Internationalization of the Firm Part 1 Theoretical Foundation

1. A26E00400/Summer 2012 Internationalization of the FirmPart 1 TheoreticalFoundation Firstlecture: Introduction to internationalization

2. • Explanatoryfactors of internationalization • Examination of key theories explaining internationalization and foreigndirectinvestment (FDI) • Internationalizationstrategies and processes (patterns) • New approaches to internationalization (e.g. born globals, globalizinginternationals) • International business operation modes (types and characteristics), their interlink ages and managerial implications • Global sourcing and strategic alliances • Current trends related to internationalization and globalization. Objectives & Contents of the course

3. Read the Syllablescarefully and askifthereareunclearpoints • Gothrougheachsections and ensureyoudonothaveanyproblem with complying • Pay attention to what is expected from you regarding: • Types of assignements and group formation, • Downloading readings and slides, • Understandinginstructions for eachtype of assignments • Examdates • Etc. • Youcanmakeappointment to see me individually to discussanyissuerelating to the course. I lovefeedbacksparticularly the negativeones. Practicalities

4. • Concepts and measures of internationalization • Factors and motives for internationalization • Globalizationimpact • Internationalization/ globalizationapproaches • Case assignments and group division • Readings: - ForeignOperationMethods - Article (1) Luostarinen (1994) Content of lecture

5. Introduction to the followingconcepts • International Firm • GlobalFirm • Multinational Corporation (MNC) • TransnationalFirm • Internationalization/Globalization of the firm • Introducing the why, what, where and how? of the abovetwopoints • Foreignoperations/Entrymodes • Early and recent attempts for addressing them: • Theycomeunderdifferentlablessuch as: • Frameworks, models, patterns, theories and paradigmas Concepts

6. MNC and Transnational

8. Theories of International Trade and Investment

10. • Internationalization of the firms is a process in which the firms gradually increase their international involvement (Johanson & Vahlne, 1977) • By internationalization, it is meant a step-by-step process of international business development whereby a firm becomes increasingly committed to and involved in international business operations through specific (entry modes),and specific products in selected markets. (Luostarinen, 1979/Luostarinen, 1994) • Globalization is understood as a process in which the firm: (a) expands its markets operations geographically from the domestic continent to other continents; and (b) develops towards increasing global alignment of activities across countries, entry operations methods and market offerings Internationalization/ globalization

11. Measurements

12. Measurements

13. • Small, Open and Peripheral location of Finland creates enormous push to go abroad • On the other hand large and opening foreign markets create a strong pull to go abroad • Similarities to Sweden, Denmark, Norway,..but also Austria ,Switzerland,New Zealand,… • Compare with US,France, UK, Germany and other large countries SMOPEC-CHALLENGE

14. Globalizationdrivers and potentials

15. Globalizationdrivers and potentials