Your task is to conduct a global industry comparative analysis that will help develop the strategy for expanding your organization’s products into a new country (Netherlands). Note that the term products will refer to products, services, or a combination of the two.
In this fictional market expansion, your analysis will examine a real-life organization. To accomplish this task, you need to identify and assess the risks that your organization may encounter, such as market barriers and competition, as well as opportunities for success in the selected country. As the general manager for strategy, you have been tasked with the following:
· Analyze your organization’s resources and capabilities (organization profile).
· Evaluate the external environment, specifically the industry in which your organization operates (industry analysis).
· Select a new country as a market for expanding your organization’s products (country risk assessment). You will select one country from the provided list and assess the risks associated with doing business in that country, including risks presented by its economic, political, and cultural environments.
Based on your research, in three weeks you will make a recommendation to your senior vice president and CEO on expanding into this new market. Be sure to budget enough time for each of the 13 steps.
When you submit your project, your work will be evaluated using the competencies listed below. You can use the list below to self-check your work before submission.
Subject: targetting an 8-10% annual revenue increase
Hi,
Thanks for taking on this task for me. Here are the details—
This project will have three parts. Your first task is to conduct a thorough analysis of our resources and capabilities. This organization profile needs to address our existing strategy, people, skill sets, and what we can do to increase our market share and profitability. We know we won’t be able to make that 8 percent target domestically, so we need to set up shop overseas and tap into foreign customers. We’ll need a strategy, an analysis of the global competitors trading in our target market today, an overview of potential stakeholders, and an evaluation of our own capabilities. Finally, we must lay the analytical groundwork for what could become a fully developed business plan.
Although this is a major initiative, keep in mind that cost reduction is important. Assess what resources and personnel in the organization today can facilitate this move.
The second part of this project is to conduct an industry analysis to evaluate the external environment, including international competitors across our industry. How difficult will it be to enter a new international market from a position of strength? What should we produce that is both attractive to our customers and competitive in the new market? Are there any legal and regulatory issues we need to be aware of in the United States or abroad? In short, how can we best compete against those firms already doing business in our proposed area? How do we differentiate ourselves from them? What can we produce that our new country’s customers will want to buy? What about the potential to export from that country?
Finally, we’ll need a new country risk assessment. Which is the best country to expand into? Our strategy people have created a list of possibilities, but you will direct the analysis. It will be a new market for us—do not assume we have any infrastructure there. What are the risks in the proposed area and how can we mitigate those risks?
We need to be aware of legal, cultural, and market forces. You can recommend an expansion of our products into your chosen country, establish new value-chain activities, or strategize some combination of the two. That’s your call. You need to choose a country that will be the best fit for what we do and who we are.
Keep in mind that cost reduction is important. Let’s also look at countries that don’t demand wholesale re-engineering of our organizational processes. We need to expand, but let’s minimize risk and avoid needless costs where we can.
I’d like to see your report in three weeks.
Best,
Gustavo
1. Executive summary (see note below). 1 page. (Netherlands).
o summarizes the results of your analysis and how you arrived at the recommendation.
o What benefit can the company expect from this finding?
o What risk does this finding expose?
o What opportunity does this finding reveal?
o How does this finding relate to the ultimate success of what is being proposed?
2. Introduction (first page of paper body) 1-2 pages.
o states the purpose of the paper
o tells what the paper will do
o introduces the industry, country, and organization by name
Organization profile. 6–7 pages.
1. Analyzing organization’s resources and capabilities
· choice of organization
· organization profile
· Introduce the organization. What business is it in? For help, see Finding Company Information.
· Describe the company’s recent financial performance. Consult Finding a Company’s Annual Report for help.
· State where the organization is located and who its major customers are.
· Provide a brief history of the organization.
· State the size of the organization in terms of employees and revenues.
· Describe the organizational structure and identify major roles or functions of key individuals in the organization. For help, read Finding a Company’s Leadership Information
· strategy and competitive position of the organization
· organization’s competitive strategy statement
· market and financial performance
Industry analysis. 6–7 pages.
Understanding your organization’s industry
o trends in your industry
o Perform a detailed assessment of your organization’s current business strategy and recommend specific actions to gain and sustaining superior performance in relation to your organization’s competitors.
o Locate and review your organizations’s mission, vision, and core values. Review Global Strategy as Business Model Change. Then, apply what you have read to aid your evaluation of the strategic intent of your organization.
o Determine the strengths and weaknesses of your organization. In addition, determine the core competencies your organization can build on to create competitive advantage in the global environment. Read Global Competitive Advantage.
o Provide a clear picture of the organization’s operations (value chain), products, and position in the marketplace. Provide a summary of the core competencies, sales history, corporate structure, current leadership of the organization, and its global and domestic operations.
o analysis using Porter’s five forces Review and apply Porter’s five forces model to your analysis. Tailor the Porter model to the industry and integrate the complete figure of the model within the narrative of the report. What is the competitive structure of the industry? Describe the following:
· Entry barriers—How difficult is it to enter this industry? Are there several players competing for profitability? Are there significant threats of new entrants?
· Intensity of rivalry—Identify your organization’s top three competitors. Discuss industry rivalry. Is competition intense?
· Bargaining power of buyers—Who are the buyers in this industry? What kind of influence do buyers have on the competitors in the industry? Globalization makes it easier for buyers to source products worldwide. Is this the case in this industry?
· Bargaining power of suppliers—Provide a profile of the suppliers. Suppliers with significant industry influence can play a major role in the marketplace. For instance, DeBeers, the world’s leading supplier of diamonds, has enormous bargaining power in the diamond industry.
· Threat of substitutes—Carefully distinguish between similar products in the same industry. A substitute product for eye glasses would be contact lenses. Train travel is a substitute for travelling by car.
o
Country risk assessment. 1 page.
o Gustavo is seeking your advice regarding the international expansion and global market opportunity assessment. Review the blueprint for international expansion in the business journal article, Going International.
o You should also consider principles of international strategy for doing business in your selected country. What products are good candidates for generating additional revenue for your organization from expansion into the selected country? Please provide a detailed analysis as per final report format guidelines.
Analyzing country’s external environment 6-8 pages.
o selection of a new country for market expansion
o international expansion and global market opportunity assessment
o PESTEL analysis- do a pastel analysis
o global value chain: cultural issuesInclude information about the following cultural issues in your analysis:
· What cultural differences are likely to influence your organization’s operations (e.g., marketing, human resources, etc.) in this country? For background and guidance, consult International Cultural Differences and read about the impact of culture on best-practice production and operations management.
· Would your organization’s products need to be localized or marketed differently in this country? Explain why or why not. See Conducting Market Research for help.
· Are there any issues that your organization’s corporate social responsibility or compliance program may need to address while operating in this country?
o
Conclusion
o One- or two-page summary of your recommendations and your rationale
