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Exam 8: International Strategy

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Question 61

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South Korea's success in international markets is primarily a result of its abundant natural resources.

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B) False

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Question 62

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A multidomestic strategy is an international strategy in which strategic and operating decisions are decentralized to the strategic business units in individual or regions.

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Question 63

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A multidomestic strategy is an international strategy in which a firm's home office determines the strategies business units are to use in each region.

Which pair of industries would NOT be considered as "related and supporting" under Porter's diamond model?

The "regionalization" environmental trend means that firms can focus on a region (customization) but also have some standardization or sharing within the region.

Which of the following is NOT a disadvantage of international acquisitions?

Four types of distances are associated with the liability of foreignness: cultural, administrative, geographic, and economic.

In addition to the four basic dimensions of Porter's "diamond" model, ____ may also contribute to the success or failure of firms.

Multinational firms have many opportunities to learn from their experiences in international markets, but they must have a strong R&D system to absorb the knowledge.

An international diversification strategy is one in which a firm

Discuss the three international corporate-level strategies. On what factors are these strategies based?

A multidomestic corporate-level strategy has ____ need for global integration and ____ need for local market responsiveness.

While there are multiple means of entering new international markets, firms should use one method consistently with all of its various products and across its different markets in order to reduce administrative complexity.

Asahi Group Holdings Ltd. of Japan is an example of a firm that seeks to become one of the top 10 food and beverage companies via international diversification.

Some of the costs incurred by firms pursuing international diversification may derive from higher coordination expenses, trade barriers, and lack of familiarity with local cultures.

Because of the lack of protection of intellectual property in some foreign countries, licensing arrangements are one of the best ways for a firm to protect its technology from being appropriated by potential competitors.

Michael Porter's Determinants of National Advantage describe factors associated with the firm's domestic environment that contribute to its dominance in a particular global industry.

The decision of what entry mode to use is primarily based on all of the following factors EXCEPT

What are the three basic benefits of international strategies?

Case Scenario: Compliance, Inc. Compliance, Inc., (CI) conducts clinical human and animal trials for the pharmaceutical and biotechnology industries. Revenues are split evenly between early and late drug development services. In the area of early drug development, CI offerings include analytical, bioanalytical, antibody, clinical pharmacology (Phases I-IIa) , toxicology, and drug metabolism services. Late development services include central diagnostics, central lab, clinical development (Phases IIb- IIIa) , periapproval (Phases IIIb-IV) , and pharmacogenomics. The bulk of its business is conducted in Europe and the U.S. (10 and 17 subsidiaries, respectively) ; CI also has subsidiaries in Africa, Latin America, Asia, and Australia. While now an independent public company, CI was once itself a subsidiary of Corning International. Corning built up CI through over 40 acquisitions, hoping to extend its strength in medical testing glassware into the medical services business. At the time Corning made its acquisitions, the clinical testing industry was geographically fragmented, owing largely to the fact that various parts of the world had their own strong local pharmaceutical companies and distinct regulatory environments. Perhaps for that reason Corning, and now CI, has retained the autonomous character of each country's businesses. However, globalization of the regulatory environment (both global and local standards) , globalization of the biotechnology firms (increasing the geographic scope of their operations) , and tremendous consolidation in the pharmaceutical industry (reducing the number of pharmaceutical industry participants to -(Refer to the above Case Scenario) What type of international strategy is CI currently pursuing?