Question 1 (Essay Worth 14.28 points)

Explain in detail Porters 5 Forces model and its relevance to global planning. Student should address supplier power and how it is enhanced by the international scope of its operations. Special attention should be made about increasing market penetration and the importance of volume increases. Barriers to entry should be addressed and issues related to government policies internationally and brand identity issues. The student should discuss the power of the buyer and the leverage they may have in international markets. The student should look at the degree of rivalry and the concentration of the industry and the future growth of the industry. The student should examine the firms ability to differentiate their product from their international rivals. Is there a local firm that is a major competitor? What is the potential to and threat of substitutes when you enter a market and what is the potential for buyers to move to a substitute product?

Porter’s Five Forces model is a useful tool that can provide basic guidance concerning

planning for global expansion for and organization. The five basic principles work together to

help define the issues and concerns that impact global expansion minded company.

Supply power can greatly support an organizations operations. The availability supplies

whether they are come from within the borders of the host country or have to be imported will

dictate the success of an organization internationally. McDonalds for instance, will invest in

starting its own distribution and production lines within a new country if they can not get the raw

materials needed to ensure that they put out a quality product.

Organization seeking to expand into the global market must be aware of their strategies

for penetrating foreign marketplaces. One of the issues that could be a hindrance to an

organization ability to expand into a foreign market occurs if the market already is saturated be

like products the would pose a barrier to penetration. Another potential barrier to market

penetration could be the existence of an existing organization with in a market that has gained a

major portion of the existing market. For instance, in countries where McDonald’s restaurant has

set up shop it would be hard to open a new chain of food service entities.

When making a decision as to whether or not to expand into a particular country an

organization must take into account policies and brand identity issues that my hamper there

ability to function in the host country market place. Laws and regulations make be fashioned in

such a manner that it would make it impossible for a company survive. Tariffs, taxes, import

restriction, religion, and dietary restriction are but a few of governmental issues that must be

taken into account when considering expansion. Brand identity is another factor that can hinder

expansion. Depending on the country that you are expanding Symbols and words have different

meanings then the one you are trying to tailor your marketing strategy. A good example of this

comes from our readings is when McDonalds changed their menus in India to accommodate their

religious and cultural needs.

The power that an organization has is dependent on the availability of vendors that can

provide services or items needed. The more producers of a product that exist within the market

place, there will better opportunities for the buyer to maximize on price discounts. If there are a

limited number of producers for a product then the seller has opportunities to maximize profits

and maintain a larger share of repeat customers. These rules extend to the international market

because an organization looking to participate in the global economy should be aware of whether

they are entering a buyer’s market or a seller’s market. The optimum time to enter the market

would be during a point at when the market is advantageous to the seller.

When making the decision concern as whether or not to enter into a new marketplace an

organization should survey the existing climate in order to ascertain the level of rival and

concentration that exist and can the organization survive grow over the coming years. If there is

in existence multiple rivals and a high concentration of organizations selling products equal to on

comparable to the one that you plan to introduce into the market place, then rivalry and access to

a limited customer base will be high and chance for future growth will be limited. If there is

limited or no rivals to your organization then the opportunity for growth will be greater.

Firms should do market research in order to determine if there a large enough differences

between itself and local firms producing the same product. Some of the question to be asked:

Who are my competitors?

How large of a market share do they hold?

How are our products similar and different?

How can we maximize profits?

These are a few of the questions that can affect an organization’s participation into global

markets. How much an organization can differentiate themselves from their competition will and

assume a portion of the market.

The treat of substitution is driven by the availability of products or services that are

comparable to the other products and services being offered. The threat of substitution can impact

the price products being offered in the market place. Pricing theory states that the more like

products that are available, the lower the price that the producer can request.

In conclusion, Porter Five Forces model has illustrated some of the issues that impact

globalization. The global market place has changed a great deal since this model was written. The

internet and the change in global politics are two forces that now must be added. Is it time to

rewrite this model? I think that it is.

One of the places we can document this is by looking at the affect that Walmart Inc. had

on the market place when it first opened. They were able to offer the same or like products for a

considerably less price. This resulted in more then one store closing down or going bankrupt.

Another example is McDonalds and the impact that they have had globally in the restaurant

industry. McDonalds provides consistently high quality low cost alternatives to existing food

service providers. Both of these examples are examples of what happens when a substitution

product enters the market place. Both organizations have become dominant players in the global

economy by offer quality lost cost

Question 2 (Essay Worth 14.28 points)

Once a domestic business strategy is created, why should a business plan be created that is focused entirely on the Global Market? The student should understand the complexity of the foreign market and the huge opportunities that exist to further drive their product and brand. The international corporation must have a clear corporate objective and direction that should closely align to the corporate goals and objectives. While the execution will vary by market, the basic strategy of the firm and identity needs to be established, understood, and communicated.

