MB0053-SLM-Unit-11

International Business Management Unit 11

Sikkim Manipal University Page No. 225

Unit 11 International Strategic Management

Structure:

11.1 Introduction

Objectives

11.2 Strategic Management

Nature of international strategic management

Advantages and disadvantages of formulating strategy

11.3 Strategic Planning

Types of planning

GAP analysis

Top-down vs. bottom-up planning

11.4 Strategic Management Process

Strategy formulation

Strategic implementation

11.5 Summary

11.6 Glossary

11.7 Terminal Questions

11.8 Answers

11.9 Caselet

11.1 Introduction

In the previous unit, you learned about international marketing and scanning

the market. You also learned about various modes of entry into the

international market. The global marketing strategies were also highlighted

for your understanding. In this unit, we will discuss more about international

strategic management.International strategic management refers to strategy

planning in international business to compete and ensure that they have a

long-term strategy for survival. Strategic management focuses on

developing a strong structure for an organisation’s business that will

gradually be changed by combining the efforts of each individual that the

organisation employs.

Objectives:

After studying this unit, you should be able to:

explain the nature of international strategic management.



list the advantages and disadvantages of strategy in international

business.

discuss strategic planning and its types.

evaluate the role of strategic management in international business.

describe strategic management process.

11.2 Strategic Management

The nature of strategic management plays a vital role in the international

business world. It is important to understand the term ‘strategic

management’ before discussing itsnature.

The term strategic management refers to the complete range of strategic-

decision making activity in an organisation. Strategic management identifies

and comprehends the environmental factors to control the plans

accordingly. It has evolved as a concept over time and will continue to

evolve.

11.2.1 Nature of international strategic management

Strategic management focuses on the process of formulating, implementing,

and evaluating strategies, to achieve the objectives of an organisation. The

concept of strategic management process in an MNC is similar to that of any

other organisation. However,amajor complicating factor is that before

considering various strategic options, the strategic management process

has to analyse and understand the environmental needs from a regional and

country perspective. Both time and effort is requiredto identify and evaluate

external trends and events in MNCs. Communication between home offices

and overseas operations become complicated because of cultural and

national differences, geographic distances and variations in business

practices. The strategy implementation becomes difficult as different

cultures have different norm values and work ethics.

Strategic management holds significance in international business. An MNC

has to keep track of their various operations in a continuously altering

international environment.

Strategic objectives

Strategic objectives assist in the implementation process of the

organisation’s objectives or goals. While implementing an international



strategy, an organisation has to identify the opportunities present in these

countries, explore the various resources available, their strengths and

capabilities and plan to work on their core competencies. The objective

should be formed in a way that it is not deficient or immeasurable. The

strategic objectives must help the organisation to achieve their mission and

vision.

Most strategic objectives focus on generatinggreater profits and returns for

the business owners; others focus on customers or society at large. The

strategic objectives(SMART) are as follows:

Specific: A clear message as to what needs to be achieved must be

provided.

Measurable: There must be at least one indicator to measure progress

against fulfilling the objective.

Appropriate: The objectives must be consistent with the given vision

and mission of the organisation.

Realistic: The objectives must be achievable given the organisation’s

abilities and opportunities in the environment. This means that the

objectives must be challenging and attainable.

Timely: To accomplish the objective there must be a time frame.

Two more aspects have been added to the objectives and it has now

become SMARTER. They are ‘Ethical’ and ‘Recorded’.

When strategic objectives are thoroughly implemented, it will result in

strategic competitiveness that improves the performance and innovation of

these organisations. The advantages of preparing strategic objectives are:

First, they guide employees of an organisation towards achieving the

common goals. This aids the organisation to concentrate and conserve

valuable resources and work together in a timely manner.

Second, challenging objectives encourage and inspire employees to

demonstrate higher levels of commitment and effort. A research has

supported the concept that individuals work harder when they are

motivated towards a specific goal, rather than being asked to simply do

their best.

