国际商务Chap12 Internatinal Business.pptVIP

Case: Global strategy at MTV networks Established in 1987 owned by Viacom Majority of its 2 million viewers outside the United States Unsuccessful at a single Americanized program strategy across Europe Successful when program content was localized 70 % of video content is now local in most markets MTV uses expatriates to transfer the “genetic code” but later uses local employees to understand viewers Ratings increased by more than 700% in India in 1996 advertising revenues by 60 % in Europe Strategy the firm Strategy: actions that managers must take to attain the goals of the firm Main goal usually to maximize long-term profit (П) Profitability defined by return on sales or return on equity Value creation Profit determined by : The amount of value customers place on firm’s goods or services (V) Firm’s cost of production (C) Consumer surplus occurs when price charged by a firm on a good or service is less than value placed on it by a customer Value creation = V-C Two basic strategies to create value and attain competitive advantage according to Porter: Low cost Differentiation strategy Value creation Strategic positioning Firm as a value chain Any firm is composed of a series of distinct value creating activities Primary activities Research development Production Marketing sales Service Support Activities Materials management or logistics Human resource Information systems Company infrastructure Firm as a value chain Strategy in international business Strategy is concerned with identifying and taking actions that will lower costs of value creation and/or differentiate the firm’s product offering through superior design, quality service, functionality, etc. Advantages of global expansion Location economies Cost economies from experience effects Leveraging core competencies Leveraging subsidiary skills Profitability is constrained by product customization and the “imperative of localization”. Location economies Realized by performing a value cr