Additional Videos 6: CAGE Analysis & Integration-Responsiveness grid Flashcards
(16 cards)
What is the goal of the CAGE Analysis?
It serves as a reminder that distance still matters in a global strategy
Which three decisions are most affected by distance?
- Internationalization
- Marketing strategy
- Governance
What are the four components of the CAGE analysis?
- Culture
- Administration
- Geography
- Economy
What is meant with cultural analysis in the CAGE analysis?
differences in religious beliefs, social norms, and language
What is meant with administrative distance in the CAGE analysis?
differences in religious beliefs, social norms, and language
What is meant with the geographical distance in the CAGE analysis?
Geographical distances eat into comparative advantages through transportation costs, time loss, and decay of perishable costs
What is meant with economic distance in the CAGE analysis?
differences in wealth of individual consumers and in economic development make leveraging existing business models across borders challenging
What is the integration-responsiveness grid?
matrix that shows that internationally active companies have to choose an organizational structure that matches their business model.
Highlights the importance of decentralized learning
What is decentralized learning?
aining new knowledge in local contexts is seen as key to global competitiveness
Which factors determine the extent to which business models require global integration?
- Economies of scale in production
- Global quality standards
- Strong parenting advantages
- Interdependence on business units
- Intra-company sourcing
Which factors determine the extent to which business models require responsiveness to local variation?
- Consumer goods
- Local variations in tastes
- Demand for modified products
- Call for locally adapted marketing
- Closeness of R&D to end user
What are the four components of the integration-responsiveness grid?
- Global strategy
- International strategy
- Transnational strategy
- Multi-domestic strategy
What is global strategy?
Strategy with high global integration and low local responsivenss
What is an international strategy?
Strategy with low global integration and low local responsiveness
What is an transnational strategy?
Strategy with high global integration and high local responsiveness
What is a multi-domestic strategy?
Strategy with low global integration and high local responsiveness
