1、GOM 2,Global Strategy Industry Globalization Potential,Globalization,Globalization (Thomas Friedman: Understanding Globalization: The Lexus and the Olive Tree) One overarching featureintegration, the world has become an increasingly interwoven place Defining technologies: computerization, miniaturiz

2、ation, digitization, satellite communications, fiber optics and the Internet Revolving around Moores law German Political theorist Carl Schmidt, the Cold War was a world of “friends” and “enemies”. The globalization world, by contrast, tends to turn all friends and enemies into “competitors”.,Global

3、ization,Built around three balances: The traditional balance between nation-states Between nation-states and global markets (consists of Electrical Herd and Supermarkets) Between individuals and nation-states Everyone now is in everyone elses business Joining the global economy and plugging into EH

4、is the equivalent of taking your country public. Globalization is largely a technology-driven phenomenon, not a trade-driven one.,Globalization,Globalization is more than just Westernization (Frank Griffel): Islamic fundamentalism Globalization and History by Jeffrey Williamson and Kevin ORourke Glo

5、balization also flourished in the 19th c and then faltered. Railroad and steamships, submarine telegraph cables and Suez Canal (1869) all encouraged a huge expansion of trade, global investment and migration. “By 1914, there was hardly a village or town anywhere on the globe whose prices were not in

6、fluenced by distant foreign markets, whose infrastructure was not financed by foreign capital, whose engineering, manufacturing, and even business skills were not imported from abroad.” Governments powerless in face of illegal trade in drugs, arms, intellectual property, people and money.,Globalizat

7、ion,NA intra-regional trade volume 421 billion USD, 6.8% of the global total,European intra-regional trade volume 1,624 billion USD, 26.7% of the global total,Asia-Pacific Intra-regional Trade volume 807 billion USD, 13% of the global total,Trade between EU and Asia-Pacific region 477 billion USD, 7

8、.7% Of the global total,Trade between NA and Asia-Pacific region 652 billion USD, 10.5% of the global total,Trade between EU and NA 469 billion USD, 7.4% of the global total,Balance between Globalization and Regionalization,Strategy,Economic Logic,Staging,Arenas,Vehicles,Differentiators,Where will w

9、e be active? Which product categories? Which market segments? Which geographic areas? Which core technologies? Which value-creation stages?,What will be our speed and Sequence of moves? Speed of expansion? Sequence of initiatives?,How will we obtain our returns? Lowest costs through scale advantages

10、? Lowest costs through scope and replication advantages? Premium prices due to unmatchable service? Premium prices due to proprietary product features?,How will we get there? Internal development? Joint ventures? Licensing/franchising? Acquisitions?,How will we win? Image? Customization? Price? Styl

11、ing? Product reliability?,The Five Major Elements of Strategy,Strategy,Economic Logic,Staging,Arenas,Vehicles,Differentiators,Arenas Inexpensive contemporary furniture Young, white-collar customers Worldwide,Staging Rapid international expansion, by region Early footholds in each country; fill in la

12、ter,Vehicles Organic expansion Wholly owned stores,Economic Logic Economies of scale (global, regional, and individual-store scale) Efficiencies from replication,Differentiators Very reliable quality Low price Fun, nonthreatening shopping experience Instant fulfillment,IKEA Strategy,IKEA is not only

13、 a retailer, but also Maintains control of product design to Ensure the integrity of its unique image And to accumulate unrivaled expertise in Designing for efficient manufacturing An emphasis on low price, fun, contemporary Styling, and instant fulfillment is well suited to The companys focus on yo

14、ung, first-time Furniture buyers.,Key Definitions,Multinational Mentality Management regards overseas operations as a portfolio of independent business,Decentralized Federation Many key assets, responsibilities, and decisions decentralized,Personal Control Informal HQ-sub relationships overlaid with

15、 simple financial controls,Multinational Organization Model,Build strong local presence through sensitivity and responsiveness to national differences Unilever and Philips,Key Definitions,International Mentality Management regards overseas operations as appendages to a central domestic corporation,C

16、oordinated Federation Many assets, resources, responsibilities, and decisions still decentralized, but controlled from headquarters,Administrative Control Formal management planning and control systems allow tighter HQ-sub linkage,International Organization Model,Build cost advantages through centra