Third, different parts of an organisation always have the potential to

follow their own goals rather than the overall company goals. Though

the intentions are good, they may work at cross purposes to the



organisation as a whole. Thus, meaningful objectives help resolve

divergence in such instances.

Finally, appropriate objectives offer a standard for rewards and

incentives. They not only result in higher levels of motivation for

employees but they also ensure a greater sense of equalityor fairness

when rewards are allocated.

There are other objectives that are more specific. These are commonly

referred to as short-term objectives that are essential components of action

plans. They play a critical role in implementing an organisation’s chosen

strategy.

Strategic alliances

In today’s trade, the increasing number of strategic alliances stands as one

among the fast growing developments. According to Booz-Allen and

Hamilton,strategic alliances are far-reaching through nearly every industry

and are becoming an important driver of higher growth. Alliances vary in

scope from an informal business association based on a simple contract to

a joint project agreement. To manage the alliance for legal and tax purposes

either a corporation or partnership is set up.

Strategic alliances involve organisations working together towards a

common goal for small businesses, without losing their individuality.

Forming strategic alliances helps one reap considerable profits as well as

obtain rewards of team effort. Statistical studies claim, organisations that

take part in alliances account for 18 percent of their profits that come from

their alliances.

But it is not just profit that encourages the increase in alliances. The other

factors are: a growing intensity of competition, a rising need to operate on a

global scale, a fast varying marketplace, and an industry union in many

markets. Particularly in a time when upcoming international marketing is

becoming the standard, these alliances and partnerships can influence the

growth. Instead of taking the risk and expense that international expansion

requires, any organisation can enter the international market by identifying a

suitable alliance with a business operating in the marketplace that the

organisation wants to enter.



A strategic alliance is basically a partnership in which the organisations

unite by entrusting efforts on a certainproject. The efforts exerted on the

project includegetting a better price for supplies, purchasingbulk products

and building them with each of the organisations that are a part of its

production. The goal of alliances is to reduce risk while increasing the power

and profit. Alliances should not be confused with acquisitions, mergers and

outsourcing. However,there are some similarities in the situation in which a

business may consider one of these solutions. Mergers and acquisitions are

everlasting and determine the survival of the organisation. Outsourcing is

just a way of attaining a functional service for the company.

An alliance is basically a business-to-business partnership. Another term

that is commonly used in combination with alliances is establishing a

business network. Alliances are formed for joint production, design

collaboration, joint marketing, joint sales or distribution, technology

licensing, and research and development. Relationship between a vendor

and a customer is vertical, while the relationship between vendors situated

locally or globally is horizontal. Alliances are established formally in a joint

project or partnership.

Strategic alliances are used in businesses to:

Attain advantages of scope and speed.

Boost market access.

Improve competitiveness in domestic or global markets.

Improve product development.

Increase new business opportunities through new products and

services.

Enlarge market development.

Enhance exports.

Diversify.

Make new businesses.

Minimise costs.

Strategic alliances are becoming a common tool for increasing the reach of

the organisation without exerting organisation to expensive internal

expansions beyond the core business.



11.2.2 Advantages and disadvantages of formulating strategy

The advantages of a well structured strategy in international business are:

It provides proper guidance in business.

It alerts the manager aboutnew opportunities and threats.

It aligns members to work towards common goals that are set.

It facilitates to make management become more proactive than reactive.

It helps the decision making course of assigning resources.

The problems in strategic management are:

As it is tough to predict the future, it becomes difficult to anticipate the

forthcoming environment for developing plans or strategies.

It is expensive to hire an external consultant to develop strategies.It is

prudent to address the immediate crisis before allocating resources (like

opportunity cost, people, money, time) to strategic management

process.

Sometimes few opportunities might be available in firms after

completinga strategic management process. The firm may want to

consider them which becomes difficult then.

Self Assessment Questions 1

1. The nature of ________________ plays a vital role in the international

business world.

2. The strategic objectives should be measurable, appropriate, realistic,

specific, and timely. (True/False)

3. _____________ is a way of attaining a functional service for the

company.

