International Business International Business Strategy (IBS)Strategy (IBS) -a -a

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Strategies Desired future

BEST STRATEGY*

Present situation

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IBS: how firms compete in internationally competitive markets

–needs: horizontal linkage of various narrow disciplines

–holistic approach: IBS eclectic, cross-disciplinary*

•Integrated approach to IBS

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Contrasting paradigmsa) External context (Porter): => WHY?WHY? environment, competitors competitive advantageb) Resource-based approach (Hamel-Prahalad) =>

WHAT?WHAT? firm specific resources forward lookingc) Process view (Mintzberg, Waters) =>HOW?HOW? management: process of change actions, interactions*

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a) External context: market specificStrategic ChangeStrategic Change: prescriptive adjustment

to external change factors (market, competitors)

Integrated approach, international aspect,SWOT

IBSIBS

International business

Strategic management

International finance

Organizational development

International marketing

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b) Resource-based approach: firm specific

Internal firm-basedfirm-based perspective

Competitive advantage: depend on

- resources

- capabilities

- Competencies

FForward looking

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c) Process viewHOW IBS developed?HOW IBS developed?

complexity, ambiguity

process of change + organizational context

how change affects

– actions

– reactions

– interactions of people within organization

Merge different complementary strands of thinking!*

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strands

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Rope metafore

While strands separated, they are interrelated

From a distance: they are not distinguisable - outcome is not prescriptive

It can be unravelled:

lack of fit between assumptions

Length: real time

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Strategic approachStrategic approach

WHY to develop an international business in a competing environment?

WHAT is the content of strategy

(resources, core competencies, anticipated performance, time scale)

HOW development to be achived? Configure resources! Managers? Motivation? Monitoring? Evaluating?

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International Business Strategy is concerned

with the strategic management processprocess, by which

firms of all sizefirms of all size evaluate their changing international business environment and

shape an appropriate organizational responseresponse that

involves the crossingcrossing of international borders.

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Spatial perception of competitive Spatial perception of competitive opportunities and threatsopportunities and threats

– board members– competitors– SWOT– moving headquarters

Costumer baseCostumer base– all customers equidistant

Scope and complexityScope and complexity– discontinuity: resource, managers– greater complexity– compatibility with market requirements

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How increasing complexity does relate functional areas?

• Marketing

• Logistics

• Finance

• Human resource management

• Operations

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How functions at Ford

were changed

according to increasing

environmental complexity?

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The nature of strategyThe nature of strategy

• strategy: difficoult to define

• Mintzberg:

PATTERN

PLAN

POSITION

PERSPECTIVE

PLAN:

Takes the future into account and firm follows the plan

Difficoulties in prediction

POSITION:

How products and services positioned on a market?

An external contextual view of strategy

PERSPECTIVE:

Internal view

Organization’s way of doing: people, processes

PATTERN:

Consistent pattern of behaviour

How a firm operates?

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Strategy developmentStrategy development

Unrealized strategy

Emergent strategies

Realized strategies

Deliberate strategies