MAN 6636: GLOBAL STRATEGIC MANAGEMENT, SPRING 2013

INSTRUCTOR: Professor Lindy Archambeau OFFICE: 211h Stuzin Hall OFFICE HOURS: By appointment TELEPHONE: 352-392-1734 EMAIL lindy.archambeau@warrington.ufl.edu MAILBOX: 211 Stuzin Course Materials REQUIRED: Course Packet, Electronic Reserve & Class Materials on Sakai Each student must purchase the course packet designed specifically for this class MAN 6636. The packet is available at Target Copy, 22 NW 13th Street, (352) 376-3826. (NOTE: PURCHASING THE COURSEPACK IS A REQUIREMENT COPYING CASES IS A VIOLATION OF THE ACADEMIC HONOR CODE). Electronic Reserve Website: http://www.uflib.ufl.edu/ Under Course Reserves Tab, you will need to login using gatorlink and then select this course, MAN 6636, to access the assigned readings. OPTIONAL: Supplemental Text Bartlett, C. A. & Ghoshal, S. 2001. Managing across borders: The transnational solution. HBS. OPTIONAL: Supplemental Readings, Articles (Current Events), etc. Available on Sakai COURSE DESCRIPTION

Globalization and technological advances have created exciting opportunities for managers to pursue strategies in markets around the world. These developments also present managers with enormous complexity in terms of understanding diverse economic, political and social environments, managing the organizational tension inherent in coordinating activities worldwide, fostering innovation and crosscultural learning and interacting with employees and partners from diverse cultures. This course will examine the key activities undertaken by managers to evaluate new market opportunities, develop market entry strategies, and effectively manage expansion in international markets. Problems and decisions are analyzed from the point of view of the general manager or chief executive who has responsibility for the strategy of the entire organization. By focusing on strategy decisions, we will be concerned with the choice of goals as well as the organization and management of scarce resources to pursue these goals within the context of an imperfect, changing, and competitive environment. This process requires the successful focusing of the distinctive strengths of a company on market opportunities through an internally consistent competitive strategy. We will examine how firms formulate strategy in order to create a sustainable competitive advantage.

This course focuses on the analysis of the strategic challenges facing the business enterprise in the global environment. The class will explore how multinational corporations create competitive advantage and success in the complex global arena. It will cover the following areas: Motivation and process for overseas expansion Differences in the international context Creating effective strategy, structure and capabilities Enabling and facilitating worldwide innovation Managing cross border collaboration

PURPOSE OF THIS COURSE The course provides global managers with a clear conceptual understanding of: The fundamental factors affecting the international expansion of the firm as distinct from purely domestic factors. The persistence of deep cross-national differences in the world that affect the strategy, performance, and value of the multinational firm. The optimal sequence, speed and mode of international expansion depending on the characteristics of the industry, the firm and the host country. The models for organizing and managing a multinational network of subsidiaries, including how to coordinate and transfer knowledge across borders.

Course takeaways: A toolkit of conceptual frameworks needed to navigate through the often contradictory mass of information about how international competition takes place. A set of criteria for evaluating exactly how global strategy will help enhance the firms long-term profitability and value. A clear understanding of how to measure and interpret the effects of economic, cultural, financial, political and social factors on international management decisions.

COURSE EVALUATION 1. Participation (Individual based) a. 4 1pg Summaries @2.5% each b. Collective learning and attendance c. Contributions to class discussion 2. Case Analysis a. 2 3-page case analysis @ 15% each 3. Term Project (Team based) 4. Exam 30% 10% 10% 10% 30% 25% 15% 100%

