AN AL YT IC AL I NSI GH T, GL O BAL L E AD ER S

DEVELOPING A GLOBAL BUSINESS STRATEGY [MGMT 688] Spring 2014 Professor: E-mail: Office Hrs: Fabrice Lumineau lumineau@purdue.edu At your convenience Email for appointment

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Purdue University Krannert School of Management MANAGEMENT 688 SPRING 2014 DEVELOPING A GLOBAL BUSINESS STRATEGY Professor Fabrice Lumineau

Office: Krannert Building 530 Email: lumineau@purdue.edu Office Hours: At your convenience Email for appointment Class Hours: Monday/Wednesday/(Friday) 8:00-9:30am (RAWLS 3058) Required Text: Course pack (Boiler Copymaker Center, Room 157 in Purdue Memorial Union) Optional Text: Peng, M. W. (2009). Global Strategy. 2nd edition. South-Western Cengage Learning (ISBN-13: 978-0-324-59099-9) Co-Requisites: MGMT 650, MGMT 659 COURSE OVERVIEW This course focuses on the strategic challenges confronting firms and managers competing internationally. The overall theme of the course is understanding the MNC: how it is structured, how it competes, and how we explain persistent differences in performance between the MNC and its various rivals. The aim of the course is to understand how strategy carried out by the MNC in an international context is different from firm strategy in a purely domestic setting. In working through the course, it will be helpful to keep in mind that there are few if any universal rules to govern the actions of MNCs. The right thing to do in a particular business setting may have limited applicability to other situations. Global strategic management is a study of contingencies. This course is designed to give you a mode of thinking about such contingencies. Major topics for the course include motivations and challenges of internationalization, foreign market entry strategies, analyzing global industries, building competitive advantage in global industries, and the influence of culture and institutions. We will discuss the strategies of both manufacturing and service firms and balance between firms based in the United States and in other parts of the world such as Central and South America, Europe, Africa, and Asia.

LEARNING OBJECTIVES A combination of texts, case studies, and class discussions will enable you to gain an understanding of the strategic issues confronting firms operating internationally. This course should help you to get a better understanding of: Concepts for understanding globalization. Frameworks for developing global strategies and organization. Frameworks for managerial action at various levels in the multi-national corporation. Frameworks for leveraging innovations in the multi-national. Frameworks for effective market entry into emerging non-traditional markets. Frameworks for integration of global mergers and acquisitions.

COURSE REQUIREMENTS AND GRADING Discussion Participation Developing Your Own Case Study Country Presentation 40% 40% 20%

Discussion Participation Since the course relies heavily on the case method and student involvement, attendance and participation are very important. As in the business world, the cases are rich in detail, yet openended and incomplete at the same time. To achieve our course objectives and for our learning to be effective, it is critical you diligently prepare for and actively participate in meaningful case discussions and debates, exchange views, and make mutual contributions. We do not engage in these to provide a definite answer but rather to be aware of the issues and the various perspectives on them. Please do not read a case as you would read a book chapter or a magazine article; rather, put yourself in the role of the decision maker. Fundamentally, a good contribution involves presenting a clear opinion, expressing it civilly, and supporting the opinion with sound logic. In addition, we all have the responsibility to create an environment where each member of the class feels comfortable offering his or her opinion; thus, knowing how to listen is also important. Grading Criteria: Relevance Do your comments speak directly to the issues and concepts being addressed? Do they extend our understanding of those issues or concepts? Do they reflect your adequate preparation to participate in the discussion? Value added Do your comments reflect active listening to the comments of other class members? Have they incorporated insights introduced earlier and built upon them?

Substance Do your comments make a real contribution to the ideas being exchanged? Has anything new been gained from your contribution to the discussion? Persuasiveness Have your points been well articulated, argued, and supported, such that others take note of the convincing nature of your points? Questioning Have your comments reasonably questioned the comments of others or challenged their assumptions without disparaging the person who offered them? Amount of participation (this does NOT mean dominating the discussion, rather frequency of additive comments). Remember it is the quality of your participation, not the quantity (or air time), that will lead to good performance in class discussion.

