move? Which activities would you recommend BFI to internationalize first?