International Strategic Management - Study Guide | MGMT 5560, Study notes of Introduction to Business Management

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MGMT 5560 International Strategic Management

University of Georgia Fall 2015, Professor Hubbard Rules: I’m going to add my bullets, points to focus on. Recognize that all the text is fair game; all the thought process/frameworks in the case studies are fair game; all handouts and discussions are fair game; all games we play and videos we watch are fair game. That being said, feel free to add questions or points of clarification to this document. I’ll do my best to keep it up-to-date. If you want to add your own notes here that you think will benefit the class, do so. Before the exam, I can clean out comments/notes that aren’t 100% necessary, but it’s good to have more information than not. If this helps, let me know. It’s going to be extra work for all of us. Thanks Monica for helping getting this going! CONTENT FOR EXAM # (I haven’t updated this fully, but will over the next few days) CONTENT LECTURES: All definitions, frameworks, diagrams from chapters are fair game. I will not ask about examples in the text (for example, the Strategy Highlights on page 17). The Take-Away Concepts at the back of each chapter are great. Chapter 1: What is strategy, and why is important? Know this: A strategy is “A collection of related, reinforcing, resource-allocating decisions and implementing actions.” We’ve talked a lot about different strategy frameworks, different discussions on what “makes a good strategy”, what are the elements of a strategy, how to communicate a strategy. You should know the different “formulations” that we’ve discussed (see page 4, Hambrick & Fredrickson article, HBR article, definition, etc). You need to know the points in each of the two articles that I had you read/skim. Examples include, but not limited to:  What are the facets of a good strategy statement?  Why 35 word limit?  Which of these (example, example) is better? Why?  What are the five parts of the strategy diamond?  What are some questions you can use to see if you have a strategy?  Given some company (well known), fill in the five diamonds.  Then there may be specific questions on each of the factors. You should know what a strategy is not. We didn’t talk a lot about stakeholders (page 13), but you should know the basics. Chapter 2: Strategic leadership: Managing the strategy process. You have to know about vision, mission, and values. What makes good ones? What are types that exist? Where to get ideas to start? You do not have to know the pyramid on page 38 (Exhibit 2.4), I don’t like it. Know the different levels of strategy. Know the three strategic management processes, which ones you like/dislike and why. Chapter 3: External Analysis:

The slides do a pretty good job of the content to know from this chapter. It’s important to be able to know which framework is appropriate for a given situation. Also, you need to know the parts of the frameworks, why they are important, what can be done to manage the parts (e.g. each of the five forces or PESTLE components). Furthermore, you should know in what order specific frameworks should be conducted. Also, know where there are potential overlaps in frameworks. Exhibits, such as 3.4, are great in this chapter. I don’t think profit pools are in the book, but they are an important way to assess how customers spend their money and how profitable those areas are. Know how to make the graph and interpret it. Chapter 4: Internal Analysis At a high level, internal analysis brings the analysis into the firm specifically. Here you are trying to evaluate what’s going on within the firm. This fits into the big perspective because it allows you to see the alignment, or misalignment, between the firm and the external environment (e.g. Exhibit 4.2). A key theme throughout the chapter: resources, capabilities, core competencies, and activities. Understanding how these four factors work together to deliver and sustain a competitive advantage is critical. The Resource Based View (RBV) is critical to understand what can create value for a firm. Understand the types of resources that are out there, examples of them, and how to evaluate them. You should also know the assumptions of RBV. Also, know how resources can be used to create a competitive advantage. Dynamic capabilities are the ability of a firm to create, deploy, modify, reconfigure, upgrade or leverage resources over time to obtain a competitive advantage. We didn’t talk a lot about it in class, but the basics are easy enough to get from the text. Value chains we did talk about. Quite a bit. You should know how to apply them. SWOTs again were discussed in more detail. You should know what a good SWOT looks like, where the factors come from. How to evaluate alternatives. Chapter 5: Competitive Advantage, Firm Performance, and Business Models You should know the full chapter. Key points to focus on: knowing accounting profitability, shareholder value, and economic value. You need to know the formulas (all in chapter, not just the Exhibit 5.1) and how, if possible, to calculate them from the Globe financial statements (note: not all can be done). You should know what the ratios mean and how to evaluate companies based on them. While the first two perspectives are fairly straightforward, spend some time understanding the economic value creation diagrams and frameworks. That is something that is also used in subsequent chapters. Know what a business model is. We looked at Cat’s and other companies. For all the parts of this chapter, it’s really important to know the strengths and weaknesses of each “perspective” and when one should be used over the other. Ignore the triple bottom line. Also, you will be tested on the PowerPoint on Balanced Scorecards.

