Strategies for Global Markets: KeyWords

International Business: Environments and Operations (11th Edition)Unique Competencies: are defined as unique strengths that allow a company to achieve superior efficiency, quality, innovation, or customer responsiveness.

Location Advantages: are those that occur from performing a value creation activity in the most advantageous location for that activity- in whichever part of the world that might be.

Experience Curve: refers to the systematic decrease in production costs that occur over the life of a product.

International Strategy: A strategy to create value by transferring valuable skills and products to foreign markets where local competitors lack those skills and products.

Multidomestic Strategy: A company is said to follow a multidomestic strategy if it extensively customises both its product offering and its marketing strategy to different national environments.
Strategic Management: Concepts and Cases: Competitiveness and Globalization
Global Strategy: A company following global strategy focuses on increasing profitability by reaping the benefits of cost reductions that come from experience-curve effects and location advantages. The various activities such as production, marketing, and R&D of companies pursuing a global strategy are concentrated in a few favourable locations.

Transnational Strategy: A company whose operations are not confined to any country or a region and which pursues low cost and product differentiation at the same time is said to follow a transnational strategy.In essence, transnational companies operate on a global level while maintaining a high level of local responsiveness.

Licensing: Licensing is an arrangement by which a foreign licensee buys the rights to produce a company’s product in the licensee’s country for a negotiated fee.
Strategic Management Competitiveness and Globalization, Concepts and Cases By Hitt, Ireland, & Hoskisson (8th, Eighth Edition)
Franchising: Franchising is a strategy similar to licensing. The only difference is that franchising is employed mainly by service companies. The advantages of franchising are similar to those of licensing. The franchiser does not bear the development costs and risks of commencing the operations in a foreign market on its own since the franchisee typically assumes those costs and risks.


Joint Ventures: A joint venture is an arrangement in which each party takes a ownership stake and the operating control is shared by a team consisting of managers from both parent companies.