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Exam 8: Global Strategy

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Question 81

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Embracing the global marketplace is important to Starbucks because it commands less that one percent of the global coffee market suggesting that there is room for growth. (Chapter 8 Opening Case)

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Question 82

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The "liability of foreignness" will have a greater negative impact on a firm using a multidomestic strategy than on a firm using a global strategy.

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Question 83

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According to the Chapter 8 Strategic Focus, Starbucks' international strategy for success in China is a cost leadership business-level strategy coupled with a multidomestic corporate-level strategy.

Some of the costs incurred by firms pursuing international diversification may derive from higher coordination expenses, trade barriers, and lack of familiarity with local cultures.

Four types of distances are associated with the liability of foreignness: cultural, administrative, geographic, and economic.

The "regionalization" environmental trend means that firms can focus on a region (customization) but also have some standardization or sharing within the region.

If conflict in a strategic alliance or joint venture is not manageable, a(n) _______may be a better option.

In France, fine dressmaking and tailoring have been a tradition predating Queen Marie Antoinette. Cloth manufacturers, design schools, craft apprenticeship programs, modeling agencies, and so forth, all exist to supply the clothing industry. This is an example of the ____ in Porter's model.

Michael Porter's Determinants of National Advantage describe factors associated with the firm's domestic environment that contribute to its dominance in a particular global industry.

Multinational firms have many opportunities to learn from their experiences in international markets, but they must have a strong R&D system to absorb the knowledge.

If intellectual property rights in an emerging economy are not well-protected, the number of firms in the industry is rapidly growing, and the need for global integration is high, ____ is the preferred entry mode.

Having substantial supplies of critical basic natural resources is a necessary condition for a country to support businesses which can successfully compete in international markets.

A company that chooses a truly global corporate-level strategy assumes that the liability of foreignness will be minimal.

Firms able to standarize the processes used to produce, sell, distribute, and service their products across country borders enhance their ability to

Export, licensing, and the strategic alliance entry modes are also appropriate when firms want to establish a strong presence in an international market.

The three basic benefits of international strategies are 1) increased market size; 2) increased economies of scale and learning; and 3) development of competitive advantages through location.

What are the incentives for firms to use international strategies? What are the three basic benefits firms can derive by moving into international markets?

The greenfield venture option is useful when control of proprietary technology is important in an international expansion.

U.S. cola companies entered the global market because of

South Korea's success in international markets is primarily a result of its abundant natural resources.