COURSE POLICIES 1. Participation This is a case driven course. Therefore, class participation is a critical ingredient in the learning process. In order to derive the maximum benefit from the case method, it is imperative that you come prepared to each session. At a minimum, the well-prepared student comes to class having digested the readings and applied the salience concepts in analyzing the case under discussion. As part of this process, each student will submit 4 1 page executive summaries over the course of the term. Each summary is worth 2.5 percent of your total grade. The requirements for this deliverable are: 1. 1 page, single spaced document with a font size no smaller than 11 2. The document must be in paragraph form but may include points to highlight key findings 3. You may choose any case, except for the ones where your team is the designated expert (see case analysis section for more details) 4. Each case summary is due 1 day prior to the time the case is being discussed, via electronic submission on Sakai under the assignments tab Class discussion is also a critical ingredient to the learning process. Class participation provides an opportunity to develop oral communication skills including the ability to concisely and persuasively present your ideas and to effectively respond to the comments of other classmates. Participation in class discussion is worth twenty percent of your total grade. Class participation will be graded based on the assessment of the professor for each class and with (non)binding input from your peer evaluations (see Appendix 2a & 2b for a sample of this form). The actual peer evaluation will be sent to each student as an email via Sakai at the end of the term. While I will lead class discussions, the intention is not to lecture for the entire class period. Instead, I will facilitate and encourage students to develop their own insights and thoughts on the assigned material. Each session, there will be at least one team who will take the lead during the case discussion by relating it to the theoretical readings, proposing additional questions for discussion and offer a brief update of the case. Finally, most issues, cases and problems do not have one right answer, although there are some answers that are more correct than others. Consequently, being right or wrong should not be of concern when participating. I am interested in your point of view especially the rationale behind the conclusions you have drawn based on the information at hand. 2. Case Analysis Each student must complete two case analyses over the course of the term. You must sign-up for the two cases electronic on the Sakai website. The cases along with their discussion questions are located on Sakai under the Sign-up Tool under the appropriate date. There are 11 cases. Each case is limited to the number of slots. These slots will be available on a first come, first choose basis. The deliverable is the preparation of a three page case analysis report. This report should briefly summarize the current situation then focus on analyzing the facts contained in the case in order to discern the proper course of action(s) needed to rectify the situation at hand. You should write this report as if you are a consultant reporting to a superior. You should assume that this person is familiar with the case situation, therefore, she/he will be bored if you analysis simply describes the facts provided in the case. Focus on your

analysis and try to avoid making vague statements and suggestions such as we need to be more competitive. Make solid, actionable recommendations. In order to get paid (in this case a good grade), you do not want to repeat information that the client always knows. The format of the written part of the deliverable is: 1. Maximum length is three pages, typed and doubled spaced, excluding the title page and any appropriate appendices 2. On the title page, include a 1 paragraph executive summary ( less than 100 words) 3. Term Project This deliverable is a team based project, first writing your own case study and then answering this question: How to solve a strategic problem in global strategy? in the context of your case study. The first part will be a case study focusing on a critical strategic problem. Examples of a critical strategic problem include: 1. 2. 3. 4. How to enter a Foreign Market? How to establish a global R&D network? How to use strategic alliances to improve your competitive positions? How to modify your current global strategy.

The format of this deliverable should mimic the format of the cases we are studying during this case. The first part should have enough details on the background of the firm and focus on a difficult decision. This part should be approximately 8 to 10 pages. The second part will be your analysis and recommendations of how the firm should proceed. This part should be approximately 5 pages. Altogether, the length of this project should be approximately 15 pages excluding figures and tables. Under no circumstances can the total report be less than 10 pages or more than 20 pages. The best papers will be insightful, going beyond the obvious, and present the story behind the story. Outside research is expected. You are expected to provide enough background information of the situation so that the reader can draw his/her own conclusions. Please document the sources used in either footnotes or a bibliography at the end of the document. 4. Final Exam On Tuesday, April 30th, a final exam is scheduled during your regular class period. This is an individual assignment. The in-class final exam is open book. You will have up to 1 hour and 40 minutes to complete the exam. Bring your laptop. You will need a word processor and access to Sakai. Academic Honesty It is expected that you will neither participate in nor condone activities such as cheating or plagiarism. By placing your names on assignments, you are affirming that the contents are your original work. Student Honor Code: In adopting this Honor Code, the students of the University of Florida recognize that academic honesty and integrity are fundamental values of the University community. Students who enroll at the University commit to holding themselves and their peers to the high standard of honor