Activity 1

Assume that you own a company that manufacturestoys for the

international market. Your specialty lies in integrating the cultural and

religious aspects into toys. Mention in terms of strategic objectives, how

you would frameyour objectives, and what steps you would take to be

better accepted internationally.

Hint: Identify cultural differences, plan strategy to combat the same and

for alliances.



11.3 Strategic Planning

We had discussed about strategic management in the previous section. In

this section we will learn about the key components of strategic

management that is strategic planning and its types.

Strategic planning involves the structured efforts of an organisation to

effectively recognise its purposes for existing, the direction that the

organisation will pursue, and how that direction will allow the entity to

achieve its short-term and long-term goals. Strategic planning is an

important element in all kinds of organisations and is applied by

governments, non-profit agencies, individuals and businesses.

A simple approach to strategic planning is as discussed below:

1. The first step is to accurately assess where the entity is today, with

respect to its ability and resources.

2. The second step is to recognise where the organisation would like to

reachat some specificpoint of time in the future, by efficiently setting

goals and objectives that it needs to accomplish.

3. The third and final step engages choosing how to successfully progress

from the conditions of today and methodically work toward those goals

in a structured and logical manner.

During the strategic planning process, experts employ many ways, and

sometimes break down each process into a series of steps. The complexity

of the exact approach used frequently comprises of the nature of the

organisation, the kind of goals laid down and the resources needed to attain

those goals.

11.3.1 Types of planning

Strategic planning process involves allocation of resources to firms to fulfil

their long-term goals. Any business plan can be classified into three types.

They are:

Strategic planning: This planning process is the best among the three

business planning processes. It is a long-term process thatthe business

owners utilise to unveil their business’ vision and mission. It also

determines a gateway for business owners for achieving their goals.

Strategic planning fulfills the mission and the overall goals of the firm.

Whereas, the other two are rather more short-term and are used



sometimes without any relation to the long-term business goals.

However these three kinds of planning work well when used within a

strategic plan.

Intermediate planning: This planning process is for six months to two

years. They outline the manner in which the strategic plan is pursued.

Intermediate plans are often used for campaigns with the purpose and

goal of supporting the trades’ long-term goals.

Short-term planning: This planning process involves planning for few

weeks or at least for a year. It involvesdetailing out the functioning of a

strategic plan on a daily basis. Resources are allocated for business

management and development that takes place daily within the strategic

plan.

11.3.2 GAP analysis

A GAP analysis is a simple tool that helps the planning team to identify

methods to close the performance gaps. The current affairs and the required

future state must be considered by the planning team. It must be made clear

whether or not the gap can feasibly be closed by the planning team. The

performance gap is closed by modifying resources from activities to be

terminated to activities to be started. If there is uncertainty that the initial gap

cannot be closed, then the feasibility of the required future state must be

reconsidered.

Businesses implementgap analysis to accomplish company-wide goals, or

those for a specific department or area. For example, a firm that wishes to

reduce overhead costs createsa financial gap analysis. Or an organisation

that wants to enlarge its product distribution might come up witha marketing

analysis. Gap analysis help businesses measure their possible profitability

of a goal. This helps the management and staff to understand the plans laid

out in the analysis as well as stay eager about it.

11.3.3 Top-down vs. bottom-up planning

Top-down planning

Top-down planning is a common strategy that is used for project planning. It

helps maintain the decision making process at the senior level. Goals and

allowances are established at the highest level. Senior-level managers have

to be very specific when laying out expectations because the people

following the plan are not involved in the planning process. It is very



important to keep the morale of the employees high and motivate them to

perform the job.Since employees are not included in any of the decision

making processes, they are motivated only through fear or incentives.

Management must choose techniques to align projects and goals with top-

down planning. Management alone is held responsible for the plans set and

the end result. The benefit of talented employees with prior experience on

definite aspects of the project are not utilised based on the assumption that

the management can plan and perform a project better without the inputs

from these employees. Some think that the top-down planning process is

the rightway to make a plan, and that the plan development is not important.

