BUSI 3103 Chapter 6: Chapter 6
4 May 2017
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Document Summary
Motivations for global expansion: economies of scale and scope (product variety), low-cost. International investment stage 1: new product(fresh idea or business, produce locally) International investment stage 2: maturing product(target 2 or 3 countries, thinking expansion) International investment stage 3: standardized product (stable demand, cost containment, produce globally) Other ways of internationalization: mgmt contracts, strategic alliances/joint ventures, International development stage 1: domestic(locally oriented, initial foreign involvement, domestic structure and export department) International development stage 2: international(export oriented, competitive positioning, domestic structure with international department, multi-domestic) International development stage 3: multinational(multinational, explosion, worldwide product) International development stage 4: global(global, matrix, transnational, whole world) Globalization strategy: product design, manufacturing and marketing are standardized around the world. Multi-domestic strategy: competition in one country is handled independent of competition in other countries. International division structure: organized based on geographic interests and has an export strategy. Global product structure: product divisions are responsible for global operations and has a globalization strategy.
