Chapter 11: International Strategy and Organization

International area structure

Organizational structure that organizes a company's entire global operations into countries or geographic regions.

Global strategy

Offering the same products using the same marketing strategy in all national markets.

Global product structure

Organizational structure that divides worldwide operations according to a company's products areas.

Multinational (multidomestic) strategy

Adapting products and their marketing strategies in each national market to suit local preferences.

Stakeholders

All parties, ranging from suppliers and employees to stockholders and consumers, who are affected by a company's activities.

Chains of command

Lines of authority that run from top management to individual employees and that specify internal reporting relationships.

International division structure

Organizational structure that separates domestic from international business activities by creating a separate international division with its own manager.

Global matrix structure

Organizational structure that splits the chain of command between product and area divisions.

Value-chain analysis

Process of dividing a company's activities into primary and support activities and identifying those that create value for customers.

Planning

Process of identifying and selecting an organization's objectives and deciding how the organization will achieve those objectives.

Strategy

Set of planned actions taken by managers to help a company meet its objectives.

Core competency

Special ability of a company that competitors find extremely difficult impossible to equal.

Stability strategy

Strategy designed to guard against change and used by corporations to avoid either growth or retrenchment.

Growth strategy

Strategy designed to increase the scale (size of activities) or scope (kinds of activities) of a corporation's operations.

Combination strategy

Strategy designed to mix growth, retrenchment, and stability strategies across a corporation's business units.

Retrenchment strategy

Strategy designed to reduce the scale or scope of a corporation's businesses.

Differentiation strategy

Strategy in which a company designs its products to be perceived as unique by buyers throughout its industry.

Low-cost leadership strategy

Strategy in which a company exploits economies of scale to have the lowest cost structure of any competitor in its industry.

Focus strategy

Strategy in which a company focuses on serving the needs of a narrowly defined market segment by being the low-cost leader, by differentiating its product or both.

Cross-functional team

Team composed of employees who work at a similar levels in different functional departments.

Self-managed team

Team in which the employees from a single department take on the responsibilities of their former supervisors.

Global team

Team of top managers from both headquarters and international subsidiaries who meet to develop solutions to company-wide problems.

Organizational structure

Way in which a company divides its activities among separate units and coordinates activities among those units.

Mission Statement

Written statement of why a company exists and what it plans to accomplish.