Prestige Institute of Management and Research, Indore
Submitted To: Prof. Vibha Sahu
Presented By: Akash Singh Ankit Gupta Hemant Verma Ravi Pratap Singh Chauhan Sanjay Neekhar
INTERNATIONAL STRATEGIC PLANNING:
ITS NATURE AND DIMENSIONS
Strategy:A strategy is a plan of action designed to achieve a vision.
Strategic Planning:The process of determining a companys long-term goals and then identifying the best approach for achieving those goals. Strategic planning is a tool for organizing the present on the basis of the projections of the desired future.
INTERNATIONAL STRATEGIC PLANNING
International strategic planning is a process adopted by multi national organizations in order to formulate an effective strategy. It is a process of evaluating the internal and external environment by multinational organizations, through which they set their long-term and short-term goals and then they implement a specific plan of action in order to achieve those objectives. International strategic planning is different from normal domestic strategic planning, because, in this case, organizations consider internal as well as external environments. In fact, the external environment is more crucial to consider when you are operating at a international level because at a domestic level competition is very directional and optimized, but at international level the competition is crucially important to be considered; otherwise survival is not at all possible at international level.
Facilitators Of International Expansion
Govt. and Political Forces Technological Forces
Internationalization
Market Forces
Competitive Forces
Five Tasks Of International Strategic Planning
Forming a International Strategic Vision
Setting Objectives
Crafting a International Strategy
Implementing & Executing
Evaluating Performance & Monitoring
Forming a International Strategic Vision
Very early in the strategy-making process, company managers need to pose a set of questions: "What is our vision for the company where should the company beheaded, what should its future technology-product-customer focus be, what kind of enterprise do we want to become, what industry standing do we want to achieve in five years?"
SETTING OBJECTIVES
The purpose of setting objectives is to convert managerial statements of strategic vision and business mission into specific performance targets results and outcomes the organization wants to achieve. Setting objectives and then measuring whether they are achieved or not help managers track an organization's progress.
CRAFTING STRATEGY
A company's strategy represents management's answers to such fundamental business questions as: whether to concentrate on a single business or build a diversified group of businesses whether to cater to a broad range of customers or focus on a particular market niche whether to develop a wide or narrow product line how to respond to changing buyer preferences how big a geographic market to try to cover how to react to newly emerging market and competitive conditions how to grow the enterprise over the long term.
What Does a Company's Strategy Consist Of ?
Company strategies concern:
how to grow the business how to satisfy customers how to outcompete rivals how to respond to changing market conditions how to manage each functional piece of the business and develop needed organizational capabilities how to achieve strategic and financial objectives
Strategy Implementation and Execution
Strategy implementation concerns the managerial exercise of putting a freshly
chosen strategy into place Strategy execution deals with the managerial exercise of supervising the ongoing pursuit of strategy, making it work, and showing measurable progress in achieving the targeted results.
Strategy Evaluation and Monitoring
Evaluating performance, monitoring new developments, and initiating corrective adjustments It is management's duty to stay on top of the company's situation, deciding whether things are going well internally, and monitoring outside developments closely. Marginal performance or too little progress, as well as important new external circumstances, will require corrective actions and adjustments.
International Strategy Hierarchy
CORPORATE STRATEGY
BUSINESS STRATEGIES
Functional Strategies (R&D, Marketing, Manufacturing, HR, Finance, etc.)
Operating Strategies (regions,plants, departments withinfunctional areas)
FACTORS SHAPING THE CHOICE OF STRATEGY
EXTERNAL FACTORS
INTERNAL FACTORS
EXTERNAL FACTORS
Economic, political, societal, and government regulations Competitive conditions and industry attractiveness Company opportunity and threat
INTERNAL FACTORS
Company strengths and weaknesses, competencies and capabilities Personal ambitions and business philosophies of key executives Shared values and company culture
Economic, political, social, and government regulations
What an enterprise can and cannot do strategy wise is always constrained by what is legal, by what complies with government policies and regulatory requirements, by what is considered ethical, and by what is in accord with societal expectations and the standards of good social and community citizenship.
Competitive conditions industry attractiveness
An industry's competitive conditions and overall attractiveness are big strategydetermining factors. A company's strategy has to be tailored to the nature and mix of competitive factors in playprice, product quality, performance features, service, warranties, and so on.
Company opportunity and threat
A company's strategy needs to be deliberately aimed at capturing its best growth opportunities, especially the ones that hold the most promise for building sustainable competitive advantage and enhancing profitability. Strategy should also provide a defense against external threats to the company's well-being and future performance.
Company strengths and weaknesses, competencies and capabilities
One of the most pivotal strategy-shaping internal considerations is whether a company has or can acquire the resources, competencies, and capabilities needed to execute a strategy proficiently.
The best path to competitive advantage is found where a firm has competitively valuable resources and competencies, where rivals can't develop comparable capabilities except at high cost or over an extended period of time.
Personal ambitions and business philosophies of key executives
Managers do not dispassionately assess what strategic course to steer. Their choices are typically influenced by their own vision of how to compete and how to position the enterprise and by what image and standing they want the company to have.
Shared values and company culture
An organization's policies, practices, traditions, philosophical beliefs, and ways of doing things combine to create a distinctive culture. The stronger a company's culture, the more that culture is likely to shape the company's strategic actions, sometimes even dominating the choice of strategic moves.
Foundations Of International Strategy
Ethnocentrism Polycentrism Geocentrism
Ethnocentrism
It looks upon everything that originates from an organizations home country as the best in the world. Thus the international firms headquarters controls all that goes on in the world for that firm, including managerial personnel, management techniques, products, marketing techniques, and overall strategy.
Ethnoce ntric Firm
Polycentrism
It assumes that countries have vast differences in their economic, political, social, legal, language and races. Thus management in the parent company should give foreign subsidiaries as much freedom as possible to manage their affairs.
Polycen tric Firm
Geocentrism
It is a world-orientation, with no predisposition regarding degree of control or centralization. There is interdependence among headquarters and all foreign subsidiaries is emphasized. Communications and shared perspectives are key.
Geocen tric Firm
