Professional Documents
Culture Documents
Chapter :4
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Opening Profile
A. Malachi Mixon, III. Creativity, risk taking and innovation in entrepreneurship are essential not only to the inception of new products and ventures, but also to a firms successful transition into global markets. Invacare traces its existence in 1895 The firm was involved in manufacturing business of vehicles especially designed for the physically challenged. The case of Mal Mixons notable revitalization of tiny Invacare Corporations exemplifies the connection of globalization. Page 83
3/15/2014 Entrepreneurship -6th Edition Lecture prepared by Madam Amina Sadaf 2
Balance of payment
Type of System
There are many difficulties in doing business in developing and transition economies. Problem reflect gaps business plans, product promotion, marketing, accounting systems etc. Barter trading or Third party arrangements.
Page 87-88
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Strategic Issues
Four strategic issues are of importance to an entrepreneur going international:
The allocation of responsibility between the local and foreign operations. The nature of planning, reporting and control system to be used throughout the international operations. The appropriate organizational structure for conducting international operations. The degree of standardization possible.
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Strategic Issues
Problems of allocation of responsibility between headquarters and subsidiaries concern the degree of decentralization. This responsibility occurs in 3 stages:
Stage 1:
Making his first movements in the international business , an entrepreneur typically follows a highly centralized decision-making. When the business is successful, entrepreneur decentralizes the whole operations. The process of decentralization becomes intolerable once further success is attained. How ? Business operations in the different countries end up in conflict with each other. The balance is maintained when headquarters (base) have reasonable control over major strategic marketing and in-country have the responsibility of tactical implementing strategy.
Page 90
Stage 2:
Stage 3:
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Strategic Issues
What is required to for effective planning, reporting and control in international operations.
Environmental Analysis. Strategic Planning. page 90-91
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Strategic Issues
The appropriate organizational structure.
Organization level. Human resources and skilled labour.
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Strategic Issues
Operational planning
What products should be marketed, at what price, through what channels.
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Direct Exporting
Selling good to another country by taking care of the transaction. Page 92-93
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Joint ventures
Two companies forming a third company. Concept of synergy? Two parties having things in common.
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