A business plan aimed at the global market is needed in addition to a local business plan because there are additional factors that must included within the global business plan that are not germane to a local plan. Factors that must be considered when preparing an international business plan include:

1. Cultural, language, religious, location and the geographical make up of the country where expansion will take place.

2. Laws and regulatory policies that may help or hinder ability to enter into new market.

3. Supply chain or how the raw materials will needed to production in a foreign market be acquired.

All of these factors play a major role in the Global Market place. Frequently, we read of companies that have been unable to succeed in expanding or starting new business ventures because they did not take one of the above factors into consideration when designing their global business plan. There is never a 100 percent guaranteed chance of success, but chances are a lot greater when a well thought out and implemented business plan is in place.

Another reason that a global business plan is needed is that with the decision to move into the Global market place the business’ vision and mission statement should change to encapsulate the new direction into which the business is moving. The creation of a global business plan will help to ensure that the new entity within the organization closely aligns itself with the corporate objectives and goals. The new plan will also be a valuable tool that will help get buy in from individuals within the corporate structure and from outside stakeholders.

Question 3 (Essay Worth 14.28 points)

When writing a business plan, what are the potential audiences that you should address and how would you adapt your business plan to each of the audiences? Students should understand that there is the board of directors who will scrutinize the plan. The board must be able to understand the plan and that the plan has a high probability of success. Internal marketing, salesmen, operational people, etc, must all understand the program so there is a clear corporate direction that the organization is pursuing. The investment community must understand the plan and have confidence in management’s capability to execute the program. The plan should align with your customers' needs and wants. The plan must be able to address the different countries and cultures that the firm will be competing in and must be flexible enough to address the uniqueness of the international market. Finally, the shareholders need to know you have a clear and concise business strategy that will maximize the long term success of your corporation.

Potential audience is a major factor that should be taken into consideration whenever an organization prepares a business plan. Because of the greater number of factors that must be taken into consideration when preparing a global business plan, ensuring that target audiences is considered become even more important.

Most of the organization that I have been associated with in the past, have created several versions of a business plan with the explicit purpose of ensuring that target audience and providing the information required by each entity in order to make an intelligent and well formed decision as to the viability of a proposed business proposition. The information that an investor will review is different from the information that a board of directors will require.

One target audience can be presenting your business plan to the board of directors they will look at the plan and consider how the proposed expansion will fit into the over all goals and objectives of the organization. They will view the business plan on order to determine if future growth, return of investment meets, risks, return on investment, etc. are with in an acceptable range. They have to ensure that the shareholders and the overall financial health of the organization are protected.

Investors, Marketing, Operations, and various other entities will require other information during the presentation of the business plan. It is very important that the information needed is presented with concisely and with detail aimed at optimizing your chances of getting buy in from those that can make the project a success.

Question 4 (Essay Worth 14.28 points)

Identify the 6 Rules for Market Revitalization and how they are critical when competing in the global market. Branding is not the same as advertising. It is a promise that when you buy a product in the international market you will get and have an experience. A brand is a promise versus the actual deliverable which is a product or service. This is its international identity and its commitment to deliver on its promise. Rule 1 Refocus the organization Rule 2 Restore brand relevance Rule 3 Reinvent the brand experience Rule 4 Reinforce a results culture Rule 5 Build brand trust. Rule 6 Realize global alignments Detailing these initiatives and how they are absolutely critical in establishing a solid international plan that will be successful.

Market revitalization is a critical aspect of competing in the global market. How your company’s brand is perceived plays a large part in how customers view opportunities to interact with your business. No matter how well a brand is doing in the global market place, market revitalization and reinforcement is an ongoing process.

Brands are essential because they give potential customers a preconceived notion of what to expect whenever one sees a brand. Like for instance, if an individual in shopping for a computer and they see an Apple Store they form one of two opinions most of the time. They either view Apple brand computer as high quality dependable source for computer or view the Apple brand as being undesirable because of some preconceived notion of Apple computing products.

As stated by the Author (Light L. & Kiddon J, 2009), “McDonald’s failed to continuously improve its brand experience by ignoring these three criticalities: renovation, innovation, and marketing. McDonald’s focused on cost reduction instead of quality growth of the top line.” This is a classic example of what happens when a company looses its vision and focus. In the global market place it may more difficult to gain back lost portions of the customer base if it is lost to other competition.

Brands are a promise to the customer that you will get and have an experience. Most of the human buying trends are based on two factors. One the cost of a product and two the experience associated with the purchase of a product; however a consumer will pay more for a product or service if a greater or better experience is associated with a brand. The use of the 6 Rules for Market Revitalization can help a company to reestablish their market superiority within a given market or provide a blueprint for entering a foreign market.

