The Main Arguments of Evolution Theory Free Essays

International Management Prof. dr. Niels Noorderhaven Lecture 1 Agenda †¢ †¢ †¢ 1. We will write a custom essay sample on The Main Arguments of Evolution Theory or any similar topic only for you Order Now 2. 3. Introduction and organizational matters Does â€Å"international† still matter? Conceptual foundations of international business strategy (1) †¢ †¢ Case: Honda in the USA Literature: Textbook chapter 1 (pp 13-33 + 59-62) Team Lectures Niels Noorderhaven Cases Fons Naus Ana Aranda Gutierrez Zhengyu Li Teaching strategy Complementarity of lectures – readings †¢ Individual case participation †¢ Each lecture, one or several cases from the book will be expanded to put the theory into practice †¢ Importance of research articles Grading †¢ 70% MC exam – See Study manual for correction formula †¢ Exam dates December 13, 2012 and April 12, 2013 †¢ 30% 2 Interactive lectures – individual participation †¢ Interactive lectures grades of 2010 and 2011 can be transferred Book †¢ http://www. cambridge. rg/features/management/verbeke/ Does â€Å"international† still matter? 7 Transportation communication cos ts fall 17 September 2012 8 Tariffs fall, anti-dumping measures rise anti- 17 September 2012 9 Globalization Theory: †¢ Linguistic, trade and cultural barriers become less important †¢ ‘Stateless’ MNCs †¢ Within MNCs worldwide diffusion of technologies, knowledge and information Convergence of world economies 17 September 2012 10 Why is nationality important to people? Individual identity and social identity †¢ Three processes of social identity formation: †¢ social categorization †¢ social comparison †¢ social identification †¢ (Self-)categorization: what is the salient category? 17 September 2012 11 Why is nationality important to people? †¢ Positive stereotyping of â€Å"in-group†, negative stereotyping of â€Å"out-group† †¢ Nationality differences are particularly salient when people have no common history †¢ Nationality then becomes a source for one’s own identity and for the ascribed iden tity of the other 7 September 2012 12 Does â€Å"international† still matter? Yes, because †¦. †¢ Cultural , institutional and language differences persist †¢ Leading to differences in (business) decision making †¢ Nationality forms an important basis for social categorization processes †¢ Leading to shortcuts like cultural attribution and stereotyping With the effect that doing business across borders is different than domestic business 13 Conceptual foundations of international business strategy 4 Definition of international business strategy International business strategy means effectively and efficiently matching a multinational enterprise’s (MNE’s) internal strengths (relative to competitors) with the opportunities and challenges found in geographically dispersed environments that cross international borders. Such matching is a precondition to creating value and satisfying stakeholder goals, both domestically and internationally. 1 5 TABLE OF CONTENTS (1) Introduction and overview of the book’s framework †¢ Part one: Core concepts (1) Conceptual foundations of international business strategy (2) The critical role of firm-specific advantages (3) The nature of home country location advantages (4) The problem with host country location advantages (5) Combining firm-specific advantages and location advantages in an MNE network 16 TABLE OF CONTENTS (2) †¢ Part two: Functional issues (6) (7) (8) (9) (10) International innovation International sourcing and production International finance International marketing Managing managers in the multinational enterprise 7 TABLE OF CONTENTS (3) †¢ Part three: Dynamics of global strategy (11) Entry mode dynamics 1: foreign distributors (12) Entry mode dynamics 2: strategic alliance partners (13) Entry mode dynamics 3: mergers and acquisitions (14) The role of emerging economies (15a) International strategies of corporate social responsibility (15b) Interna tional strategies of environmental sustainability 18 The seven concepts of the unifying framework †¢ †¢ †¢ †¢ †¢ †¢ Internationally transferable (or non-location bound) firmspecific advantages (FSAs) Non-transferable (or location-bound) FSAs Location advantages Investment in – and value creation through – recombination Complementary resources of external actors Bounded rationality Bounded reliability The MNE’s unique resource base †¢ Physical resources (natural resources, buildings, plant equipment). †¢ Financial resources (equity and loan