It permits the management to segregate a project into steps, and then break

the work into smaller executable parts of the project. Simultaneously, the

work that is broken down is analysed until all the steps could be studied,

due-dates are precisely assigned, and then parts of the project are given to

employees. However, the focus is on long-term goals and the short-term

and uncertain goals can get lost. This approach is best applicable for small

projects.

Bottom-up planning

Bottom-up planning is commonly referred to as tactics. With bottom-up

planning, an organisation gives its project deeper focus because each

organisation has a huge number of employees involved, and each employee

is an expert in their own area. Team members work side-by-side and

contribute during each stage of the process. Plans are developed at the

lowest levels, and then passed on to each of the subsequent higher levels.

Finally, it then reaches the senior management for approval.

Lower-level employees take personal interest in a plan that they are

involved in planning. Employees are more encouraged which in turn

improves their morale. Project managers are responsible for the successful

completion of the project. Let us now consider the key points of top-down

and bottom-up planning.

Top-down planning

Top-down planning helps:

Determine all the goals at the initial stage of the process.

Identify the lack of ground level staff participation.

Estimate the inflexibility.



Find how management imposes the processes.

Determine the lack of motivation.

Find whether the staffs feel that their input is valued or not.

Bottom-up planning

Bottom-up planning helps:

As there are no long term vision here.

Encourage teamwork.

Estimate flexibility.

Determine whether team motivation is of high level.

Identify whether the project is team driven.

Find whether the staff feels valued or not.

Finally, a combination of these two project management methods is most

effective. Using the positive aspects of each, the organisation can align

each step so that the requirements of the project are met. An organisation

can determine the top requirements of the project and allow accountability to

get down with the lower levels. With this combination, the vision of senior

management with the skills of lower level employees is merged. This helps

in completion of the project more efficientlyusing the best employees of the

organisation.


4. A _____________ is a simple tool that helps the planning team identify

methods to close the performance gaps that has been identified.

5. Top-down planning encourages team work. (True/False)

6. ________________ are responsible for the successful completion of

the project.

Activity 2

Assume that you are the manager of an international chemical dyeing

firm that is undergoing a technological change in one of its main units.

How will you implement your strategic planning so that employees

accept and adopt change?

Hint: Use Bottom-up planning.



11.4 Strategic Management Process

In the previous section we learnt about strategic planning and its types. In

this section, we will discuss strategic management process.

Strategic management process is a way businesses build strategies that

help firms respond quickly to the new challenges. This process helps

organisations to find new and more efficient ways to do business.

The organisation should have a good strategic planning that clearly

describes objectives and evaluates both the internal and external situation

to establish the strategy, implement, evaluate, and make necessary

changes to stay as per the vision and mission of the organisation. A pictorial

representation of strategic planning process is shown in figure 10.1.

Figure 10.1: Strategic Management Process

The five levels of strategic management process are:

1. Mission and objectives: The mission defines the organisation’s

existence. The purpose of the organisation is stated by a mission

statement. The mission statement projects the organisation’s image to

customers and conveys a purpose to its employees. The goals of the

organisation are called objectives. These objectives are challenging by

nature but achievable. Objectives should be measurable so that the

company can keep a track of its progress and make modifications, if

necessary.

2. Situation analysis: After specifying the objectives, the organisation

must devise a strategic plan to attain them. New opportunities and

methods are adopted to attain the objectives when there are changes

in the external environment. Thereby, an environmental scan is

conducted to find the opportunities. To select opportunities, the

organisation has to know its own abilities and limitations. Situation

analysis includes analysis of both external and internal environment.

The external environment consists of political, social, technological and

other factors. It also analysis the functionality of the organisation. The

internal environment consists of situations like organisational structure,

market share, operational efficiency and others. Situation analysis



provides huge amounts of information. To efficiently manage this

information, the internal factors should be categorised into strengths

and weaknesses of the organisation and external factors should be

categorised into opportunities and threats.

