Upload
ashok-sharma
View
213
Download
0
Embed Size (px)
Citation preview
8/19/2019 Designing a global strategy.pptx
1/24
Designing a global
strategy
8/19/2019 Designing a global strategy.pptx
2/24
Framework for GlobalStrategy
• A global strategy is the way a company denes itslong-term objectives for the world market
• Selects its value proposition for the world market
• Builds integrates and co-ordinates its businesssystem to gain and sustain a global competitiveadvantage
• !uts in place an organisation to manage itsoperations worldwide
• Four major components" – A global strategic ambition
– A global strategic positioning
– A global business system
– A global organisation#
8/19/2019 Designing a global strategy.pptx
3/24
Global strategy framework
8/19/2019 Designing a global strategy.pptx
4/24
Global ambition
• $%presses the role a company wants to play inthe world marketplace
• &ow it views the future distribution of its sales
and assets in the key regional clusters of theworld
• Firms can play ve types of role" – Global player
–
'egional player – 'egional dominant global player
– Global e%porter
– Global operator#
8/19/2019 Designing a global strategy.pptx
5/24
Global ambition
• Global player aspires to establish a sustainablecompetitive position in the key markets of the worldand to build an integrated business system of designsspread over those key markets
–
$%ample" Sony (nilever $ricsson Alcatel )otorola Shell*ero% +anon !rocter , Gamble +itibank etc#
• Regional player denes its role as to capture a strongcompetitive advantage in one of the key regions of theworld
– $%ample" !eugeot $+ Barclays
• A Regional dominant global player is a companywhose role is more than regional player but it is not yetselling across the key markets of the world#
8/19/2019 Designing a global strategy.pptx
6/24
Global ambition• A Global exporter is company whose role is to sell across
the key markets of the world products manufactured orservices operated in its home country
• .hey build foreign operations only to support the e%portdrive
– $%amples" )ajor aerospace or defense companies like BoeingAirbus 'aytheon etc#
• A Global operator is a company that procures a largefraction of its product components in factories locatedoutside its base market and which concentrates its sales in
its domestic market • )any managerial issues of integration and co-ordination of
activities both in-house factories or long-termsubcontracting
• Firm/s distribution of sales assets and personnel should belooked at in order to assess the degree of global ambition
8/19/2019 Designing a global strategy.pptx
7/24
Global ambition
• .he e%tent to which a company has followed a globalambition one can usefully utilise two globalisation indices"
– Global Revenue Index 0G'12" the ratio of the companydistribution of sales in the major world regions to the industrydistribution of demand in the same regions
– A company whose sales distribution matches the e%actdistribution of its industry market would have a G'1 of 344 percent#
– Global Capability Index 0G+12" the ratio of the companydistribution of assets for capital intensive industries or personnel
in the major world regions to the industry distribution of demandin the same regions
– 5+apability/ described here is in-house capability not capabilitywhich a rm can ac6uire through e%ternal sourcing likeoutsourcing sub-contracting or strategic alliances
– +ompanies which rely heavily on e%ternal sourcing will have alow G+1 score
8/19/2019 Designing a global strategy.pptx
8/24
)apping of global ambition
8/19/2019 Designing a global strategy.pptx
9/24
)apping of the consumer
electronics industry
8/19/2019 Designing a global strategy.pptx
10/24
Global positioning
• +onsists of two types of choices" – .he choice of countries in which the
company wants to compete and the role
that those countries have to play in theglobal country portfolio
– .he denition of the various value propositions for the product or servicesof the company corresponding to thetype of segments and countries in whichthe company wants to compete
8/19/2019 Designing a global strategy.pptx
11/24
Global positioning
• Key countries: – 7epending on the industries countries di8er in the
opportunities they o8er to companies for their strategicdevelopment
–
Some countries given their si9e growth or the 6uality oftheir human natural or locational resources are criticalfor companies/ long-term competitiveness
– 1n the automobile sectors :apan ;orea and in the future+hina can be considered as key
– 1n the pulp and paper industry in which natural resourcesare a key component of competitive advantage countrieslike 1ndonesia can be considered as key
– +alifornia 0Silicon
8/19/2019 Designing a global strategy.pptx
12/24
Global positioning
• Emerging countries: – +ountries that e%hibit a high growth rate making them
strategically attractive in the near future
– .hey depend on opportunities which are industry-specic
–