capital) †¢ Human resources (individuals and teams, entrepreneurial and operational skills). Upstream knowledge (sourcing knowledge, product and process-related technological knowledge). †¢ Downstream knowledge (marketing, sales, distribution and after sales service). †¢ Administrative knowledge (organizational structure, culture and systems). †¢ Reputational resource s (brand names, reputation for honest business dealings). International transferability of FSAs? †¢ Paradox: If the FSA consists of easily codifiable knowledge (i. e. , if it can be articulated explicitly, as in a handbook or blueprint), then it can be cheaply transferred abroad, but it can also be easily imitated by other firms. Though expensive and time-consuming to transfer tacit knowledge across borders, the benefit to the MNE is that this knowledge is also difficult to imitate. It is often a key source of competitive advantage when doing business abroad. Some FSAs are not transferable abroad: location-bound locationFSAs (1) Four main types: †¢ Stand-alone resources linked to location advantages (privileged retail locations). †¢ Local marketing knowledge and reputational resources, such as brand names (may not be applicable to a host country context, or valued to the same extent). Local best practices (i. e. routines), such as incentive systems or buyer-supplier relations (may not work abroad). †¢ Domestic recombination capability (may not work in foreign markets – e. g. , because co-location of resources is needed). Some FSAs are not transferable abroad: location-bound locationFSAs (2) †¢ Even if transferability of the relevant resources were technically possible, this does not mean potential for profitable deployment, i. e. the resource bundles that may be transferable from a technical perspective (e. g. , the way n which a product is marketed at home), do not constitute an FSA abroad. Location advantages †¢ Entire set of strengths of a location, and accessible by firms in that location. †¢ Should always be assessed relative to the strengths of other locations. †¢ Instrumental to FSAs Motivations for foreign expansion †¢ Natural resource seeking – Verbeke: physical, financial or human resources †¢ Market seeking †¢ Strategic resource seeking – e. g. , knowledge, finance †¢ Efficiency seeking – E. g. , low labor cost Case: Honda in the USA Background Prior to 1970s exports of motorcycles and cars †¢ Drivers of foreign production: – Rising value of the yen against US$ – Fear of import restrictions – The Clean Air Act in the US – First oil crisis †¢ Motivation for expansion (natural resource, market, strategic resource, efficiency seeking? ) Honda’s approach †¢ After four-year decision process Honda of America Manufacturing established in Marysville, Ohio, in 1978 †¢ Top priority: attain Japanese-level quality and efficiency – – – – – Selection of employees Training program Fly in managers and workers from Japan Develop lean supplier network Upgrade supplier quality level 1980: start production of cars †¢ Present: 9 production plants in USA Honda’s FSAs †¢ Non-location bound FSAs: – – – – – – – Know-how four-strike engines with optimal power-to-weight ratio Management principles Quality systems Employee selection processes Training and knowledge transfer routines Manufacturing expertise Supplier management approach †¢ †¢ Location-bound FSAs in the host country: – High demand for specific products Resource reco mbination: – – – Use four-strike engines in many products (motorcycles, small cars, generators, †¦) Design and manufacturing skills + knowledge of consumer preferences in USA Melding existing and new resources through management exchange program Exploit new capabilities worldwide Complementary resources of external actors †¢ Opportunity to study American way of production at Ford †¢ Extensive use of American experts and consultants (especially for selecting location) †¢ Critical role of suppliers Bounded rationality issues lack of knowledge local conditions †¢ Suppliers’ lack of familiarity with Honda †¢ New employees lack of familiarity with â€Å"The Honda Way† Bounded reliability issues †¢ Moral hazard/adverse selection employees †¢ American managers have local priorities Deliberate strategy? Agenda for next lecture 1. 2. 3. 4. Four types of MNEs Recombination Bounded rationality reliability Firm-specific advantages (FSAs) †¢ Cases: 3M IKEA †¢ Literature: Textbook chapter 1 (pp 33-76) + chapter 2 NB: Class will be in SZ 31 How to cite The Main Arguments of Evolution Theory, Essay examples