Podcast
Questions and Answers
What was the classic organizational form employed by multinationals?
What was the classic organizational form employed by multinationals?
Which mode is NOT mentioned as a method of entering and existing markets?
Which mode is NOT mentioned as a method of entering and existing markets?
What often triggers the transition触发转变 from one market entry mode to another?
What often triggers the transition触发转变 from one market entry mode to another?
What factor is NOT listed as influencing the mode employed by multinationals?
What factor is NOT listed as influencing the mode employed by multinationals?
Signup and view all the answers
Which of the following is an example of a non-equity mode of market entry非股权方式的市场进入?
Which of the following is an example of a non-equity mode of market entry非股权方式的市场进入?
Signup and view all the answers
What benefit does developing local capabilities本地能力 provide to multinationals?
What benefit does developing local capabilities本地能力 provide to multinationals?
Signup and view all the answers
Which of the following strategies reflects an incremental process增量过程 for multinationals entering a foreign market?
Which of the following strategies reflects an incremental process增量过程 for multinationals entering a foreign market?
Signup and view all the answers
What type of foreign market entry does not typically require incremental adaptation增量适应?
What type of foreign market entry does not typically require incremental adaptation增量适应?
Signup and view all the answers
What method do firms use to establish a wholly owned subsidiary in a foreign country?
What method do firms use to establish a wholly owned subsidiary in a foreign country?
Signup and view all the answers
Why might firms entering foreign markets prefer acquisitions over greenfield investments?
Why might firms entering foreign markets prefer acquisitions over greenfield investments?
Signup and view all the answers
In which situation might late entrants to oligopolistic markets favor acquisition as an entry strategy在什么情况下，寡头垄断市场的后来进入者可能会选择收购作为进入策略?
In which situation might late entrants to oligopolistic markets favor acquisition as an entry strategy在什么情况下，寡头垄断市场的后来进入者可能会选择收购作为进入策略?
Signup and view all the answers
Which factor does NOT significantly influence a firm's choice of entry mode into foreign markets?
Which factor does NOT significantly influence a firm's choice of entry mode into foreign markets?
Signup and view all the answers
How might established multinationals approach the choice of entry into static markets?成熟的跨国公司如何选择进入静态市场
How might established multinationals approach the choice of entry into static markets?成熟的跨国公司如何选择进入静态市场
Signup and view all the answers
What is a notable characteristic of firms when entering foreign markets?
What is a notable characteristic of firms when entering foreign markets?
Signup and view all the answers
In which type of market scenario might higher acquisition rates be observed?在哪种类型的市场场景中可能会出现更高的收购率？
In which type of market scenario might higher acquisition rates be observed?在哪种类型的市场场景中可能会出现更高的收购率？
Signup and view all the answers
What is a common approach for firms with new technologies entering foreign markets?
What is a common approach for firms with new technologies entering foreign markets?
Signup and view all the answers
What was a significant consequence of US manufacturing firms' increased use of acquisitions after World War II?
What was a significant consequence of US manufacturing firms' increased use of acquisitions after World War II?
Signup and view all the answers
Which company built an international ice cream business through acquisitions in Europe and beyond?
Which company built an international ice cream business through acquisitions in Europe and beyond?
Signup and view all the answers
What characterizes a fragmented market?
What characterizes a fragmented market?
Signup and view all the answers
Why were acquisitions less frequent经常 in developing countries after World War II?
Why were acquisitions less frequent经常 in developing countries after World War II?
Signup and view all the answers
What market share did Unilever hold in the European ice cream market by the 1980s?
What market share did Unilever hold in the European ice cream market by the 1980s?
Signup and view all the answers
What notable merger合并 occurred involving Unilever in Brazil?
What notable merger合并 occurred involving Unilever in Brazil?
Signup and view all the answers
What facilitated the establishment of hostile takeover bids促进恶意收购要约的制定 in the 1950s?
What facilitated the establishment of hostile takeover bids促进恶意收购要约的制定 in the 1950s?
Signup and view all the answers
How did Unilever's early operations in Brazil influence its later acquisitions?
How did Unilever's early operations in Brazil influence its later acquisitions?
Signup and view all the answers
What was significant about Vodaphone's acquisition of Mannesmann in 2000?
What was significant about Vodaphone's acquisition of Mannesmann in 2000?