3. Strategy formulation: After having a clear picture of the organisation,

the strategic alternatives are developed. Depending on the

organisation’s situations, different organisations adopt different

alternatives. Michael Porter’s identified generic strategies could be

applied to all organisations with includes cost leadership,

differentiation, cost focus and differentiation focus. All these can be

considered while defining strategic alternatives.

4. Implementation: The strategy is expressed in high-level conceptual

terms. The conceptual terms should be translated into detailed policies

for effective implementation and also for the understanding of the

functional level of the organisation. The functional policies should also

state practical issues clearly. The strategy must be translated into

specific policies for functional areas like marketing, production,

research and development, human resources, information system and

others. The implementation stage also involves finding the required

resources and categorising organisational changes.

5. Evaluation and control:After implementation, the outcome of the

strategy must be measured and evaluated along with the changes that

have been made. To do this, monitoring control-systems are

developed and implemented. The steps involved in evaluation and

control are to:

1. Describe the parameters to be measured.

2. Describe the target values for those parameters.

3. Carry out measurements.

4. Compare the measured results to the pre-defined standard.

5. Make necessary changes.

11.4.1 Strategy formulation

Strategy formulation is the second phase in the strategic management

process. It is the process of deciding the best course of action for

accomplishing organisational objectives and achieving organisational

purpose.. In fact, objectives and strategies are modified many timesto make



the organisation more successful. This includes creating sustainable

competitive advantages though most of them are swept out gradually by the

competitors’ efforts.

There are three aspects of strategy formulation. Each aspect has a different

focus that includes requirements to be met within the formulation stage of

strategic management. The three aspects of recommendations must be

internally steady and match together in a jointly supportive manner that

outlines an integrated hierarchy of strategy. The three aspects are:

Corporate level strategy.

Business level strategy or competitive strategy.

Functional strategy.

Corporate level strategy: This aspect of strategy is concerned with the

broad’s decisions about the total organisation's scope and direction.

Basically, the changes which should be made in the growth objective and

strategy for achieving the objective is considered, the lines of business at

present and how these lines of business go together. The three components

of corporate level strategy are:

Directional or growth strategy: This designs the organisation’s growth

objective. The objectives range from cutback through stability to altering

levels of growth and how the organisation accomplishes them.

Portfolio strategy: This strategic activity plans the organisation’s

portfolio in line with those businessess, which needs reconsidering and,

if so, how much concentration or diversification the organisation should

have.

Parenting strategy: This defines the way the organisation assigns

resources and manages abilities and activities across the portfolio,

where to emphasise, and how much the organisation should integrate

into its various lines of business.

Business level strategy orcompetitive strategy: This is also called

business level strategy. It involves deciding how the organisation would

compete within each line of business or strategic business unit.

Functional strategy: Functional strategies are more localised with shorter-

horizon activities. They deal with how each functional area and unit



performs its functional activities to be effective and increase resource

productivity.

11.4.2 Strategic implementation

Strategy implementation is one of the stages of strategic management. It

refers to decisions that are made to lay out a new strategy or reinforce

present strategies. The basic activities of strategic implementation are to

establish annual objectives, devise policies and allocate resources. In

addition, strategy implementation also include decision making with respect

to strategy and organisational structure, develop budgets and motivational

systems. The features of strategic implementation are to:

Establish annual objectives.

Devise policies.

Motivate employees.

Allocate resources.

Develop strategy-supportive culture.

Create organisational structure.

Redirect the marketing efforts.

Prepare budgets.

Develop information system.

Activity 3

A firm is in the business of detergent production which caters to the rural

and suburban areas of Uttar Pradesh. Due to the entry of international

players it is facing increasing competition from branded products.After

review meetings, the management decides to concentrate on controlling

costs. It is decided to recast/reengineer the full production and marketing

processes so as to reduce waste. The firm is also planning to to re-

negotiate with its suppliers s to minimise cost of inputs. There are certain

limittions to cost cutting as the firm cannot compromise on quality and

social issues. Suppliers of inputs are also reluctant to yield to pressures

of renegotiating the cost of raw materials. After some time, sales of the

firm has started declining very fast. What other steps can the

management of the firm plan in order to cope with the growing

competition?

