15.220 Global Strategy

Here you can find a brief description of the cases that will be discussed in the course.

PART I: FRAMEWORKS FOR ANALYSIS

Reading: Thomas Friedman, “It’s a Flat World, After All”. (April 3)

“History of the world twenty years from now, and they come to the chapter "Y2K to March 2004," what will they say was the most crucial development? The attacks on the World Trade Center on 9/11 and the Iraq war? Or the convergence of technology and events that allowed India, China, and so many other countries to become part of the global supply chain for services and manufacturing, creating an explosion of wealth in the middle classes of the world's two biggest nations, giving them a huge new stake in the success of globalization? And with this "flattening" of the globe, which requires us to run faster in order to stay in place, has the world gotten too small and too fast for human beings and their political systems to adjust in a stable manner?” (source: www.thomaslfriedman.com)

Case: BA and the ‘Open Skies’ Treaty. (April 5)

Webpage: www.ba.com

A member of the royal family of European airlines, British Airways (BA) has had to relinquish its throne. Europe's #2 carrier (newly formed Air France-KLM is #1) flies from its hubs in London's Heathrow and Gatwick airports, the airline flies about 290 aircraft to more than 150 destinations in some 75 countries. It owns a minority stake (11%) in Spain's Iberia. BA and AMR's American Airlines have formed the Oneworld global marketing alliance, which also includes Cathay Pacific Airways, Finnair, Qantas, and Iberia, among others. BA has survived reduction in tourism and increased terrorist threats, but it is looking to cut more costs, including continued reduction of its workforce through 2006. (source: hoovers.com)

Case: Shimano Inc. (April 10)

Webpage: www.shimano.com

“People know the joy of contacting their hearts to the breathing of nature. People know the joy of meeting someone to communicate with each other.

That's simply because all people have nature in themselves.

And tools are largely connected with the joy of people.

We at Shimano have been providing attractive products with a focus on cycling and fishing, the most popular outdoor sports.

Wind touching the skin, sunlight streaming through the trees and wave patterns covering the water excite the hearts of people. We are aiming to become a company to create excitements among people.

We will continue to support people to realize their dreams to create new lifestyles to bring them closer to nature and share the joy of life with each other.” (source: Shimano webpage)

Case: P&G Japan: The SK-II Globalization Project. (April 12)

Webpage: www.pg.com

The Procter & Gamble Company (P&G) is a brand behemoth. The world's #1 maker of household products courts market share and billion-dollar brands. P&G's products fall into three categories: global beauty care; global health, baby, and family care; and global household care. It also makes pet food and water filters and produces soap operas (As the World Turns). More than 20 of P&G's brands are billion-dollar sellers (including Actonel, Always/Whisper, Bounty, Charmin, Crest, Downy/Lenor, Folgers, Iams, Olay, Pampers, Pantene, Pringles, Tide, and Wella). Acquisitive P&G bought Clairol in 2001 and a majority of Wella in 2003. Its purchase of Gillette in late 2005 was its biggest buy in company history. (source: Hoovers.com)

PART II: MANAGING IN DIVERSE ENVIRONMENTS

Case: Lenovo vs. Dell. (April 19)

Webpages: www.lenovo.com / www.dell.com

Heard the legend of Lenovo? Lenovo, formerly known as Legend Group Limited, is the largest PC maker in the world's most populous country. It holds its own against PC giants such as Dell and Hewlett-Packard, offering low-priced computers with Chinese character systems. Other products include servers, handheld computers, imaging equipment, and mobile phone handsets. The company also provides manufacturing and IT integration and support services. Legend Group Holdings, which is controlled by the Chinese government, owns a majority stake in Lenovo. Lenovo acquired IBM's PC operations for approximately $1.75 billion in May 2005. (source: hoovers.com)

Whether you spend most of your time in a cubicle or on a couch, chances are good that there's a Dell in front of you. The world's #1 direct-sale computer vendor provides a broad range of computer and entertainment products for the consumer and enterprise markets. In addition to a full line of desktop and notebook PCs, Dell offers network servers, workstations, storage systems, printers, handheld computers, digital music players, LCD and plasma televisions, projectors, and Ethernet switches. The company also markets third-party software and peripherals. Dell's growing services unit provides systems integration, support, and training. (source: hoovers.com)

Case: Samsung Electronics. (April 24)