Signup and view all the answers
Which of the following factors contributes to the risks associated with acquisitions增加与收购相关的风险?
Which of the following factors contributes to the risks associated with acquisitions增加与收购相关的风险?
Signup and view all the answers
What common issue do foreign firms face after completing acquisitions in the United States?
What common issue do foreign firms face after completing acquisitions in the United States?
Signup and view all the answers
Which of the following statements about cross-border acquisitions is true?
Which of the following statements about cross-border acquisitions is true?
Signup and view all the answers
What is often a motive for managers to pursue acquisitions, despite the risks involved?
What is often a motive for managers to pursue acquisitions, despite the risks involved?
Signup and view all the answers
What kind of problems can arise due to differences in corporate cultures 由于企业文化差异而产生during an acquisition?
What kind of problems can arise due to differences in corporate cultures 由于企业文化差异而产生during an acquisition?
Signup and view all the answers
Which of the following reflects the impact of foreign acquisitions on US firms?
Which of the following reflects the impact of foreign acquisitions on US firms?
Signup and view all the answers
What is an organizational issue described in the context of cross-border acquisitions?
What is an organizational issue described in the context of cross-border acquisitions?
Signup and view all the answers
What is one potential downside of fully integrating an acquired foreign firm into the parent company's systems?
What is one potential downside of fully integrating an acquired foreign firm into the parent company's systems?
Signup and view all the answers
What term describes Unilever's systematic approach to absorbing acquired firms?
What term describes Unilever's systematic approach to absorbing acquired firms?
Signup and view all the answers
What did Unilever change within acquired firms as part of the 'Unileverization' process?
What did Unilever change within acquired firms as part of the 'Unileverization' process?
Signup and view all the answers
What significant change occurred in staffing人员配置 at Cheseborough Ponds after its acquisition by Unilever?
What significant change occurred in staffing人员配置 at Cheseborough Ponds after its acquisition by Unilever?
Signup and view all the answers
In which decades did large multinationals begin to routinize post-acquisition management开始常态化收购后管理?
In which decades did large multinationals begin to routinize post-acquisition management开始常态化收购后管理?
Signup and view all the answers
Why were joint ventures particularly prominent during the interwar years?
Why were joint ventures particularly prominent during the interwar years?
Signup and view all the answers
What was a notable characteristic of the Kuwait Oil Company formed in 1934?
What was a notable characteristic of the Kuwait Oil Company formed in 1934?
Signup and view all the answers
How did Unilever manage to reduce the acquisition cost of Cheseborough Ponds?
How did Unilever manage to reduce the acquisition cost of Cheseborough Ponds?
Signup and view all the answers
What prompted提示/促使 Standard Oil of California and Texaco to form a joint venture in 1936?
What prompted提示/促使 Standard Oil of California and Texaco to form a joint venture in 1936?
Signup and view all the answers
How did IG Farben manage to re-establish its market position after World War I?
How did IG Farben manage to re-establish its market position after World War I?
Signup and view all the answers
What was the primary strategy employed by Océ van der Grinten for international expansion during the interwar years?
What was the primary strategy employed by Océ van der Grinten for international expansion during the interwar years?
Signup and view all the answers
What advantage did Océ van der Grinten gain through its licensing agreements?
What advantage did Océ van der Grinten gain through its licensing agreements?
Signup and view all the answers
What was a consequence of the capital shortage faced by firms like IG Farben?
What was a consequence of the capital shortage faced by firms like IG Farben?
Signup and view all the answers
What was a notable outcome of Océ van der Grinten's licensing strategy?
What was a notable outcome of Océ van der Grinten's licensing strategy?
Signup and view all the answers
What characterizes the role of managers from Océ when dealing with licensees?
What characterizes the role of managers from Océ when dealing with licensees?
