Global Strategy 1e Michael Peng Global Strategy Mike W Peng c h a p t e r 8 Copyright © 2014 Cengage Learning All Rights Reserved May not be scanned, copied or duplicated, or posted to a publicly acce.
Trang 1Global Competitive
Dynamics
Trang 2Copyright © 2014 Cengage Learning All Rights Reserved May not
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Outline
Trang 3Strategy as Action
Figure 8.1 Source: C M Grimm & K G Smith, 1997, Strategy as Action: Industry
Rivalry and Coordination (p 62), Cincinnati: Thomson South-Western.
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Strategy as Action
• Strategy is interaction
• Firms, like militaries, often compete aggressively
• Military principles cannot be completely applied in
business
• Business is simultaneously war and peace
• Militaries fight over geography, firms compete in markets
• Markets involve products and geography
• Multimarket competition: Firms engaging the same rivals
in multiple markets
• Multimarket competition may result in mutual forbearance
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Industry-Based Considerations
competition
Trang 77
Trang 8Industry Characteristics and Possibility
of Collusion vis-à-vis Competition
Table 8.1
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accessible website, in whole or in part.
Trang 1010
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Institution-based Considerations
• Formal institutions governing domestic
competition: a focus on antitrust
Competition policy
Antitrust policy
Competition/antitrust policy focuses on:
collusive price setting, predatory pricing, and extraterritoriality
• Formal institutions governing international
competition: a focus on antidumping
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Three Main Types of Attack
Trang 13Thrust
(e.g., Microsoft fights Netscape)
Source: Adapted from R G McGrath, M Chen, & I C MacMillan, 1998, Multimarket
maneuvering in uncertain spheres of influence: Resource diversion strategies (p 729),
Academy of Management Review, 23: 724–740.
Trang 14Feint
(e.g., Philip Morris fights RJR in the US and CEE)
Source: Adapted from R G McGrath, M Chen, & I C MacMillan, 1998, Multimarket
maneuvering in uncertain spheres of influence: Resource diversion strategies (p 731),
Academy of Management Review, 23: 724–740.
Trang 15Gambit
(e.g., Gillette fights BIC in lighters and razors)
Figure 8.7
Source: Adapted from R G McGrath, M Chen, & I C MacMillan, 1998, Multimarket
maneuvering in uncertain spheres of influence: Resource diversion strategies (p 733),
Academy of Management Review, 23: 724–740.
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accessible website, in whole or in part.
Attack and Counterattack
• Three main types of attack
Thrust
Feint
Gambit
• Awareness, motivation, and capabilities
Is the attack so subtle that rivals are not aware
of it?
Is the attacked market of marginal value?
Strong capabilities required for counterattacks
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Cooperation and Signaling
• Signaling
Market entry
Truce seeking
Strategic alliances for cost reduction
Trang 18Source: Adapted from N Dawar & T Frost, 1999, Competing with
giants: Survival strategies for local companies in emerging markets
(p 122), Harvard Business Review, March-April: 119–129.
Trang 19• Cell 1 (Dodger)
Market conditions:
of local markets are not enough.
Appropriate strategy: Dodger
agreeing to buyouts by MNEs, and/or becoming MNE suppliers and service providers.
All major Chinese automakers: MNE JV partners
Skoda in the Czech Republic: Sell out to Volkswagen
Many post-NAFTA Mexican manufacturers (since
1994): MNE suppliers and service providers
Local Firms versus MNEs (cont’d)
Trang 20technology with locally adapted design and marketing.
Appropriate strategy: Contender
those of the MNEs and then to thrust overseas.
Chinese cell phone makers (TCL and Bird) vs
Motorola and Nokia
Trang 21Local Firms versus MNEs
• Cell 3 (Defender)
Market conditions:
local markets.
Appropriate strategy: Defender
strongholds in other markets by leveraging local assets in market segments which MNEs are weak or
unaware of – in essence, a gambit
Bimbo vs PepsiCo in Mexico
Ahava vs cosmetics giants in Israel
Trang 22Local Firms versus MNEs (cont’d)
• Cell 4 (Extender)
Market conditions
overseas.
Appropriate strategy: Extender
expanding into similar markets – a thrust
Jollibee: Venture out of the Philippines
Asian Paints: From India to the rest of the
developing world.
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Two Most Significant Debates
be unfair, especially to large US firms
country - regarded as “unfair” trade laws elsewhere
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The Savvy Strategist
destruction
and/or cooperate
competition