Hint: Read the success story of Ghari Detergent at http://www.business-

standard.com/india/news/watch-out-for-ghari-express/413280/

http://www.business-standard.com/india/news/watch-out-for-ghari-express/413280/

http://www.business-standard.com/india/news/watch-out-for-ghari-express/413280/




7. The __________________ process is a way businesses build

strategies that help firms respond quickly to new challenges.

8. The kind of strategy concerned with broad decisions about the total

organisation's scope and direction is _____.

a) Business level strategy

b) Corporate level strategy

c) Functional strategy

d) Competitive strategy

9. One of the phases of strategic management process which includes

decision making with respect to strategy and organisational structure;

develop budgets and motivational systems is _____.

11.5 Summary

Let us summarise the points covered in this unit about international strategic

management:

International strategic management refers to planning the strategy in

international business to compete and also ensure that they have a

long-term strategy for survival.

Strategic management focuses on the process of formulating,

implementing and evaluating strategies to achieve the objectives of an

organisation.

Strategic objectives assist in the implementation process of the

organisation’s objectives or goals. Most strategic objectives focus on

producing greater profits and returns for the business owners; others

focus on customers or society at large.

Strategic alliances are the means to work together with others towards a

common goal for small businesses without losing their individuality.

Alliances are a way to obtain the rewards of team effort and one can

reap considerable profits from forming strategic alliances.

Strategy in international business has various advantages and

disadvantages.

Strategic planning involves the structured efforts of an organisation to




organisation will pursue and how that direction will allow the entity to

achieve its short-term and long-term goals.

The strategic planning process involves allocation of resources to firms

to fulfill their long-term goals. The three types of planning are strategic

planning, intermediate planning and and short term planning.

A GAP analysis is a simple tool that helps the planning team to identify

methods to close performance gaps. Gap analysis help businesses

measure their possible profitability of a goal.

Top-down planning is a common strategy that is used for project

planning. It helps maintain the decision making process at the senior

level. Goals and allowances are established at the highest level.

In bottom-up planning, an organisation gives its project deeper focus

because organisation has a huge number of employees involved and

each employee is an expert in their own area. Team members work

side-by-side and they contribute during each stage of the process.

The concept of strategic management is still evolving and will continue

to undergo changes. Thus, understanding and following the process of

strategic management in international business is helpful to practicing

managers in achieving the organisations' objectives.

11.6 Glossary

Regulatory bodies: These are professional bodies established on the basis

of legal mandate to protect the public.

Uncertainty: It is the situation where the consequences of events are

unpredictable.

MNC: Acronym for multinational company.

Strategy: Plan of action designed to achieve a specific objective.

Alliances: An agreement between two or more entities to achieve a

common goal.

Partnership: An arrangement where individuals agree to cooperate towards

a common goal.



Mergers: Combination of two or more companies, usually by offering the

stockholders of one company securities in the acquiring company for the

surrender of their stock.

Acquisitions: Corporate action in which a company buys most or all the

target company's ownership stakes to assume control of the target firm.

11.7 Terminal Questions

1. Explain strategic objectives and alliances.

2. What is strategic planning?

3. Explain top-down and bottom up planning.

4. What is Strategic management process?

5. Explain strategy formulation and implementation.

11.8 Answers


1. Strategic management.

2. True.

3. Outsourcing.


4. GAP analysis.

5. False.

6. Project managers.


7. Strategic management.

8. b) Corporate level strategy.

9. Strategy implementation.

Terminal Questions

1. In order to measure the fulfilment of the objectives, strategic objectives

need to be implemented. Strategic alliances are far-reaching through

nearly every industry. These are explained in sub-section 11.2 of this

unit. Refer the same for details.

