International Busines Strategy - Chapter 3

7 flashcards · Other · by Daniel F.

1. Micheal Porter argues that

   any company’s ability to compete in the international arena is based mainly on an interrelated set of locations advantages in its home country high level of pressure in its home base pushed the firm to innovate and to upgrade systematically, resulting in FSA creation a nation’s competitiveness depends on the capacity of its industry to innovate and upgrade Companies should not rely on ‘natural’ factor endowments This type of thinking leads to reliance on short-term advantages which are easily r…

2. Points of porters diamond

   the four key sets of country attributes as the points of a 'diamond of national competitive advantage' Factor conditions Demand conditions Related and supporting industries Firm strategy +Government and chance

3. Factor conditions

   Factors relate to productions factors: Capital, labor, technology Firms need to continuously develop new skills: Continuous learning of employees Continuous innovation of machines

4. Demand conditions

   if buyers are demanding, external pressure on firms increases competitiveness increases.

5. Related and supporting industries

   high quality suppliers, universities etc.

6. Firm strategy

   industry structure and rivalry; a highly competitive, home-based industry with efficient macro-level governance and several domestic rivals may help the firms in that industry become internationally competitive.

7. What determines the competitiveness of the industry in the international marketplace?

   Porters diamond and external variables