Webpage: www.samsung.com

Samsung Electronics is an electronics Samson. One of the world's largest microchip makers, Samsung Electronics is also South Korea's top electronics company. It makes many kinds of consumer devices, including DVD players, big-screen televisions, and digital cameras; computers, color monitors, LCD panels, and printers; semiconductors such as DRAMs, SRAMs, and flash memory; and communications devices ranging from wireless phones to networking switches. The company, which is the flagship member of Samsung Group, also makes microwave ovens, refrigerators, air conditioners, and washing machines. (source: hoovers.com)

Case: ICICI’s Global Expansion. (April 26)

Webpage: www.icicibank.com

ICICI Bank is a commercial bank operating about 470 branches and 1,800 ATMs across India. Its commercial banking operations are divided into corporate and retail. Corporate banking provides lending and deposit services to business customers, while retail banking offers deposit accounts, loans, and credit cards to individuals. Investment banking includes treasury operations and handles the bank's investment portfolio. ICICI, which is India's #2 bank after State Bank of India, offers Internet banking services, online bill pay, and debit cards. Its life and other insurance products are offered through joint ventures with Prudential and Lombard Canada.

Case: BTC - Baku-Tbilisi-Ceyhan pipeline. (May 1)

The Baku-Tbilisi-Ceyhan pipeline (sometimes abbreviated as BTC pipeline) transports crude oil 1,760 km (1,093 miles) from the Azeri-Chirag-Guneshli oil field in the Caspian Sea to the Mediterranean Sea. It passes through Baku, the capital of Azerbaijan; Tbilisi, the capital of Georgia; and Ceyhan, a port on the south-eastern Mediterranean coast of Turkey, hence its name. It is the second longest oil pipeline in the world (the longest being the Druzhba pipeline from Russia to central Europe). (source: wikipedia.com)

Case: Arcor: Global Strategy and Local Turbulence. (May 3)

www.arcor.com.ar

Arcor's sweets, which run the gamut from lollipops to chocolate Easter eggs, are now available in 105 countries, including emerging markets such as China, the Middle East, and Russia. The company also makes candy for Wal-Mart Stores Inc. (WMT ) and Sara Lee Corp. (SLE ) "There are around 200 countries in the world, so we figure we're about halfway to where we want to be," says Arcor President Luis Pagani.

Pagani's father, it seems, was an early convert to globalization. The son of an Italian immigrant founded Arcor in 1950, and the company quickly made a name for itself in Argentina. Yet unlike many other prominent businesses in the country, Arcor never banked on its grip on the domestic market lasting forever. In 1969, it sent its first shipment of caramels to the U.S. And in 1976, it inaugurated its first foreign factory in Paraguay. Today it has six plants in Latin America in addition to 25 in Argentina. (source: businessweek.com)

PART III: LEVERAGING ACROSS LOCATIONS

Case: The Cemex Way. (May 8)

www.cemex.com

CEMEX has added some European flavor to its cement. The company, which had already climbed to the #3 spot in the cement world, acquired UK-based cement giant RMC Group in 2005. About 75% of CEMEX's sales come from cement; the company has an annual production capacity of more than 90 million tons. It also makes ready-mix concrete, aggregates, and clinker (an intermediate product used to make portland cement). CEMEX's operations are concentrated in North America and Europe, but it also operates in the Middle East, South America, and the Pacific rim. North America accounted for more than 50% of sales before the RMC acquisition, but now Europe is CEMEX's largest market. (source: hoovers.com)

Case: Zara: Fast Fashion. (May 10)

Webpage: www.zara.com

Trendy Zara is the flagship fashion brand for Europe's fastest-growing apparel retailer Industria de Diseño Textil (commonly know as Inditex). Zara, the cheap chic subsidiary of the Spanish fashion giant, runs more than 760 women's clothing stores in about 55 countries, including more than a dozen stores in the US. Zara sells women's, men's, and children's apparel and recently launched plus-size lines to clothe its larger customers. Zara Home, which sells home fashions, has about 60 stores. The Spanish fashion chain is boosting its presence in Eastern Europe, with grand openings in Hungary, Lithuania, the Czech Republic, Slovenia, and Slovakia. Zara accounts for about two-thirds of parent Inditex's sales. (source: hoovers.com)

Video: Carlos Ghosn. (May 15)

Webpages: www.nissan.com / www.renault.com

Few people have ever been the president of two very large organizations at the same time as Carlos Ghosn is nowadays. President of Nissan and Renault, Carlos Ghosn was the ‘troubleshooter charged with reviving Nissan Motor Co.’. After his success in Nissan, now its time for Mr. Ghosn to help to revive the large French automaker, which lately has been lagging behind in the world’s automotive race.