required by the Honor Code. Any individual who becomes aware of a violation of the Honor Code is bound by honor to take corrective action. A student-run Honor Court and faculty support are crucial to the success of the Honor Code. The quality of a University of Florida education is dependent upon the community acceptance and enforcement of the Honor Code. Academic Honesty Guidelines: The academic community of students and faculty at the University of Florida strives to develop, sustain and protect an environment of honesty, trust and respect. Students are expected to pursue knowledge with integrity. Exhibiting honesty in academic pursuits and reporting violations of the Academic Honesty Guidelines will encourage others to act with integrity. Violations of the Academic Honesty Guidelines shall result in judicial action and a student being subject to the sanctions in paragraph XI of the Student Conduct Code. For more information on which conduct constitutes a violation of the Academic Honesty Guidelines (University of Florida Rule 6C1- 4.017), see http://regulations.ufl.edu/chapter4/4017.pdf. OTHER RESOURCES Student Mental Health: Students may lead very demanding lives as they struggle with the developmental tasks of physical maturation, interpersonal relationships, and occupational preparation. Even a mild impairment in psychological functioning can result in significant disruption of a student's ability to learn effectively and relate appropriately. Student Mental Health Services (SMHS) of the University of Florida, a division of the Student HealthCare Center, is dedicated to assisting students toward successful completion of educational programs through enhancing and maintaining their psychological and emotional well-being, providing support in situational crises, and treating them when functioning is impaired by stress or psychiatric disorders. SMHS is located in Room 245 of the Infirmary, and available by telephone to (352) 392-1171. Hours are Monday through Friday 8 am 4:30 pm. All services are confidential. Students with Disabilities: Students requesting classroom accommodation must first register with the Dean of Students Office. The Dean of Students Office will provide documentation to the student who must then provide this documentation to the Instructor when requesting accommodation.

Course Schedule of Readings

Session 1 2 3 4 5 Date 3/12/13 3/14/13 3/19/13 3/21/13 3/26/13 TOPICS Introduction Critical Concepts in Strategy Critical Concepts in Strategy Critical Concepts in Strategy Global Environmental Analysis: Frameworks Global Environmental Analysis: Frameworks Global Value Creation Global Business: Designing and Managing Global Innovation Entry Strategies: Strategic Alliances Forming an International JV Politics and Societal Influence IJVs Managing in Emerging Markets Social Dilemmas in Global Strategies Final READINGS Syllabus Article: What is Strategy? Article: How competitive forces shape strategy? Case: Global Wine War 2009 Article: The Quest for Resilience Case: Netflix Article: Can you say what your strategy is? Case: Walmart Stores, Inc.: Dominating Global Retailing Article: Distance Still Matters Case: Globalization of Cemex Article: Competitive Advantage of Nations Case: Swatch and the Global Watch Industry Article: Managing Differences: The AAA Triangle Case: GE Medical Systems Article: Organizing for Worldwide Effectiveness Case: Phillips vs Matsushita Article: Building Effective R&D Capabilities C: Siemens AG: Global Development Strategy (A) Article R: Global Logic of Strategic Alliances Case: Eli Lilly: Rethinking the JV Article: Collaborate with your Competitorsand Win. Case: Nora-Sakari Article: The Hidden Challenge of Cross-Border Negotiations Case: Enron and Dahbol Power Company Article: Serving the Poor Profitably Case: LG Electronics: Global Strategy Article: Changing the Role of Top Management: Beyond Strategy to Purpose Case: Blood Bananas: Chiquita in Columbia COURSE ASSIGNMENTS Sign- up for Case Analysis Case Brief #1 Case Brief #2 Case Brief #3 Case Brief #4

3/28/13

Case Brief #5

7 8 9 10

4/2/13 4/4/13 4/9/13 4/11/13

Case Brief #6 Case Brief #7 Case Brief #8

Case Brief #9 Not Eligible Case Brief #10 Case Brief #11 Not Eligible

11 12 13 14 15

4/16/13 4/18/13 4/23/13 4/25/13 4/30/13

COURSE PROGRAM

Session 1: Introduction Read: Syllabus Article: What is Strategy? Session 2: Critical Concepts in Strategy Read: Article: How Competitive Forces Shape Strategy? Case: The Wine Industry Case Questions: 1. Analyze the wine industry. Is this an attractive industry? What is the basis for competitive advantage? 2. Is this a global industry? 3. Why have French firms dominated this industry in the past? 4. Why is the French dominance now being threatened by New World producers? 5. What will this industry look like in the future? Session 3: Firm Analysis Read: Article: The Quest for Resilience Case: Netflix, Inc. Case Questions: 1. Is this industry attractive? 2. Discuss the advantages and disadvantages of Netflixs strategy? 3. is their strategy sustainable? What impact does the external environment play? 6. How should Netflix respond to the emergence of Video-on-Demand?

