Essay about Global Strategy Implementation

5810 Words Oct 7th, 2013 24 Pages
Part Five
GLOBAL STRATEGY, STRUCTURE, AND IMPLEMENTATION

Chapter Eleven
The Strategy of International Business

OBJECTIVES

• To identify how managers develop strategy • To examine industry structure, firm strategy, and value creation • To profile the features and functions of the value chain framework • To assess how managers configure and coordinate a value chain • To explain global integration and local responsiveness • To profile the types of strategies firms use in international business

Chapter Overview

Chapter Eleven presents tools and concepts used in analyzing and formulating international business strategy. First, the relationship between industry structure and
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Rather than having seasonal clothing collections, Zara has “live collections” in which no style lasts more than four weeks. The company purchases much of its fabric not yet dyed so it can make color changes quickly during and between seasons. Unlike many of its competitors, Zara produces its most time- and fashion-sensitive products internally. It employs more than 15,000 people in 20 company-owned factories to produce about 40 percent of Zara’s finished product. These factories are highly automated to control costs and further speed production. Sophisticated distribution centers in Spain, Brazil, and Mexico are used to keep inventory moving efficiently from factory and supplier to store. Most clothes are only in the distribution center a few hours, and none is ever there more than three days. Stores are located in high-profile locations, and store managers and staff choose their merchandise and keep in close touch with local trends. By constantly rotating merchandise, Zara creates a climate of scarcity and opportunity for loyal customers.

Teaching Tips: Carefully review the PowerPoint slides for Chapter Eleven, as well as the opening case regarding Zara, which is cited throughout the chapter. See the Video Correlation Grid for video suggestions.

I. INTRODUCTION This chapter shifts the focus from external factors that exert influence on the international business to

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