Chapter 6 (Business Strategy): Need to know the chapter. Specific highlights: Know how firm and industry effects work together to drive a competitive advantage. Know the generic business strategies (cf Exhibit 6.2). Understanding how the value charts work will be helpful; for example, Exhibit 6.3. You should know the drivers that help each generic business strategy (e.g. economies of scale, learning curves, customer service). It will be important to understand in what situations each makes sense (that is, what industry characteristics and strategic positions). You should know the risks and benefits of each so that, if given a situation, you could make a recommendation. Know the integration strategy and how you can tell if you are “stuck in the middle”. Exhibit 6.10 does a good job summarizing the drivers of each of the three generic business models. Also, as I get to the end of the chapter, knowing that there is a productivity frontier—and that firms should push up against it at different points—will be helpful. Chapter 10 (Global Strategy): You should know the full chapter. Some highlights:  Advantages and disadvantages of competing abroad  CAGE framework in detail. For example, I could give you a country (a ‘well known one’) and ask you to evaluate it based on CAGE.  MNE entry methods (what they are, their advantages, disadvantages, and ‘characteristics’)  Integration-Responsiveness framework, know all four quadrants (characteristics, benefits, risks, examples)  National competitive advantages (Porter’s Diamond)  Know how a company could move from one strategy to the next Also, know the video we watch in class (link in PPT) CASE STUDIES: The most important thing to take away from case studies is the overall process. That is, there was a lot of thought put into the slides I recommended you create. You should be able to lay out a process like that. What I mean is that if I ask you to layout how you would make a particular decision or assess a specific situation, you’ll need to be able to do that. Google vs Microsoft Case Study Know that you need to select a method/framework before making a decision (like we did in the writeup slides). For the exam, you’ll need to know the appropriate frameworks given a particular situation. Strategic staging: the speed and sequence of actions. (ie.google needs to improve google docs to compete with mircrosoft and the only way to do that is by improving their mobile systems of google docs)

• Stars: google mobile systems
• Qmarks: google chrome, bing, google docs
• dog: microsoft devices
• cash cow: google ads, microsoft office Student: So as far as case studies go will we be given a mock case study and then need to implement the appropriate strategy or just know what steps to take given a situation?

TDH: I don’t think there will be enough time in the mid-term to do a full mock case study, so it will be more focused on knowing what to do given a specific question (which frameworks, etc.). You’ll, of course, need to know the frameworks too. I have been considering doing it for the final, but I’ll give you a lot of notice because that would be a very different exam than you are used to. Student: Will the Infosys case be on the test? TDH: All cases will be included, yes. Again, the details of the cases are not important. How we analyzed them is appropriate. GUEST SPEAKERS: I will probably ask one question for each guest speaker (we’ve only had Tom). It will be general and just test that you were listening. If you miss one of those classes, talk to a classmate about what they thought were important. GLOBAL DNA: Even though I was very specific that I would ask questions on GlobalDNA, my last class was a bit thrown by the questions. As we talk through the results, I’ll start to give you an idea of what I am expecting. Knowing the ratios we talked about in class is important. As well as being able to calculate those from the Globe in GDNA. Student: In the review on Friday, can you please explain how to find all of the values for the business model that you showed us for our groups in Global DNA. For example, I do not know how to solve Return on Investment Capital (ROIC) by using the numbers in Global DNA TDH: Sure, we can look at that. Based on the last time I taught it, it might not be possible to calculate every ratio that is in the book (they don’t break everything out quite enough for that). I won’t ask you to calculate a ratio that’s not possible.