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International Strategy. Procter & Gamble Pan-European Brand Development. No problem taking a sack. I’ll just use Vizir after the game. Gotta keep this sweaty Tarheel off my clean uniform … I’m out of Vizir . . P&G Multidomestic Strategy. UK. Neth. France. Germany. Italy.

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Presentation Transcript
slide3

No problem taking a sack.

I’ll just use Vizir

after the game.

p g multidomestic strategy
P&G Multidomestic Strategy

UK

Neth.

France

Germany

Italy

product characteristics map
Product Characteristics Map

High Washing Temp

Enzymatic

Stain

Removers

Fabric

Softener

Bleach

Additives

product characteristics map1
Product Characteristics Map

High Washing Temp

Excluded

countries

Italy

Italy

Enzymatic

Stain

Removers

Fabric

Softener

Spain

Bleach

Additives

p g transeuro strategy
P&G “TransEuro” Strategy

UK

Neth.

Zone 1

France

Germany

Spain

Italy

Zone 2

epilogue
Epilogue
  • VIZIR was precursor to “Liquid Tide” in US
    • Great irony is: P&G’s struggle to develop “Euro-brand” first found success in another large, integrated market…the U.S.
    • The VIZIR experience facilitated learning/cross-fertilization w/in P&G worldwide
    • Developed “world-class” technology and product development capabilities worldwide
industry globalization
Industry Globalization
  • What is a global industry? Why?
  • Which drivers/factors most important?
  • How does a global industry compare with a multi-domestic one?
  • How is the extent of globalization “measured”?
  • What are the implications for firms’ international strategies?
globalization drivers
Globalization Drivers
  • Market Drivers
  • Cost Drivers
  • Government Drivers
  • Competitive Drivers

High

Global

Low

Multi-domestic

definitions
Definitions

Multi-domestic

  • Many-country view of the international marketplace
  • Value chain activities are performed in the local country-market and are adapted to local tastes, preferences, needs, etc.
definitions1
Definitions

Global

  • A whole world-level view of the international marketplace, the world is the market
  • Value chain activities are standardized and are performed in country locations according to efficiency, favorable policies, knowledge, resources, etc.
definitions2
Definitions

Transnational

  • A “glocal” level view of the international marketplace – has some global, some local elements
  • Some value chain activities are standardized and are performed in country locations others are nationally-adapted and performed in the local market
market globalization drivers
Market Globalization Drivers
  • Common customer needs
  • Global customers
  • Global market channels
  • Transferable marketing
strength of market drivers
Strength of Market Drivers

Aircraft

Computers

Automobiles

Soft Drinks

Toothpaste

Retail Banking

Book Publishing

Baked Goods

Low

High

Multidomestic

Global

cost globalization drivers
Cost Globalization Drivers
  • Global scale economies
  • Sourcing efficiencies
  • Factor of production differences
  • High product development costs
  • Rapidly changing technology
strength of cost drivers
Strength of Cost Drivers

Pharmaceuticals

Aircraft

Computers

Automobiles

Toothpaste

Retail Banking

Baked Goods

Soft Drinks

Low

High

Multidomestic

Global

government globalization drivers
Government Globalization Drivers
  • Unrestrictive trade and investment policies
  • Compatible technical standards
  • Common marketing regulations
strength of government drivers
Strength of Government Drivers

Toothpaste

Baked Goods

Soft Drinks

Computers

Automobiles

Pharmaceuticals

Airlines

Retail Banking

Restrictive

Loose

Multidomestic

Global

competitive globalization drivers
Competitive Globalization Drivers
  • High two-way trade / cross-border FDI
  • Global competitors
  • Interdependence among countries
    • Trade/Investment Policies
    • Role of WTO, etc.
strength of competitive drivers
Strength of Competitive Drivers

Aircraft

Pharmaceuticals

Computers

Toothpaste

Automobiles

Soft Drinks

Retail Banking

Baked Goods

Low

High

Multidomestic

Global

international strategy1
International Strategy
  • Globalization drivers – Assess dual pressures:
    • Global efficiency - standardization
    • National/local responsiveness - adaptation
  • Location/configuration of value-creating activities
  • Integration/coordination of value-creating activities
effective standardization
Effective Standardization

Coca-Cola’s

“transnational polar bears”

McDonald’s

“Big Mac”

effective adaptation
McMutton Pie in Australia

Wendy’s shrimp sandwich in Japan

Campbell’s non-condensed soups in the UK

Coca-Cola’s 175 ml containers in Japan

Effective Adaptation
barbie
Barbie is 51years old

Sold in 130 countries

National adaptations:

Physical features

Costumes

Activity sets

Standardized physique:

Scaled to 6’2”, 110 lbs.