Over the term, I will periodically post on Katalyst how I think you are doing in this regard. The periodic posting will be cumulative up to that point in the semester and will be one of four categories: A-level, B-level, C-level, and Needs Improvement: A-Level class participation: The student consistently attends class, consistently contributes to case discussions, and consistently demonstrates superior understanding and insights. B-Level class participation: The student consistently attends class, often contributes to case discussions, and occasionally demonstrates superior understanding and insights. C-Level class participation: The student inconsistently attends class, inconsistently contributes to case discussions, and rarely demonstrates superior understanding and insights. Needs Improvement class participation: The student has missed many classes and/or does not contribute to the discussions. There is no reason that any student should be in this category.

Although attendance is not directly graded, I have found that students who miss class rarely choose to create and share knowledge in a meaningful way. Developing Your Own Case Study This is a group-based exercise (1) to write your own case study (6-8 pages) and (2) to write your own case analysis (2-4 pages)for a combined total of 10 pages excluding the title page and any attachments, such as figures, tables, appendix, and references. Your guiding question is: How to solve a strategic problem in global strategy? The first part will be a case study focusing on one specific hard-to-tackle strategic problem. Examples include: (1) How to enter the Italian market? (2) How to govern a newly acquired foreign company? Or (3) How to deal with some ethical dilemmas in a foreign country? Try to follow the format of the cases that we study during the module, give enough details on the background of the firm, and focus on a challenging decision. This part should take approximately 6-8 pages. The second part will be your analysis and recommendations to these managers in terms of how to proceed, which should take about 2-4 pagesat least 1 page should be devoted to recommendations. All together, the ideal length is 10 pages, excluding attachments such as figures and tables. In terms of the attachments, please be reasonable. Under no circumstances can the total report (all inclusive) exceed 20 pagesI will stop reading after p. 20. 4

Grading Criteria: Analysis: Use of concepts and theories applied to the case. Qualitative and quantitative data, assessments, interpretations. Investigative efforts: Ideally, use of both primary and secondary data. Original data from interviews, phone calls, or emails with managers are particularly appreciated. Please properly document your sources either in footnotes or endnotes with a reference list attached at the end of your work. Evidence: Strength of facts, references, citations, sources, examples and illustrations. Critical thinking: Identify relevant issues, analyze interrelationships, and conceptualize solutions; see the big picture and understand how the various parts fit and function together. The best case studies are insightful, going beyond the most obvious lessons to draw out the story behind the story. Creative, compelling, and convincing: Not stating the obvious, emphasizing the interesting and important, grabbing audience attention from introduction through takeaways, unified theme. Logical flow, clarity of the story line. Effectiveness of presentation (including speech posture, maintaining eye contact with the audience instead of reading off the script, use of visual aids, timing). Effectiveness of written reports (including readability, flow, logic, and organization; writing mechanics, such as free of grammatical and spelling errors, use of sections and headings, and page numbering, use of literature and attachments such as graphs, tables, and calculations, whenever applicable). Lessons learned: Implications of how businesses can succeed by going global. Q&A: Ability for all group members to answer questions succinctly but with appropriate detail.

Normally, everybody in the group gets the same grade. However, if there is any significant free rider, please file a complaint against this individual by sending me a detailed email. Your complaint will be stronger if there are other members in your group who also file their complaints. Please note this complaint mechanism is totally optional, and I hope none will need to use it. Please also take note that: Careful editing is expected. It is tempting for groups to assign individual responsibilities to their members. The result is a series of unrelated mini presentations that lack clarity and cohesion. One inch margins should be left on four sides of the paper, and the font size cannot be smaller than 10. On the title page, everybodys name and email is required. Also on the title page, include a 1-paragraph executive summary (less than 100 words). Double space your main text (references and tables can use single space). 5