+hina 1ndia Bra9il $ast $uropean countries some Africannations
• Platform countries: – +ountries with locational advantage good logistical nancial
regulatory and legal infrastructure or 6ualied personnel can
serve as a 5hub/ for setting up regional centres globalfactories etc
– Singapore &ong ;ong 1reland or .aiwan present thesecharacteristics 0+arrefour used .aiwan as a platform for itsstrategic development in Asia2
8/19/2019 Designing a global strategy.pptx
13/24
Global positioning
• Mareting countries: – .he attractiveness of the market is good without being as
strategically critical as for the key countries
– Such countries should be assessed on its own merits
depending on the political economic and business conte%t – 1ndia +hina with huge middle class population for mass
market products
• !ourcing countries: – +ountries with a strong resource base but limited market
prospects – )alaysia for rubber or Saudi Arabia for petroleum
• A global company will control a portfolio of operationsin these di8erent categories of country
8/19/2019 Designing a global strategy.pptx
14/24
Global positioning
• Value Proposition" 7ened ascustomer/s value attributes that thecompany is o8ering to the market – +hoice of value attributes
– +hoice of customer segments
– +hoice of degree of world
standardisation of the product=serviceo8ering#
8/19/2019 Designing a global strategy.pptx
15/24
Global positioning
• "alue attributes are the elements of the productsor services that customers value when making theirpurchasing decision
– product design functionality performance 6uality
customisation and price the brand the availability andother features
– Dierentiated" proposition based on value-enhancingattributes such as performance 6uality servicecustomisation
– Cost leadership: proposition based on price forstandardised products or services
• +ompany can either position itself as a Globaldi#erentiator or a Global cost leader
8/19/2019 Designing a global strategy.pptx
16/24
Global positioning
• Customer segments are the groups ofcustomers that have similar value curves – +ustomer groups can be identied by income level
geographical location age socio-psychometric
attributes in consumer goods and service industries – 1dentied by industry si9e purchasing behaviour in
B>B industries
• Strategic choice at this level is whether rm
concentrates on one or two customer groups0Focused2
• ?hether rm attempts to embrace many or allcustomer segments 0Broad2
8/19/2019 Designing a global strategy.pptx
17/24
Global positioning
• !tandard vs$ %daptive 0value proposition2 – Firm adopts a similar or standardised value
attribute to the same type of customersegments across the globe 0Standard2
– Firm tries to di8erentiate value attributes andsegments according to the country or regions
– +oca +ola Swatch or S@ have a standardvalue proposition across the globe
– (nilever and !rocter , Gamble adjust theirvalue proposition and their segmentation indi8erent countries
8/19/2019 Designing a global strategy.pptx
18/24
Global positioning
• ustainability of competitive advantage 0 ways2 – +ustomer loyalty
• !ni"ue products or services
• trong brand 0+oca +ola Apple2
• #igh switching costs 0)icrosoft2• $ocked%in#
– !ositive feedbacks• 5success brings success/ and produce increasing returns
– !re-emption of capabilities#• ;ey resources or assets in control of the rm that
competitors will nd diCcult to access or to thedevelopment of competencies that are 5time incompressible/
8/19/2019 Designing a global strategy.pptx
19/24
Global business system
• Business system design consists ofdecomposing the company value chain intoelements that are spread and integratedacross the world 0depends on type of industry2
• major generic components of a value chain – &nnovative activities" ',7 knowledge creation
design
–
Productive activities" procurement manufacturingback oCce operations logistics
– Customer relationship activities" marketing salesdistribution customer services#
8/19/2019 Designing a global strategy.pptx
20/24
Global business system
8/19/2019 Designing a global strategy.pptx
21/24
Globalisation of
8/19/2019 Designing a global strategy.pptx
22/24
Global business system
• 'ole of partnership and strategic alliances inbuilding global capabilities
• Firms need to ac6uire and complement theircapabilities by setting up partnerships
– 'lobal alliances" 'ole is to pool complementingcapabilities to reach world markets or to achieve acritical mass in ',7 0Start Alliance @ne ?orld etcDFre6uently seen in aerospace life sciences oil
e%ploration etc#2 – Partnerships for market entry: :oint ventures
franchises licensing or may be to comply with localgovernment re6uirements 0&ero &onda2
8/19/2019 Designing a global strategy.pptx
23/24
Global organisation
• 7esign of an organisationalarchitecture which is able to supportand implement the global ambition
global positioning and globalbusiness system
•
8/19/2019 Designing a global strategy.pptx
24/24
Global organisation