Light, Larry and Kiddon, Joan, 2009. Six rules for brand revitalization, Learn how companies like McDonald's can re-energize their brands. Retrieved May 27, 2010 from http://proquestbus.safaribooksonline.com.ezproxy2.apus.edu/?uiCode=apus&xmlId=

Question 5 (Essay Worth 14.28 points)

Explain how McDonalds lost their way internationally and how they were able to reenergize their organization. Before 2003 McDonalds was driven by building the number of stores and driving sales by expanding the number of stores. On 2003 their new direction was to enhance the experience at the store level and drive sales at existing stores. They wanted to increase the number of visits to the store by the same individual. They wanted to be bigger by being better. They decide to pursue improved profitability by revitalizing the brand!

McDonalds lost their way internationally when it strayed from its core organizational objectives and goals. With a change in the marketing approach, McDonalds changed from customer service organizational plan that focused on giving its patriot an experience to a expansionist organizational plan that did not focus of the customer instead it focused on growth of the organization.

With this new business plan McDonalds began a period of low customer satisfaction and record stock drops is stock prices. Their belief that bigger is better did not prove to be a successful methodology for increasing market share. McDonalds live through years of customer apathy during this period which made it necessary for them to replace the CEO of their organization and begin the process of re-evaluating there global marketing approach and review its goals and objectives in order to determine what had happened to the brand’s standing in the global market place.

McDonalds began the process of rebuilding its dominance by hiring its previous CEO, Jim Cantalupo, to change not only turn around its sagging sales and stocks but to also change the culture of the company. Jim almost immediately started to make changes in the way that the company did business. His decision to stop projects that were not needed at that time together with his refocusing on brand identity proved to be instrumental in turning McDonalds around. Jim understood that the McDonalds Brand was the most important aspect of their identity people associated with the McDonalds dining experience. He along with his newly established CMO set about exploring and implementing the 6 Rules for Market Revitalization. The implementation of this marketing approach helped to revitalize McDonalds and reposition it as a major leader in the global market place.

The story of how a company as large as McDonalds turned its failing organization around illustrates just how important it is to ensure that organizational goal and objectives be reviewed on an on going bases. The recognition that brand presence is taken into consideration whenever customers purchase should not be overlooked because it is the face of your organization.

Question 6 (Essay worth 14.28 points)

A firm can gain a great deal of benefit by properly researching marketplaces and defining the 4 P’s from the seller’s point of view and the 4 C’s from the customer’s point of view. How would you use these tools to establish your international marketing plan?

•Product: Consumer wants and needs •Price; Cost to satisfy •Place (Distribution): Convenience to buy •Promotion: Communication

The student is required to establish their marketing mix that will satisfy their company and customer at the same time. It is extremely important that the marketing message is on target, focused and not vague. The student needs to consider the methods needed to gather information in order to make decisions. The student must understand that it will take a team effort to coordinate these functions. The student is also required to research the different needs and wants within a country.

I would utilize these tools in order to ensure that the company’s expansion into the global marketplace has been well researched and organizational stakeholders are aware of what our unified message is and we understand what we need to have in place in order to meet the needs of our new customer base.

The use of the 4 P’s should align with the customer’s 4 C’s. This will help the organization to better provided what the customer wants at a price that is satisfactory to the customer while allowing the business to make a profit. The business should have available products distribution system set up to make the product readily available to the customer. Promote clear and concise methods of communicating between customers and business partners being ever aware of the potential language and cultural barriers that may exist within the target market and within the organization.

Question 7 (Essay worth 14.28 points)

Why are operational processes so important when trying to execute your strategic global business plan?

Once a solid plan and strategy is established it really is up to the operational and technical people to establish a plan that can allow the rest of the organization to execute on their established initiatives. The operation plan must be achievable, understood and followed. Where a country may have some barriers to entry the team must establish processes to overcome the local issues. A detailed plan that addresses issues that may occur is absolutely necessary. Part of the plan is coordinating your deliverables with your sales and marketing team in order to insure the promises to the customer from the brand are achieved

The reason that the operational processes are so important to the execution of a global business plan is that operations are the individuals tasked with implementing the business plan. Operational and technical personnel are responsible for overseeing the day to day task needed to expand into a new market.

Operational and technical persons must have a clear understanding of the global business plan. They will have to believe that the plan is achievable and that they will have the support that is needed to get the job done and make adjustments if needed due to cultural and or political changes as they occur within the target market.

. The establishment of operational processes to support a global plan will help to ensure that several items occur such as deliverables are received on time, marketing strategy is being implemented properly, etc. The operational processes are the back bone of the global business plan.