参考教程教案li yao lecture 006 strategy and organization 83.pdfVIP

Introduction • Wh tions can managers take to compete more effectively as an international business? • How can firms rease profits through international expansion? • What international strategy should firms pursue? Strategy And The Firm • A firm’s strategy refers to the actions that managers take to attain the goals of the firm • Profitability can be defined as the rate of return the firm makes on its invested capital • Profit growth is the percentage rease i profits over time Strategy And The Firm Expanding internationally can boost profitability and profit growth Value Creation • The value created by a firm is measured by the differenc ween V (the Max price that the firm can charge for that product given competitive pressures) and C (the costs of producing that product) • The higher the value customers ce on a firm’s products, the higher the price the firm can charge for those products, and the greater the profitability of the firm Value Creation Value Creation Profits can be reased by: • adding value to a product so that customers are willing to pay more for it – a differentiation strategy • lowering costs – a low cost strategy • Michael Por rgues that superior profitability goes to firms that create superior value by lowering the cost structure of the business and/or differentiating the product so that a premium price can be charged Strategic Positioning • Michael Por rgues that firms need to choose either differentiation or low cost, and then configure internal operations to support the choice Operations refers to the different value creation activities a firm undertakes. To ize long run return on invested capital, firms must: • pick a viable position on the efficiency frontier • configure