17、lized global scale operations P&G and Ericsson,Key Definitions,Global Mentality Management treats overseas operations as delivery pipelines to a unified global market,Centralized Hub Most strategic assets, resources, responsibilities, and decisions centralized,Operational Control Tight central contr

18、ol of decisions, resources, and information,Global Organization Model,Exploits parent company knowledge & capabilities through world-wide diffusion and adaptation Matsushita and NEC,Key Definitions,Organizational Characteristics of Multinational, Global, and International Companies,Recent Changes in

19、 General Globalization Drivers,Market Drivers Per capita income converging among industrialized nations Convergence of lifestyles and tastes Increasing travel creating global consumers Organizations beginning to behave as global customers Growth of global and regional channels Establishment of world

20、 brands Push to Develop global advertising Spread of global and regional media Cost Drivers Continuing push for economies of scale Accelerating technological innovation Advances in transportation Emergence of newly industrialized countries with productive capability and low labor costs Increasing co

21、st of product development relative to market life,Recent Changes in General Globalization Drivers,Government Drivers Reduction of tariff and non-tariff barriers Creation of trading blocs Strengthening of world trade institutions Decline in role of governments as producers and customers Privatization

22、 Shift to open market economies from close communist systems Increasing participation of China and India in the global economy Competitive Drivers World trade increase More countries becoming key competitive battlegrounds Increased ownership of corporations by foreign acquirers Rise of new competito

23、rs intent upon becoming global competitors Growth of global market networks making countries interdependent in particular industries Internet impact More companies becoming globally centered Increased formation of global strategic alliances,Diagnosing Industry Globalization Potentials,Market Globali

24、zation Drivers,Aircraft (Civil),Computers,Credit cards,Automobiles,Soft Drinks,Specialty Chemicals,Pharmaceuticals (Ethical),Toothpaste,Electrical Insulation,Commercial Banking,Pharmaceuticals (OTC),Booking Publishing,Low,High,Strength of Market Globalization Drivers for Selected Industries,Toyota,

25、Nissan, and Honda chose to focus on fundamental needs common to all countriessuch as reliability and economyrather than to focus on peripheral differencessuch as styling,Market Globalization Drivers,Common customer needs particularly affects the opportunity to use the global strategy levers of globa

26、l market participation, global products and services, and global competitive moves. Service businesses are faced with the challenge of standardization while meeting the needs of a broad cross section of customers around the world. Usually, the less involvement, whether physical or psychological, the

27、 better the opportunity for global approach. Fast food and airlines versus medical care and education,Market Globalization Drivers,Global Customers and Channels: Two types of global customers: National: e.g. national defense agencies Multinational: WHO, Automotive OEMs Influencers: physicians who pr

28、escribe drugs, architects who specify building materials Global pricing policies Global channels are rare, but regionwide ones are increasing in numbers: Wal-Mart with $137 b in 9 countries, Japans 7-Eleven with $35 b in 18. Regional customers are probably growing at a faster pace than global custom

29、ers, particularly in Europe,Market Globalization Drivers,Transferable Marketing: Brand names and advertising are readily transferable. Lead countries: Japan is a lead country for consumer electronics Germany for industrial control US dominant for global service businesses, setting global trends and

30、standards in chain restaurants, hotels, entertainment them parks, health care, delivery services, car rentals.,Cost Globalization Drivers,Aircraft (Civil),Computers,Credit cards,Automobiles,Soft Drinks,Specialty Chemicals,Pharmaceuticals (Ethical),Toothpaste,Electrical Insulation,Commercial Banking,

31、Pharmaceuticals (OTC),Booking Publishing,Low,High,Strength of Cost Globalization Drivers for Selected Industries,Cost Globalization Drivers,Global Economies of Scale and Scope Unilever, P a new super-jumbo $10 b (for the Airbus A380) Fast-Changing Technology,Government Globalization Drivers,Aircraft

32、 (Civil),Computers,Credit cards,Automobiles,Soft Drinks,Specialty Chemicals,Pharmaceuticals (Ethical),Toothpaste,Electrical Insulation,Commercial Banking,Pharmaceuticals (OTC),Booking Publishing,Low,High,Strength of Government Globalization Drivers for Selected Industries,Government Globalization Drivers,Favorable Trade Policies Japanese auto OEMs move to the US EU for banking and financial services: Deutsche Bank Compatible Technical Standards Motorolas fight with Japanese standards Common Marketing Regulat