Barbie
globalization drivers1
Globalization Drivers
  • Market Drivers
  • Cost Drivers
  • Government Drivers
  • Competitive Drivers

High

Global

Low

Multidomestic

international strategy managing dual pressures
International Strategy:Managing Dual Pressures

High

Pressures for Global Efficiency

Low

Low

High

Pressures for Local Responsiveness

value chain location and standardization adaptation
Value ChainLocation and standardization/adaptation

Infrastructure

Technology Development

Procurement

Human Resource Management

Profit

Margin

Inbound

Logistics

Outbound

Logistics

Service

Operations

Marketing

value chain
Value Chain

Headquarters

Infrastructure

Technology Development

Procurement

Human Resource Management

Profit

Margin

Inbound

Logistics

Outbound

Logistics

Operations

Marketing

Service

value chain1
Value Chain

Headquarters

Infrastructure

Technology Development

Procurement

Human Resource Management

Profit

Margin

Inbound

Logistics

Outbound

Logistics

Operations

Marketing

Service

Upstream

value chain2
Value Chain

Headquarters

Infrastructure

Technology Development

Procurement

Human Resource Management

Profit

Margin

Inbound

Logistics

Outbound

Logistics

Operations

Marketing

Service

Upstream

Downstream

value chain sub functions marketing
Value Chain Sub-functions (Marketing)

Infrastructure

Technology Development

Procurement

Human Resource Management

Profit

Margin

Inbound

Logistics

Outbound

Logistics

Operations

Marketing

Service

Advert.

Distrib.

Packaging

Pricing

value chain configuration
Value Chain Configuration
  • Geographic location of value chain activities
    • Concentrated/centralized vs. dispersed/decentralized
value chain coordination
Value Chain Coordination
  • Cross-border linkages between dispersed value-creating units
  • Coordination = Flows of:
    • $
    • Product (finished and intermediate)
    • Technology
    • People
    • Information (market data, strategic direction, etc.)
  • Highly coordinated vs. only money flows
international strategy managing dual pressures1
International Strategy:Managing Dual Pressures

High

Pressures for Global Efficiency

Export

Strategy

Low

Low

High

Pressures for Local Responsiveness

international strategy managing dual pressures2
International Strategy:Managing Dual Pressures

High

Pressures for Global Efficiency

Export

Strategy

??

Multidomestic

Strategy

Low

Low

High

Pressures for Local Responsiveness

multidomestic strategy
Multidomestic Strategy

Germany

U.S.

Mexico

Malaysia

international strategy managing dual pressures3
International Strategy:Managing Dual Pressures

High

Global

Strategy

Pressures for Global Efficiency

Export

Strategy

??

Multidomestic

Strategy

Low

Low

High

Pressures for Local Responsiveness

global strategy textbook variety
Global Strategy(Textbook Variety)

Germany

U.S.

Mexico

Malaysia

international strategy managing dual pressures4
International Strategy:Managing Dual Pressures

High

Global

Strategy

Transnational

Strategy

Pressures for Global Efficiency

Export

Strategy

??

Multidomestic

Strategy

Low

Low

High

Pressures for Local Responsiveness

transnational strategy v 1
Transnational Strategy (v.1)

Germany

U.S.

Mexico

Malaysia

transnational strategy v 2
Transnational Strategy (v.2)

Germany

U.S.

Mexico

Malaysia

transnational strategy v 3
Transnational Strategy (v.3)

Germany

Engines

U.S.

Steel

Mexico

Final

Assembly

Malaysia

Trim, seats,

glass

vw international strategy jetta
VW International Strategy - Jetta

U.S.

Japan

Marketing

Transmission

Mexico

Final

Assembly

Germany

Misc.

Poland

Engine

hamburger university curriculum
Hamburger University Curriculum
  • 80 classroom hours
  • Topics – Fast food “the McDonald’s way”
    • Restaurant operations, food preparation
    • Crew selection, training and team building
    • Marketing and promotion
    • Asset management
    • Corporate citizenship and ethics
    • Leadership, effective supervisory skills
hamburger university1
Hamburger University

Hong-

Kong

London

Illinois

Munich

Sydney

mcdonald s transnational strategy
McDonald’sTransnational Strategy

Singapore

U.S.

Greece

Brazil