MANAGINGDIFFERENCESTHE CENTRAL CHALLENGE OF GLOBAL STRATEGY

TYLER WILLIAMSZACHARY SEEVERJORDAN WAECHTER

BUS-444 SPRING 2016

HARVARD BUSINESS REVIEWMARCH 2007

ACHIEVING ECONOMIES OF SCALE

RESPONSIVENESS TO LOCAL CONDITIONS

CHALLENGES WITH CROSS-BORDER INTEGRATION

DEVELOP FRAMEWORK SCORECARD FOR GLOBALIZATION

JORDAN WAECHTERBUS-444 SPRING 2016

GLOBAL STRATEGY

ADAPTATION AGGREGATION

JORDAN WAECHTERBUS-444 SPRING 2016

Maximize local relevance

through boosting

revenues and market

share

To achieve scale and

scope economies

through international

standardization

Exploitation of

differences between

national and regional

markets

ARBITRAGE

DEFINING THE (3) AAA

EXAMPLE: LOCAL UNITS IN MARKET

COUNTRY CENTERED ORGANIZATION

EXPANDING BEYOND HOME TERRITORY

ADDRESS ISSUES WITH LOCAL PRESENCE

FOCUS ON ACHIEVING LOCAL PREFERENCES

JORDAN WAECHTERBUS-444 SPRING 2016

ADAPTATION

JORDAN WAECHTERBUS-444 SPRING 2016

AGGREGATION

DELIVER ECONOMIES OF SCALE

GROUP DEVELOPMENT & PRODUCTION

STANDARDIZE PRODUCTS AND SERVICES

CREATE REGIONAL & GLOBAL OPERATIONS

HORIZONTAL RELATIONSHIPS CROSS-BORDER

JORDAN WAECHTERBUS-444 SPRING 2016

ARBITRAGE

EXPLOITATION OF DIFFERENCES

EMPHASIS ON VERTICLE RELATIONSHIPS

BOTH NATIONAL AND REGIONAL MARKETS

ABSOLUTE ECONOMIES BY SPECIALIZATION

LOCATE SEPERATE PARTS OF SUPPLY CHAIN

EXAMPLE: CALL CENTERS INDIA, RETAIL CHINA

PHILIPS MEDICAL SYSTEM (PMS)

SMALLEST OF THE BIG THREE DIAGNOSTIC-IMAGING FIRMS

DECENTRALIZED STRATEGY

PMS’S ABSOLUTE R&D EXPENDITURES

PMS WAS STITCHED TOGETHER BY 6 SEPARATE COMPANIES

TYLER WILLIAMSBUS-444 SPRING 2016

DEVELOPING AAA

STRATEGY

TYLER WILLIAMSBUS-444 SPRING 2016

2 ALTERNATIVES FOR PMS

ADAPTATION-AGGREGATION (CLOSEST TO CURRENT STRATEGY)

UNLIKELY SOLVE AGGREGATION RELATED CHALLENGES FACING PMS

COULD GIVE UP ON THE IDEA OF COMPETITIVE ADVANTAGE

COMPETITIVE MAP

FOR AAA STRATEGY

AAA STRATEGY

TYLER WILLIAMSBUS-444 SPRING 2016

ADAPTATION-ARBITRAGE:

AIM AT PRODUCING IN LOW-COST LOCATIONS

DOES NOT FIT WITH PMS’S HERITAGE

THIRD ALTERNATIVE: CHANGE GAME ENTIRELY

WHAT DO THESESTRATEGIC CONSIDERATIONS

IMPLY FOR INTEGRATION AT PMS?

MAIN POINTS

ZACHARY SEEVERBUS-444 SPRING 2016

FOCUS ON ONEOR TWO OF THE

A'S FORSTRATEGY

ALL THREE WOULDBE IDEAL, BUT MAY

SPREAD YOURRESOURCES THIN

ASSURE NEWELEMENTS ARE A

GOOD FITORGANIZATIONALLY

MONITOR HOWTHESE NEW

ELEMENTS WORKIN THE

ORGANIZATION

EMPLOYMULTIPLE

INTEGRATIONMECHANISMS

REQUIRESCREATIVITY ANDREINFORCEMENT

BY STRUCTUREAND SYSTEMS

ZACHARY SEEVERBUS-444 SPRING 2016

THINK ABOUTEXTERNALIZINGINTEGRATION

KNOW WHENNOT TO

INTEGRATE

NOT ALLINTEGRATION HAS

TO BE DONEALONE, FORM

ALLIANCES

SOMEINTEGRATION MAY

BE GOOD, BUTMORE IS NOT

ALWAYS BETTER

QUESTIONS?