Signup and view all the answers
In what way did IG Farben's approach to ownership differ from typical full ownership models?IG Farben 的所有权方式与典型的完全所有权模式有何不同？
In what way did IG Farben's approach to ownership differ from typical full ownership models?IG Farben 的所有权方式与典型的完全所有权模式有何不同？
Signup and view all the answers
Study Notes
Chapter 6: Crossing Borders
-
Topic and Structure of the lesson:
- Entering and existing Markets
- The evolution of multinationals
- Greenfield VS acquisition
- Divestments
- Alliances and constellations
- Subsidiaries and hybrids
Entering and Existing Markets
- The 'classic' organizational form: a wholly owned affiliate, but coexists with equity and non-equity modes
- Multinational process: incremental process of entering and evolving in a foreign market
-
Examples of entry modes:
- Exporting
- Selling through agents
- Establishing a distribution company
- Local production
- Multinational investment (increase in resources)
- Develop local capabilities and market knowledge
- Factors influencing entry choice: firm-, industry-, location-, and time-specific factors
- External causes and origin: trigger the move from one entry mode to another (eg. imposition of tariffs, competitive industry structure)
- Internal dynamics of decision-making: major determinant for entry modes in foreign markets
- Entrepreneurial ability: each firm has a unique combination of resources
Greenfield versus Acquisition
- Greenfield investment: creating a new firm in a foreign country
- Acquisition: acquiring an existing firm in a foreign country
-
Reasons for choosing Greenfield:
- Possessing unique technologies limiting the opportunities to acquire appropriate companies
- Fewer potential acquisitions in the new industries of the early global economy
- Large and established multinationals are more willing to undertake greenfield investment to reduce uncertainty.
-
Reasons for choosing Acquisition:
- Reducing uncertainty for late entrants in oligopolistic markets
- Speeding up response to competitors
- Growth opportunities in faster-growing markets
- Suitability for static or declining markets
Acquisition
-
Accelerated use: after World War II, US manufacturing firms adopted acquisition more to consolidate highly fragmented industries (such as ice cream)
-
Fragmented market: no one company has enough influence to move the industry, consists of several small to medium-sized companies competing
-
Examples of acquisitions:
- Unilever acquiring small ice cream businesses in the late 1950s
- Unilever held 30% of the European ice cream market by the 1980s
- Unilever acquired Companhia Gessy Industrial in Brazil in 1960, becoming the dominant soap and detergent manufacturer of the country
- Unilever acquiring small ice cream businesses in the late 1950s
-
Hostile takeovers: becoming common from the 1950s in the US and UK, initially rare in Continental Europe and Japan
-
Example: Vodafone’s acquisition of Mannesmann in 2000
Risk of Acquisition
- Information asymmetry: sellers of a firm typically have better information than buyers
- Post-acquisition management problems: managing pre-existing firms
- Value addition: Acquisitions often mainly benefit the acquired firm's shareholders rather than the overall utility of acquisition firms
- Cross-border acquisitions: additional risks due to differences in cultures, legal systems and accounting standards
- Overseas acquirers: sometimes pay too much for acquisitions in the US, often acquiring firms with low profitability
- Senior management retention: foreign firms face difficulties retaining US senior executives due to high job mobility and differences in cross-cultural tensions
Alliances and Constellations
- Joint ventures: widely used interwar years due to financial pressures and risk sharing
- Cartel agreements: included in joint ventures
- Political risk considerations: used in production, refining, and marketing operations, and in the Middle East due to political uncertainty -Example: Kuwait Oil Company in 1934, jointly owned by Gulf Oil and Anglo-Persian (now BP)
Collaborative Arrangements
- Capital shortage: led some firms into collaborative arrangements to access foreign markets
- Technological advantage: used as a bargaining tool, as seen in IG Farben
- Equity stakes: IG Farben acquired equity stakes in US chemical firms to reacquire strong market position without huge capital investment
Licensing
- Low commitment strategy: used by firms to access foreign markets without massive financial or managerial commitment
- Example: Océ van der Grinten, a Dutch family firm, licensed copying paper production techniques in Europe the US, Latin America, and Japan
Acquisition
- Routinized process: post-acquisition management inside large multinationals became more systematic, standardized through corporate procedures
- Example: Unilever’s acquisition strategy, which involved integrating acquired firms through measures like changes in corporate accounting practices, salaries, and pensions.
- Large-scale acquisition: could take up to a decade, but integration was sometimes faster -(e.g., Cheseborough-Ponds).
Studying That Suits You
Use AI to generate personalized quizzes and flashcards to suit your learning preferences.
Related Documents
Description
Test your knowledge on the various organizational forms and market entry modes employed by multinationals. This quiz will explore the factors influencing market entry strategies and the benefits of developing local capabilities. Challenge yourself with questions about non-equity modes and incremental processes.
