International Business Environment & Strategy

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1 International Business Environment & Strategy Drivers of isation June 2010 Slides based on Yip, G. (1995):- Johnson, Scholes & Whittington (2005) Exploring Corporate Strategy, 7 th edition Robert Jones 2010

2 What is globalisation? Causes? Effects? Pros & cons?

3 market convergence Similar customer needs customers Transferable marketing Government influence Trade policies Technical standards Host government policies strategies Cost advantages Interdependence Competitors global High exports / imports competition Drivers of globalisation Johnson, Scholes & Whittington (2006) Exploring Corporate Strategy, FT Prentice Hall Based on G. Yip, Total Strategy, Prentice Hall, 1995, chapter 2

4 market convergence Similar customer needs customers Transferable marketing strategies Drivers of globalisation

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10 market convergence Similar customer needs e.g. Personal computers Mobile phones i-pod customers Europe Americas Asia Africa Transferable marketing marketing Local adaptation especially with car models

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12 market convergence Similar customer needs customers Transferable marketing strategies Cost advantages Drivers of globalisation

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14 Employees at a call centre in the southern Indian city of Bangalore.

15 market convergence Similar customer needs customers Transferable marketing strategies Cost advantages Interdependence Competitors global High exports / imports competition Drivers of globalisation

16 competition Interdependence alliances car industry - airlines - electronics Competitors global Top firms have #1 / #2 market shares in many nations car makers High exports / imports Many electronic products are made in China Shoes are made in Vietnam Home markets are disappearing

17 Is my Toyota Corolla a Japanese car or?

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19 A global airline alliance:-

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21 market convergence Similar customer needs customers Transferable marketing Government influence Trade policies Technical standards Host government policies strategies Cost advantages Interdependence Competitors global High exports / imports competition Drivers of globalisation Johnson, Scholes & Whittington (2006) Exploring Corporate Strategy, FT Prentice Hall Based on G. Yip, Total Strategy, Prentice Hall, 1995, chapter 2

22 Government influence Trade policies Falling barriers to trade Liberalisation & deregulation WTO / EU and trading bloc policies Technical standards ISO replaces national standards (BS, DIN, ASA) Computer software is international Safety & quality standards:- Pharmaceutical, aviation, automobile sectors Host government policies Sensitivity is needed National differences still exist

23 7th Session of the WTO Ministerial Conference in Geneva 30 November to 2 December 2009

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26 Argentina Australia Brazil Canada China France Germany India Indonesia Italy Japan Mexico Russia Saudi Arabia South Africa Republic of Korea Turkey United Kingdom United States of America

27 market convergence Similar customer needs customers Transferable marketing Government influence Trade policies Technical standards Host government policies strategies Cost advantages Interdependence Competitors global High exports / imports competition Drivers of globalisation Johnson, Scholes & Whittington (2006) Exploring Corporate Strategy, FT Prentice Hall Based on G. Yip, Total Strategy, Prentice Hall, 1995, chapter 2

28 How do these Drivers of isation affect us? Think of the 4 Cs:- Competition is increasing Costs must be reduced constantly Customers are ever more demanding Country differences are still important

29 The 4 Cs of globalisation market convergence Customer Country Similar customer needs customers Transferable marketing Government influence Trade policies Technical standards Host government policies strategies Cost advantages Interdependence Competitors global High exports / imports Cost Competition competition R Jones (2006) - Based on Johnson, Scholes & Whittington (2006) Exploring Corporate Strategy, FT Prentice Hall Based on G. Yip, Total Strategy, Prentice Hall, 1995, chapter 2

30 Sources of Culture Sources of Culture Culture Language/s Nationality Education Profession Ethnic group Religion Family Sex Social class Corporate or organisational culture Based on Usunier (2000) Marketing Across Cultures, Pearson Education Ltd

31 The 5 Cs of globalisation market convergence Culture Country Customer Similar customer needs customers Transferable marketing Government influence Trade policies Technical standards Host government policies strategies Cost advantages Interdependence Competitors global High exports / imports Cost Competition competition R Jones (2006) - Based on Johnson, Scholes & Whittington (2006) Exploring Corporate Strategy, FT Prentice Hall Based on G. Yip, Total Strategy, Prentice Hall, 1995, chapter 2

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33 The 6 Cs of globalisation Culture Country Customer market convergence Similar customer needs customers Transferable marketing Converging technologies, E-business Government influence Trade policies Technical standards Host government policies strategies Cost advantages Interdependence Competitors global High exports / imports Cost Competition competition R Jones (2006) - Based on Johnson, Scholes & Whittington (2006) Exploring Corporate Strategy, FT Prentice Hall Based on G. Yip, Total Strategy, Prentice Hall, 1995, chapter 2

34 The 6 Cs of globalisation Culture Country Customer market convergence Similar customer needs customers Transferable marketing Converging technologies, E-business Government influence Trade policies Technical standards Host government policies strategies Cost advantages Interdependence Competitors global High exports / imports Cost Competition competition R Jones (2006) - Based on Johnson, Scholes & Whittington (2006) Exploring Corporate Strategy, FT Prentice Hall Based on G. Yip, Total Strategy, Prentice Hall, 1995, chapter 2

35

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37 More Cs of globalisation Culture Country Customer market convergence Similar customer needs customers Transferable marketing Converging technologies, E-business Government influence Trade policies Technical standards Host government policies strategies Cost advantages Interdependence Competitors global High exports / imports Cost Competition competition Credit crunch Currency R Jones (2009) - Based on Johnson, Scholes & Whittington (2006) Exploring Corporate Strategy, FT Prentice Hall Based on G. Yip, Total Strategy, Prentice Hall, 1995, chapter 2

38

39 More Cs of globalisation Culture Country Customer market convergence Similar customer needs customers Transferable marketing Converging technologies, E-business Government influence Trade policies Technical standards Host government policies strategies Cost advantages Interdependence Competitors global High exports / imports Cost Common platform Collaboration Competition competition Credit crunch Currency R Jones (2009) - Based on Johnson, Scholes & Whittington (2006) Exploring Corporate Strategy, FT Prentice Hall Based on G. Yip, Total Strategy, Prentice Hall, 1995, chapter 2

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41 More Cs of globalisation market convergence Climate change CO 2 Culture Country Customer Similar customer needs customers Transferable marketing Converging technologies, E-business Government influence Trade policies Technical standards Host government policies strategies Cost advantages Interdependence Competitors global High exports / imports Cost Common platform Collaboration Competition competition Credit crunch Currency R Jones (2009) - Based on Johnson, Scholes & Whittington (2006) Exploring Corporate Strategy, FT Prentice Hall Based on G. Yip, Total Strategy, Prentice Hall, 1995, chapter 2

42

43 More Cs of globalisation market convergence Copenhagen Climate change CO 2 Culture Country Customer Similar customer needs customers Transferable marketing Converging technologies, E-business Government influence Trade policies Technical standards Host government policies strategies Cost advantages Interdependence Competitors global High exports / imports Cost Common platform Collaboration Competition competition Credit crunch Currency R Jones (2009) - Based on Johnson, Scholes & Whittington (2006) Exploring Corporate Strategy, FT Prentice Hall Based on G. Yip, Total Strategy, Prentice Hall, 1995, chapter 2

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