1 - Define Liability of Foreignness and Regionalism. Discuss how it relates to and how it impacts international strategies
2 - What is a corporate strategic alliance and why would a company want to develop one? Are strategic alliances necessary for a company to expand internationally?
3 - Describe the three types of strategic alliances and the reasons why companies develop them. Describe situations when each is most appropriate to adopt.
4 - Cooperative strategies seem to be a good idea. Discuss the difference between a business-level cooperative strategy and a corporate-level cooperative strategy. Under what circumstances would you choose to develop a cooperative strategy? When is it not a good idea?
Key terms: Regionalism, strategic alliance, agreement, competitiveness, corporations
1. There are countless reasons why companies/corporations expand internationally. For example, if a corporation expands globally there is a wider market available to distribute business risk, or perhaps a corporation needs to expand in order to take advantage of core competencies. In addition, corporations expand to access new markets and customers, and increase competitiveness and reduce costs. There is a cost associated with expanding internationally known as the liability of foreignness, and this is considered a disadvantage to the corporation's competitiveness. A regional concentration of economic activities such as, the European Union can be defined as regionalism. Economic activities include business, domestic and international trade, manufacturing, and services. Regionalism can make it difficult for expanding corporations to gain market share internationally.
2. When two organizations strategically align themselves through agreements with competitive corporations that is a strategic alliance. The agreement to cooperate with each other does not reach the level of a joint venture partnership or a merger. The concept of a strategic alliance is related to combining resources, competencies, and ...