ch16CORPORATE STRATEGY AND FOREIGN DIRECT INVESTMENT(跨国公司财务管理-Joseph F. Greco)

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THE STRATEGY OF THE MNC
3. The senescent MNC a. global scanning capability
b. the role of rationalization and
integration.
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THE STRATEGY OF THE MNC
4. FDI and Survival a. Cost reduction
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CHAPTER 16
CORPORATE STRATEGY AND FOREIGN DIRECT INVESTMENT
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CHAPTER OVERVIEW:
I. THE PROCESS OF OVERSEAS EXPANSION II. THEORY OF THE MULITNATIONAL CORPORATION II. THE STRATEGY OF
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THE THEORY OF THE MULTINATIONAL CORPORATION
B. Financial Market Imperfections 1. Hypothesis 2. Diversification Effect of the MNC
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III. THE STRATEGY OF THE MNC
a. Foreign agents b. Sales subsidiaries c. Distribution system
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THE PROCESS OF OVERSEAS EXPANSION B. OVERSEAS PRODUCTION
greater commitment to the local market
3. Acquisition
allows speedy transfer of unused parent skills; used more by small firms.
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THE PROCESS OF OVERSEAS EXPANSION
C. LICENSING -local firm agrees to produce for a fee. 1. Advantages:
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II. THE THEORY OF THE MULTINATIONAL CORPORATION
I. THE THEORY OF THE MULTINATIONAL CORPORATION A. The MNC as an Oligopolist: Why FDI? 1. When is FDI justified? 2. Internalization 3. Market Integration a. Vertical b. Horizontal
1. Advantages:
low cost low risk learning opportunity
4ห้องสมุดไป่ตู้
THE PROCESS OF OVERSEAS EXPANSION
2. Disadvantages
inability to realize full sales potential
3. Use of:
1. Advantages: a. Increased sales b. Supply stability c. Control d. Comprehensive service
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THE PROCESS OF OVERSEAS EXPANSION
2. Question:
create or acquire
a. Minimum investment b. Faster market entry c. Less risk
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THE PROCESS OF OVERSEAS EXPANSION
2. Disadvantages of licensing: a. Low cash flow b. Quality standards c. New competitor
b. Economies of scale
c. Multiple sourcing d. Keeping domestic customers
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IV. DESIGNING A GLOBAL EXPANSION STRATEGY
I. A GLOBAL EXPANSION STRATEGY A. Five Necessary Elements: 1. Awareness of profitable investments -building competitive advantage 2. Selecting a mode of entry -evaluate systematically
4.
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DESIGNING A GLOBAL EXPANSION STRATEGY
5. Estimating the longevity of competitive advantage:
a. Develop competitive strength
transferable overseas.
b. Not easily duplicated
MULTINATIONAL ENTERPRISE
III. DESIGNING A GLOBAL EXPANSION STRATEGY
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I. THE PROCESS OF OVERSEAS EXPANSION
I. METHODS TO GO GLOBAL
A. Exporting:
preferred market entry strategy
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DESIGNING A GLOBAL EXPANSION STRATEGY
A. Five Necessary Elements (con’t)
3.
Adjusting the Effectiveness of the Entry Mode - continual auditing
Using appropriate evaluation criteria
Multinational Financial Management
Alan Shapiro 7th Edition J.Wiley & Sons
Power Points by Joseph F. Greco, Ph.D. California State University, Fullerton
I. THE STRATEGY OF THE MNC A. Three strategies: 1. That of the Innovation-based MNC
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THE STRATEGY OF THE MNC
Three Strategies (con’t) 2. That of the mature MNC a. the importance of economies of scale and b. economies of scope