Question 1

Consider why a firm should enter a market via a wholly owned subsidiary. What are the advantages and disadvantages of this type of strategy?

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Question 2

What are first-mover advantages? Discuss the advantages associated with them.

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Question 3

What is intangible property? How can intangible property be protected in a licensing agreement?

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Question 4

Define licensing agreements. What are the advantages of this mode of international expansion?

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Question 5

Which of the following statements is true of strategic alliances?

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The disadvantage of a strategic alliance is that the firm risks giving away technological know-how and market access to its alliance partner.

Question 6

Managing an alliance successfully requires building interpersonal relationships between the firms' managers. This is sometimes referred to as ____.

Accepted Answer

Building interpersonal relationships between the firms' managers is referred to as relational capital. Relational assets refer to non-human resources such as technology and intellectual property. Operational assets refer to tangible assets such as machinery and equipment. Venture capital refers to funds provided by investors to start-up companies or small businesses with perceived long-term growth potential.

Question 7

What is a joint venture? What type of joint venture is most common? Provide an example of a joint venture.

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Question 8

Why should a firm be cautious about entering a licensing agreement?

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Question 9

Why should a firm choose exporting as a means of foreign market expansion? Discuss the advantages and disadvantages of exporting.

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Question 10

Explain the idea of a turnkey project. Why should a firm use this arrangement to expand internationally? In what industries are turnkey arrangements most common?

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Question 11

Discuss the advantages of using a joint venture to enter foreign markets.

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Question 12

Draw a distinction between firms based on their core competency.

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Question 13

Discuss Bartlett and Ghoshal's perspective on how firms from developing countries should approach international expansion.

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Question 14

What are the two methods of entering foreign marketing using a wholly owned subsidiary?

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Question 15

Imagine that you are meeting with your superiors to discuss entering a foreign market. Your boss has asked you to analyze a joint venture prospect. Why might you tell your boss that the joint venture is not a good idea?

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Question 16

Discuss the trade-offs associated with large-scale entry versus small-scale entry.

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Question 17

How can a firm protect its proprietary information in a joint venture arrangement?

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Question 18

Compare and contrast licensing agreements and franchising agreements.

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Question 19

Briefly explain the advantages and disadvantages of franchising agreements.

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Question 20

Explain the relationship between first-mover disadvantages and pioneering costs.

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Quiz 15: Entry Strategy and Strategic Alliances