Creating Meaningful Switching Options in International Operations
Article Abstract:
By entering foreign markets through the use of local operators or intermediaries, such as licensees and distributors, companies can reduce their risk exposure and the resource demands of internationalisation. However, at a later stage, the entrant firms may want to shift to a higher control mode--perhaps a sales or production subsidiary. A difficult question, therefore, is how a company can create meaningful strategic options so as to facilitate a subsequent shift. In this article, issues surrounding the achievement of strategic flexibility in operation mode use are examined. A matrix is developed to illuminate the options of revealing or concealing future intentions regarding integration or the termination of a relationship with the foreign partner. A number of company cases are presented to illustrate the way in which these options may be created to facilitate a future shift from one operation mode to another within a foreign market.
Publication Name: Long Range Planning
Subject: Economics
ISSN: 0024-6301
Year: 2000
User Contributions:
Comment about this article or add new information about this topic:
Incumbents' use of pre-entry alliances before expansion into new technical subfields of an industry
Article Abstract:
Most firms which have established themselves in their particular industries remain wary of venturing into developing technical subfields because of uncertain market conditions. Big corporations would rather form strategic alliances with other firms to penetrate such markets. Through these alliances, companies will be able to realize the market's worth and gather information which will eliminate uncertainty.
Publication Name: Journal of Economic Behavior & Organization
Subject: Economics
ISSN: 0167-2681
Year: 1992
User Contributions:
Comment about this article or add new information about this topic:
- Abstracts: Asking the right questions in business retention and expansion surveys. Sports-based economic development
- Abstracts: Farm equipment shows grow with technology and international appeal. Case uses experimental farm site to understand 'systems' of agriculture
- Abstracts: Intriguing pendula: founding metaphors in the analysis of economic fluctuations. Economic geography: the great half-century
- Abstracts: Sequential investments and options to own. Optimal complementary auctions. Public and private investments in Greece: Complementary or substitute 'goods'?
- Abstracts: Breaking into China. Strategic Lessons from the Asian Crisis. The Strategic Reaction of Domestic Firms to Foreign MNC Dominance: the Israeli Experience