Each group has to send me their written report and the slides of their presentation by email by Tuesday, April 22nd (2:00pm). Each group will have 25 minutes to present their case study to the rest of the class (in Class 12 or Class 13): with around 15 minutes for the presentation of the case and their recommendations and 10 minutes of Q&As. Please bring a handout for everyone the day of your presentation. Country Presentation You will have to make a 15-minute presentation about your country of origin. It is an individual or collective assignment depending on the number of students from a given country. Your guiding question is: What should we know to do business in this country? Your presentation should focus on practical recommendations (like if you had to brief a colleague going to do business for the first time in this country). You will find below a list of indicative topics. However, do not try to talk about everything. You should focus on what is the most relevant and specific to this country. Key industry clusters and sectors, primary types of business structures and ownership / governance approaches, national institutions, market requirements, etc. Political, regulatory, and legal environments (e.g., privatization, taxation, entry requirements, preferential trade agreements, etc.); government spending (e.g., % GDP), taxes, fiscal / monetary policy; capital controls (e.g., repatriation, currency flows, etc.); relationships with non-governmental organizations (e.g., IMF, Transparency International, UN, World Bank, etc.); public interest groups. Natural resources and basic materials (e.g., energy, food, minerals, etc.), physical and technical infrastructure (e.g., the ability to support its technology needs, access to computing technology, computer literacy, reliable power, etc.) Demographics and population characteristics (e.g., the age distribution and what effect trends will have on such future needs as retirements and education, education level and skills available, cost of living vs. wage structure, etc.) Social conditions (e.g., population density, wealth distribution, radicalism); social stability (e.g., conflicts, riots, demonstrations, crises, assassinations, guerrilla warfare, internal security forces, ethnic tension); social cultures (e.g., business etiquette), value expectations, ethical norms, moral issues, etc. Macroeconomic indicators (e.g., GNP, inflation, foreign debt, trade, FDI, etc.) and historical trends, time lines, and projections of key events and unique characteristics.

Please bring a handout for everyone the day of your presentation. The grading criteria are similar to the criteria used for grading the Developing Your Own Case Study project.

PROFESSIONAL CONDUCT Professional conduct is built upon the idea of mutual respect. Such conduct includes, but is not limited to the following: Plagiarism. Plagiarism is a serious offense and will not be tolerated. All required papers may be subject to submission for textual similarity review to iThenticate for the detection of plagiarism. Arriving on time. Late arrivals are disruptive to both lectures and class discussion, and shows disrespect to those who are on time. Please be punctual. Minimizing disruptions. All cell phones and pagers should be turned off during class. You should not leave and re-enter when class is in session. You should avoid engaging in side conversations after class has begun. Being prepared for class. You should be ready to discuss any assigned readings and cases and frame ideas and thoughts within the concepts that we learn within the class. Academic integrity. Purdue University and the Krannert School of Management support and expect the highest standards of academic honesty. Just as integrity is valued and important in the workplace, it is also the foundation for how we should conduct ourselves at Krannert. If at any time you are unsure as to what is allowed, please contact the Instructor.

DEVELOPING A GLOBAL BUSINESS STRATEGY MGMT 688 TENTATIVE SCHEDULE Class 1: Monday, March 24th Introduction: Strategizing around the globe Class 2: Wednesday, March 26th Distance, diversity, institutions, and culture Class 3: Friday, March 28th Understanding the role of political and legal environments Prepare case: Wal-Mart in Europe Class 4: Monday, March 31st Strategizing, structuring, and learning around the world Prepare case: Kent Chemical: Organizing for International Growth Class 5: Wednesday, April 2nd Entering foreign markets via franchising Prepare case: Levendary Caf: The China Challenge Class 6: Monday, April 7th Entering foreign markets via international alliances and M&As Prepare case: Eli Lilly in India: Rethinking the Joint Venture Strategy Class 7: Wednesday, April 9th Entering foreign markets: Offshoring Prepare case: Scotts Miracle-Gro: The Spreader Sourcing Decision Class 8: Friday, April 11th Adapting your marketing strategy Prepare case: P&G Japan: The SK-II Globalization Project Class 9: Monday, April 14th Adapting your HRM strategy Prepare case: Development of a Multinational Personnel Selection System Class 10: Wednesday, April 16th The Base of the Pyramid Prepare case: Celtel Nigeria: Towards Serving the Rural Poor Class 11: Monday, April 21st Ethics and corporate social responsibility for MNCs Prepare case: The Carlson Company and Global Corporate Citizenship

Class 12: Wednesday, April 23rd Presentations Class 13: Monday, April 28th Presentations Class 14: Wednesday, April 30th Wrap-up & International potluck