Session 4: Firm Analysis Read: Article: Can you say what your strategy is? Case: Wal-Mart Stores, Inc.: Dominating Global Retailing Case Questions: 1. How does the retail industry structure help explain Wal-Marts success? 2. What are the companys resources/sources of competitive advantage? How have they delivered value? Are these sources sustainable? 3. What are the best practices that the company has been able to transfer from its home operations to its ventures abroad? What are the practices that have not worked? 4. What is your prognosis for the future success of Wal-Mart in the U.S. and abroad? What changes does the company have to make to ensure continued success?

Session 5: Global Environmental Frameworks Read: Article: Distance Still Matters Case: The Globalization of CEMEX Case Questions:

1. What benefits have CEMEX and other global competitors in cement derived from globalization? 2. How was CEMEX managed to outperform its leading global competitors? Particularly, Holderbank? 3. Using the CAGE framework for country analysis, explain why their global expansion was so successful and discuss which countries Cemex should focus on for its future expansion. Session 6: Global Environmental Frameworks Read: Article: The Competitive Advantage of Nations Case: Swatch and the Global Watch Industry Case Questions: 1. In what ways is the watch industry global? Compare and contrast the drivers of the watch industry with those of a multi-domestic industry, for example bakeries. 2. Why did the Swiss emerge as the European leader by the late 1800s and the worldwide leader in the 1930s? Why Switzerland as opposed to some other more economically powerful countries? 3. Why did Timex succeed the Swiss as world volume leader in the 1950s and 1960s? 4. Why did other major players, including the Japanese (Seiko, Citizen) replace the Americans as both unit volume and monetary volume leaders? Session 7: Global Value Creation Read: Article: Managing Differences: The AAA Triangle Case: General Electric Medical Systems, 2002 Case Questions: 1. What is the underlying logic behind the global product idea? What are the expected costs and benefits? 2. Should the global product philosophy be changed or altered to suit the China market? Please identify both sides of the argument and take a position explaining the rationale behind your stand. Does it make economic sense? Strategic sense? 3. Should GEMS be aggressively pursuing genomics and healthcare-IT related opportunities in addition to or instead of the China opportunity? 4. What priorities would you suggest? Explain your reasoning carefully. Session 8: Global Business: Designing and Managing the MNE Read: Article: Organizing for Worldwide Effectiveness: The transnational solution Case: Philips versus Matsushita: The Competitive Battle Continues Case Questions: 1. How did Philips become the leading consumer electronics company in the world? Based on what distinctive competencies? 2. What role has Philips administrative heritage played in its success/failure? 3. How did Matsushita succeed in displacing Phillips? Based on what distinctive competencies? 4. What role has Philips administrative heritage played in its success/failure? 5. What recommendations would you make to Gerald Kleisterlee? To Eumio Ohtsubo? Session 9 Global Innovation

