International Management (Subject) / Project & Cases, Strategies & Leadership (Lesson)

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• How will you define International Business Strategy? - matching a multinational enterprises (MNE's) internal stregnth  - with the opportunities and challenges found in geographically environments - creating value and satisfy stakeholder goals, both domestically and internationally
• What are MNE functional issues? - International innovation - International sourcing and production  - Internation fincance - International marketing - managing managers in the multinational enterprise 
• The seven concepts of the unifying framework (The essence of international business strategy) 1. Internationally transferable (or non-location bound) firm-specific advantages (FSAs) 2. Non-transferable (or location-bound) FSAs  3. Location advantages 4. Investment in- and value creation through- recombination 5. Complementary resources of external actors 6. Bounded rationality 7. Bounded reliability  => The triangular shape in the model represents the pyramidial nature of the firms advantes: on the broad base of the location advantes of its home country (left), it builds a smaller subset of FSAs that are location-bound, and then a still smaller subset that are non-location bound (right). Bounded rationality and bounded reliability influence the ability of these non-location bound FSAs to be transferred across the international border to the host country. 
• What are the elements of 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 (orgaizational structure, culture and systems) - Reputational resources (brand names, reputation for hones business dealings) => Building upon its resource base, the MNE will develop stand-alone FSAs (e.g. brand names, patents) and routines => FSAs reflect the firm's distinct strengths vis-à-vis rivals 
• Please define routines in the context of MNEs - the ability to combine further the firm's resources in unique ways valued by the firm's stakeholders - routines are stable patterns of decisions and actions that coordinate the productive use of resources and generate value, whether domestically or internationally  - the combination ability expressed in routines is a higher-order FSA  - case example: Federal Express 
• Forms of market entry barriers 1) Institutional market entry barriers- Governmental regulations, e.g., tariffs, permits, shareholding limits, local content regulations. 2) External market entry barriers - Barriers originating in the market structure, e.g., problematic access to distribution netwroks, difficult recruitment, discrimination by state autohorities, cultural differences, customer prefer local suppliers.  3) Internal market barriers - Barriers originating in the enterprise, e.g., lack of competences, high costs of adapting products to customer requirements, lack of resources.
• Political Risks = Likelihood that a society will undergo political change that negatively affects local business activity  - Conflict and violence - Terrorism and kidnapping - Property seizure: Confiscation, Expropriation, Nationalization - Corruption - Policy Changes - Local content requirements - Cyberthreats
• How to manage political risks? 1) Adaption 2) Information Gathering 3) Political Influence The four core competencies:  Understand, Analyze, Mitigate, Respond 
• What are motivations for foreign expansion? - Natural resource seeking- Market seeking- Strategic resource seeking- Efficiency seeking- reactive behavior - result of proactive/aggressive behavior  Internal:- managerial urge- marketign advantages- economies of scale- unique product competence- extend sales of a seasonal prodcut External:- foreign market opportunities - change agents - small home market 
• What are Timing Strategies? Cross border timing:- Waterfall Strategy- Simultaneous Strategy - Combined approach National market-specific timing:- First mover (pioneer)- Early follower - Late follower 
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• What are International Strategies/Systems? 1) Ethnocentric (Home country orientation) 2) Geocrentric (Global orientation) 3) Polycentric (Host country orientation) 
• Define Home Country Location Advantages / Host Country Location Adventes and apply your understanding to Shiseido Home Country Location Advantages:  - raw materials, low labor costs, large domestic market, rivarly etc. = FSAs (Firm specific advantage)- determines a firms innovation capabilities- fragrance market in Japan only 1%, therefore not preapred to be international Host Country Location Advantages:- Shiseido has a global matrix organization whereas different categories specialise in certain countries (e.g.: America: MakeUp & Digital, EMEA: Fragrance, Japan: Skin Care) with the aim to gather information and put forward strategies- france was professional in perfumes - so they did their own operations there in order to learn more about fragrances through aquisitions, new brands, local relationships etc.- hire local expert- non-transferable FSA becomes internationally transferable FSA because of host country operation Japan: Factor condition: lack of domestic fragrance experts & senior management with fragrance business experienceDemand conditions: fragrance market in Japan is very small (1% of the cosmetics market)Related and supporting industries: no high-quality, internationally home-based suppliersFirm strategy, industry structure and rivalry: lack of domestic competitors and experience of managing fragrance business France Factor conditions: ideal place to gain expertiseDemand conditions: 30%-40% of total cosmetics sales in Europe and America; based on France enter the European marketRelated and supporting industries: France is the heart of the international fragrance industry. Shiseido has built local relationships successfully in France.Firm srategy, industry structure and rivalry: Shiseido should compete with many french competitors and other MNEs like L’Oréal Group.
• Define Global HR Management and give key advantages & challenges - component of implmenting global strategy and is recognized as a major determinant of success or failure in interbational business- manging HR in global corporation by having the right people in the right place at the right time, appropriately trained, prepared and supported- ethnocentric (home country orientation), polycentric (host country orientation), geocentric, regiocentric- each staffing policies have its advantages, the best practice depends on the country Advantages:- easily place international staff - to prepare for growth- to offer employees flexibility- to cultivate leadership- to maximize diversity- to ensure compliance Challenges:- cultural differences cause misunderstandings- cross-cultural issues- breaking local laws- communication / feedback- maintaining brand loyalty- leadership development- workforce training and development- recruiting talented employees- balancing local and home issues

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