16 terms

Chapter 8 -- Ward

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Terms in this set (...)

International Strategy
Selling products in markets outside of the firm's domestic market to expand the market for their products.
Multidomestic Strategy
International strategy in which strategic and operating decisions are decentralized to the strategic business unit in each country in order to tailor products and services to the local market. Need for global integration is low, but there is great need for local market responsiveness.
Global Strategy
An international strategy in which a firm's home office determines the strategies business units are to use in each country or region. When the need for global integration is high and there is little need for local market responsiveness.
Transnational Strategy
An international strategy through which the firm seeks to achieve both global efficiency and local responsiveness. When there is a great need for both global integration and local market responsiveness.
Exporting
Entry mode though which the firm sends products it produces in its domestic market to international market.
Licensing
An entry mode in which an agreement is formed that allows a foreign company to purchase the right to manufacture.
Strategic Alliances
Finds a firm collaborating with another company in a different setting in order to enter one or more international markets.
Cross-border Acquisition
An entry mode through which a firm from one country acquires a stake in or purchases all of a firm located in another country.
Greenfield Venture
An entry mode through which a firm invests directly in another country or market by establishing a new wholly owned subsidiary. Most costly and complex of all international market entry alternatives.
Political Risks
Denote the probability of disruption of the operations of multinational enterprises by political forces or events whether they occur in host countries, home country, or result from changes in the international environment. Those related to instability in national governments and to war, civil or international.
Economic Risks
Fundamental weaknesses in a country or region's economy with the potential to cause adverse effects on firms' efforts to successfully implement their international strategies.
International Diversification Strategy
A strategy through which a firm expands the sales of its goods or services across the borders of global regions and countries into a potentially large number of geographic locations or markets.
Factor Conditions or Factors of Production
The inputs necessary to compete in an industry. These include labor, land, natural resources, capital and infrastructure.
Demand Conditions
Characterized by the nature and size of buyers' needs in the home market for the industry's products or services. The size of the segment can create demand sufficient to justify the construction of scale-efficient facilities.
Related and Supporting Industries
Third factor of the national advantage model. National firms may be able to develop competitive advantage when industries that provide either materials or components or that support the activities of the primary industry are present.
Firm Strategy, Structure, and Rivalry
Growth in certain industries is fostered by the fourth factor. Patters of firm strategy, structure, and competitive rivalry among firms in an industry vary between nations.