2. Strategic planning involves the structured efforts of an organisation to


organisation will pursue and how that direction will allow the entity to



achieve its short-term and long-term goals. These are explained in sub-

section 11.3 of this unit. Refer the same for details.

3. Top-down planning is commonly referred to as strategy. Bottom-up

planning is commonly referred to as tactics. These are explained in sub-

section 11.3.3 of this unit. Refer the same for details.

4. The strategic management process is a way businesses build strategies

that help the company respond quickly to new challenges. The five

levels of management process are explained in sub-section 11.4 of this

unit. Refer the same for details.

5. Strategy formulation is the second phase in the strategic management

process. Strategy implementation is one of the stages of strategic

management. These are explained in sub-section 11.4.1 and 11.4.2 of

this unit. Refer the same for details.

11.9 Case-let

Magazine Distribution – GAP Analysis

Company PQR is the top bio-medical magazine in Pune. The vision of

Company PQR was to be the top distributor throughout India and also

expand their operation abroad. Company PQR initially completed an

analysis showing how it got to be the top regional, then top national

magazine distributor. This includes an overview of every aspect of the

business that contributes to the Company PQR's success, including

marketing, accounting, information technology, management and other

departments.

Company PQR outlined the advantages of achieving its goal of becoming

the top distributor country as well as internationally. Goals were designed

that were specific and measurable. There was a time frame set for

regional supremacy. In this case, Company PQR planned to become the

top nationwide magazine distributor within two years. They achieved their

primary goal of nationwide popularity by bringing innovative schemes that

attracted consumers to buy the same. They brought out an exclusive

section for researchers who were in the field. Company PQR then

researched as to how they would achieve international distributor and

what it requires to do to arrive at this goal. The outcome of Company

PQR's analysis was a complete plan that analysed the competitor



analysis using Porter’s model as to what they required to do so that they

can see their goal of international distribution. The aim was to achieve

international reach as they co-ordinated with scientists abroad. They

shared information on various aspects of the bio-medical field. There

were many seminars organised and eminent scientists were recognised.

At the next step, they gathered information and conducted GAP analysis

to see where they lacked. The analysis includes a review of competitors,

knowing the needs of the foreign customers, and also interviews with

staff members to know the strengths. After gathering all the information, a

gap analysis report was tabulated.

The report provided a summary of the present situation, the goals the

company wishes to achieve and the steps they had to implement to

achieve these goals. The steps were analysed into strategic planning.

This plan includes detailed action steps of the business for each area, an

agenda to complete each step and a plan that outlines how much the

plan will cost.

The next and final step was for the management to approve and support

the action plan and confirm on the budget. The plan was put into action.

Each step was tracked to assure that the plan stays as per the agenda

and within the allotted budget. The success of the Indian bio-medical

magazine in foreign shores was the talk of the town that year.

Discussion Questions

1. What did the initial analysis include? (Hint: Review of current system)

2. What does the gap analysis report include (Hint: Refer the steps,

summary, plan)

Sources: http://www.wisegeek.com/what-is-gap-analysis.htm – retrieved on 15th

November 2010

References:

K.Aswathappa (2008). International Business. Tata McGraw Hill

Publishing Company Limited.

Geoff Goldman, Cecile Nieuwenhuizen (2006). Strategy: Sustaining

Competitive Advantage in a Globalised Context. Juta and Co.

Mike W Peng (2009), Global Strategic Management, Cengage, London.



Phillippe Lesserre (2007), Global Strategic Management, Palgrave

Macmillan.

Gerardo R Ungson & Yim Yu Wang, (2008), Global Strategic

Management, Library of Congress Cataloging in Publication Data.

Abbass F Alkhafaji, (2003), Strategic Management, Formulation

Implementation in dynamic environment, Haworth Press.

E-Reference:

http://www.smallbusinessnotes.com/operating/leadership/strategi

calliances.html, retrieved on 10th November, 2010

http://www.referenceforbusiness.com/management/Sc-Str/Strategy-

Formulation.html, retrieved on 5th November, 2010

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Documents

MB0053-SLM-Unit-11