bman 73172 lecture 1 introduction and why institutions feb3rd 2016(1)
TRANSCRIPT
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BMAN 73172Institutions and Firms
InternationalizationStrategiesProf Mo YaminMo.Yaminman!"ester.a!.u#
Yusuf $urtYusuf.#urtman!"ester.a!.u#
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mailto:[email protected]://var/www/apps/conversion/tmp/scratch_2/yusufhttp://var/www/apps/conversion/tmp/scratch_2/yusufmailto:[email protected] -
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%&er&ie' of (oda)sSession
Introdu!tions %rganizational Matters
Assessment
Textbook *ourse aims + and &alue added *ourse outline
,e!ture 1 Pro-er
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Presentations No more t"an 14 minutes
Sti!# to t"e 5uestions t"at are as#ed No des!ri-ti&e 0a!#ground on t"e !om-an) 6se Po'erPoint or some ot"er soft'are to
-resent. Please send Yusuf and me ele!troni! !o-ies
of t"ose slides 0efore t"e -resentation You 'ill not re!ei&e etra mar#s for 8fan!)
animation
9a!" -resentation 'ill 0e follo'ed 0) a 1
minute dis!ussion
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Assessment II: Indi&idualAssignment
+elect two multinational companies from di,erent countries thatcompete in the same market!
xamine their ownership and control structures! In '"at 'a)s do t"e) di;er< =o' do t"e -riorities of t"e !om-anies di;er >if at all? as
a result@emem0er )ou ma) onl) need
to fo!us on t"ose as-e!ts of t"e institutionalen&ironment t"at are most im-ortant to t"e !om-an).?
1ow do the rms/ home-country institutional contexts a,ect
their resources and capabilities1ow ha&e these institutional di,erences a,ected the ways inwhich the rms ha&e internationalied!
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.imensions ofinternationalisation
Proportion of assets located abroad Proportion of technology development located abroad Type of foreign technology development (new products
for world market, new processes for international operations,
product adaptations for local markets)
Type of foreign investment in different locations(greenfield, acquisition, joint ventures)
Type of international trade (finished goods, intermediate
goods) Type of subsidiary manager (expatriate, host society, third
country) Internationalisation of domestic management
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Assignment II
Indi&idual assessment >/ of o&erallmar#?
Word 3imit4 2560 words 'excludin
references and tables) * plus or minus tenper cent#
.eadline4 7y 8pm Thursday 6th 9ay 20:;
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(et0oo#
Best to 0u) ingrou-s
enae 3earnin
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*ourse %utline %0Ce!ti&es
("e o0Ce!ti&es of t"is !ourse are: to illustrate how rms alliances and markets
are oranied di,erently around the world to examine the ways that this &ariation leads
to the de&elopment of distincti&e capabilitiesin rms in di,erent parts of the world
to analyse the ways in which rms fromdi,erence countries internationalie and
to assess how di,erent multinationalcompanies manae &arious acti&ities aroundthe world!
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*ourse %utline + ,earning%ut!omes
("ose '"o su!!essfull) !om-lete t"is unitare e-e!ted to 0e a0le to:
compare the institutions of di,erent countries analyse the preferred strateies and
capabilities of rms from di,erent countriesand sub-national reions
understand how companies from di,erentlocations internationalie in distincti&e ways
and understand how manaers seek to o&ercome
the manaerial and oraniational challenesthat are associated with multinational
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("e Dalue Added
*ourse -ro&ides a more detailed a!!ountof "o' Erms &ar) 0et'een !ountries
9na0les more !on&in!ing e-lanations ofErms internationalization strategies to
0e -ut for'ard
Pro&ides )ou 'it" a 0etter understandingof large Erms
=el-s )ou to understand '") !ertainde!isions are or are not ta#en 0) )ourfuture em-lo)er
Sets out t"e !"allenges t"at Erms fa!e
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*ourse %utline Introdu!tion 3ecture : '@theb 20:;) 9( and (= 4 The World is lat
Institutions and Why 3ocation 9atters 3ecture 2 ':: eb ) 9( and (= 4 irms >ountries and omparati&e Ad&antae in Industries
Institutional Dariation 0et'een *ountries 3ecture 8 ':Bth eb ) '9( and (=)4 Who ?wns * and >ontrols *
>ompanies around the World 3ecture @ '26th eb) 9( and (= 4 The +tate/s +take in
>ommercial Acti&ities 3ecture 6 ' 8rd 9arch) 9( and (= 4 3abourin to ind
Appropriately +killed mployees 3ecture ; ':0th9arch) 9( and (=4 >hanes in the nancial
system
Managing In!reasing *om-leit) in t"e Multi0usinessMN*
3ecture 5 ':5th 9arch) 9( and (=4 9anainInternationaliation4
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Institutions and Firms
InternationalizationStrategies
,e!ture 1: ("e orld is FlatErms asso!iations unions state
an on&en ona e n ons
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2013 Cengage Learning. All rights reserved.