Read: Article: Building Effective R&D Capabilities Case: AG Siemens A & B Case Questions 1. How would you characterize Siemens global development strategy? Why does it have regional development centers around the world? 2. What are the differences between RDCs in India, Germany and the U.S? How are these issues managed and resolved? 3. How should senior management respond to the NetManager Project crisis? 4. What are you recommendations for the Surpass Project? Session 10 Entry Strategies for Global Expansion: Strategic Alliances Read: Article: Global Logic of Strategic Alliances Case: 6-3 Eli Lilly in India: Rethinking the Joint Venture Strategy Case Questions 1. Did Eli Lilly pursue the right strategy to enter the Indian Market? 2. How would assess the overall performance of the alliance? Who gained (or learned) more from relationship? 3. What action would you recommend regarding the Ranbaxy Partnership? What are the implications of your recommendation? Session 11 Forming an International Joint Venture Read: Article: Collaborate with your Competitors - and Win Case: Nora-Sakari: A Proposed JV in Malaysia (*not eligible for submission) Case Questions 1. Why have the negotiations failed to result in agreement? Is the formation of the JV between Nora and Sakari the best option for both companies to achieve their respective objectives? 2. As Zainal, what would you do ensure Nora fulfills the TMB? 3. If Zainal decides to renegotiate (and assuming that Kuusisto agrees), how should the deal be restructured? From Noras perspective? From Sakaris perspective? Note: Even Groups prepare Noras side of negotiation; Odd Groups prepare Sakaris side of negotiation Session 12 Politics and Societal Influence IJVs Read: Article: The Hidden Challenge of Cross-Border Negotiations Case: Enron and the Dahbol Power Company Case Questions: 1. Evaluate the market potential for power in India. Does it appear to be an attractive industry to enter circa 1991 when the country first started attracting FDI in the power sector? 2. What are the strengths and weaknesses that Enron brought to the table at the time when the decision was made to enter India? Focus on company specific dimensions rather than project specific dimensions. 3. What were the risks associated with the project? How did Enron mitigate some of these risks? 4. If you were given the responsibility for engineering for the Dahbol entry, what are some of the steps you would have taken that EDC did not? What lessons have you learnt from the Enron story? Session 13 Managing in Emerging Markets

Read: Article: Serving the Poor Profitably Case: LG Electronics: Global Strategy in Emerging Markets Case Questions 1. What were the key strengths of the Korean electronics industry during the formative years? How did firms leverage these advantages to enter developed country markets? 2. Trace the strategic growth of LG Electronics. Were there any distinct patterns in terms of the companys approach to emerging markets? Trace the commonalities across its strategies in the BRIC countries. 3. What are critical points of learning that can be distilled from its success in emerging markets? How may these advantages be leveraged to compete in developed countries? Are the advantages transferable?
Session 14: Social Dilemmas in Global Strategy Read: Article: Changing the Role of Top Management: Beyond Strategy to Purpose Case: Blood Bananas: Chiquita in Colombia (*not eligible for submission) Case Questions: 1. What do you think were the root causes for Chiquitas actions in Colombia that ultimately led to their conviction? 2. Do you think Chiquita or its managers had a choice? Why or why not? 3. What other companies or industries do you think should be worried about Chiquitas experience? How does this story change your perspective on doing business abroad? 4. What can current CEO Fernando Aguirre do now to restore Chiquitas reputation and ensure future competitiveness?

Appendix 1: Grading Criteria - Writing Assignments (Case Analysis and Term Projects)

Excellent Demonstrated Knowledge: Identifies key issues Includes Significant facts/supporting details Demonstrated Reasoning: Logically analyzes all relevant evidence Critical evaluates evidence use concepts for the course Reaches informed, appropriate conclusions Presentation: Style and organization Examples/Exhibits Total

Good

Sufficient

Needs Improvement

Unacceptable

Appendix 2a. Peer Participation Evaluation Form In my evaluation, the following five students excluding myself, in no particular order, have most significantly contributed to our discussion. In other words, they deserve the full 20% of the class participation grade. You should make this evaluation by yourself, not jointly with your colleagues. You should identify members of your team with a *. Notes: The information you submit is complete confidential. The limit of five students does not imply that only five students can attain excellence in class participation. Submitting this form is purely voluntary. Your grade will not be affected if you choose not to participate 1.____________________________________________________________________ 2.____________________________________________________________________ 3.____________________________________________________________________ 4.____________________________________________________________________ 5.____________________________________________________________________

Appendix 2b. Peer Evaluation of Individual Participation in the Team Assignments At the end of the semester, each student will be evaluated by the other members of their group with respect to the level of participation put into each team project. This evaluation will be taken into consideration when determining the students overall participation grade. Team: Allocate a total of 100 points across all team members Name Yourself Member 1 Member 2 Member 3 Member 4 Member 5 COMMENTS: ___________________ ___________________ ___________________ ___________________ ___________________ ___________________ Score _________ _________ _________ _________ _________ _________ 100 Points