IB12 - Chapter 12 Haga clic para modificar el estilo de...

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Haga clic para modificar el estilo de subtítulo del patrón Chapter 12 The Strategy of International Business
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Introduction What actions can managers take to compete more effectively as an international business? How can firms increase profits through international expansion? What international strategy should firms pursue?
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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 increase in net profits over time Expanding internationally can boost profitability and profit growth
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Strategy And The Firm Figure 12.1: Determinants of Enterprise Value
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Value Creation The value created by a firm is measured by the difference between V (the 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 place on a firm’s products, the higher the price the firm can charge for those products, and the greater the profitability of the firm
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Value Creation Figure 12.2: Value Creation
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Value Creation Profits can be increased 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 Porter argues 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
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Strategic Positioning Michael Porter argues that firms need to choose either differentiation or low cost, and then configure internal operations to support the choice To maximize long run return on invested capital, firms must: pick a viable position on the efficiency frontier configure internal operations to support that position have the right organization structure in place to execute the strategy
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Strategic Positioning Figure 12.3: Strategic Choice in the International Hotel Industry
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Operations: The Firm As A Value Chain A firm’s operations can be thought of a value chain composed of a series of distinct value creation activities, including production, marketing, materials management, R&D, human resources, information systems, and the firm infrastructure Value creation activities can be categorized as primary activities (R&D, production, marketing and sales, customer service) and support activities (information systems, logistics, human resources)
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Operations: The Firm As A Value Chain Figure 12.4: The Value Chain
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IB12 - Chapter 12 Haga clic para modificar el estilo de...

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