an on&en ona e n onsstress more t"e 8regulati&e as-e!ts ofinstitutions
P9NH and MY9@ regard institutions as Formal and informal -oli!ies -o-ularl) #no'n
as t"e rules of t"e game.J
Peng and Me)er: Institution0ased &ie'is -ers-e!ti&ein '"i!" Erms su!!ess is !orrelated to
monitoring de!oding and ada-ting to!"anging rules of t"e game:
This seems to imply that institutions are Foutside/ of the
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2013 Cengage Learning. All rights reserved.
,%1: (% (YP9S %F INS(I(6(I%NS
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2013 Cengage Learning. All rights reserved.
,%1: (% (YP9S %F INS(I(6(I%NS
Formal institutions:
laws, regulations, and rules.
Regulatory pillar:
coercive powerof governments
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2013 Cengage Learning. All rights reserved.
,%1: (% (YP9S %F INS(I(6(I%NS
Informal institutions:norms, culture, and ethics.
Normative pillar -how the values,beliefs, and actionsof other relevantplayers influence the
behavior of focalindividualsand firms.
Cognitive pillar internali!edvalues and beliefsthat guideindividual and
firm behavior.
,%3: "at Ko Institutions Ko< ") are
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2013 Cengage Learning. All rights reserved.
,%3: "at Ko Institutions Ko< ") are("e) Im-ortant or 8&oids? in "ost !ountries
ma) 0e limited 0e!ause t"eir a0ilities and-ers-e!ti&es are s"a-ed too strongl) 0)t"eir "ome institutions
MN9s !annot al'a)s 0e su!ientl)
8!osmo-olitan or ada-t su!!essfull) to "ost!ountr) en&ironment >!onsider (es!osfailure in t"e 6S ?
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*ase Stud)(es!o P,*: Fres" O9as) in t"e 6nited
States
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(9S*% P,*
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(9S*% P,*
*AS9 S(6KY 69S(I%NS
"o o'ns (es!o P,*< "at does t"is tells us a0out its main goals< "at are t"e -riorities of its Enan!ial
0a!#ers < (o '"at etent did Fres" and 9as) ada-t >its
-rodu!ts and t"e (es!o 8'a) of doingt"ings? to t"e 6S mar#ethief xecuti&e T+>? )!
9any of Tesco/s in&estors >s"are"olders?ha&e
been callin for the company to Kuit the $+market and focus on its protable &entures!
.oin Pnot ood enouhQ in the $= market bycomparison to its ri&als!
PThey ha&e taken the riht decision RKuittin from$+ marketS for s"are"oldersQ 'Andrew=asoulis analyst at >redit +uisse)! 3
"o is 8!alling t"e s"ots and '")
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Tim 9ason came under re from s"are"olderslastyear with se&eral criticisin a @!8m pay-out herecei&ed despite the $+ failin to turn a prot andne&er ettin a serious foothold in the market!
Dearly half of all shareholders failin to back TescoUsremuneration report at the 20:: annual meetin!
PAs >hairman my primary duty is to s"are"oldersVdeli&er the loner-term performance our s"are"olders
expectQ! 'T+>? 20:6 annual report p!2)
S"are"olders are o'ners of !om-anies and-la) role in Enan!ing o-erations0
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Hlo0al Su!!ess @e5uirest"at !om-anies
a--re!iate di&ersit) anddistan!e rat"er t"an
see# to eliminate t"emJ'
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*oasian &ie'
I7 is inGuenced by this &iew an assumed to be auni&ersall) e5ui&alent !on!e-tin terms of theecient boundaries between hierarchy and markets
("e !om-arati&e &ie' of t"e Erm : ("enature of t"e Erm is 8!ontingent . PThe nature of the rm as the key collecti&e
economic actor is &aria0leacross di,erentlyoranied market economies and cannot be
assumed to be basically the same reardless of itspolitical and social contextQ !
3ooks at Fwhat oes on/ within rms far more thanthe >oasian &iew does! 2Institutional (ers(ective
*on!lusions and
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*on!lusions + and@e!ommendation
Pla!e matters Institutions matter ("ese institutions &ar) from -la!e to -la!e. Firms di;er in fundamental and im-ortant
'a)s ("eir #e) o0Ce!ti&es di;er ("is 'ill a;e!t t"e etent to '"i!" t"e)
internationalize.
Please read and reread t"e Ta!#son andKeeg >2/? -a-er listed under le!ture 3. It'ill -ro0a0l) 0e "ard going 0ut it is