Learning Objectives

1. What are the main benefits and risks of competing in international markets?

2. What is the "diamond model," and how does it help explain why some firms compete better in international markets than others?

3. What are the various global strategies that firms can adopt?

4. What forms of involvement are available to firms that seek to compete in international markets?

Exercises-1

1. Is offshoring ethical or unethical? Why?

2. Do you expect reshoring to become more popular in the years ahead? Why or why not?

3. Have you ever seen an advertisement that was culturally offensive? Why do you think that companies are sometimes slow to realize that their ads will offend people?

Exercises-2

1. Which of the four elements of the diamond model do you believe has the strongest influence on a firm's fate when it competes in international markets?

2. Automakers in China and India have yet to compete on the world stage. Based on the diamond model, would these firms be likely to succeed or fail within the global auto industry?

Exercises-3

1. Which of the three international strategies is Kia using? Is this the best strategy for Kia to be using?

2. Identify examples of companies using each of the three international strategies other than those described above. Which company do you think is best positioned to compete in international markets?

Exercises-4

1. Do you believe that KFC would have been so successful in China today if executives had tried to make their first store a wholly owned subsidiary? Why or why not?

2. The typical joint venture only lasts a few years. Why might joint ventures dissolve so quickly?