Assessing Performance

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Assessing PerformanceCourse Review
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Session Outline

• Assessing Performance
• Economic measures
• Non-Economic measures
• Subjective/generic measures
• Critical determinants of performance
• Course review
• Practice Exam Case Proctor Gamble Italy
• Exam Details
• Celebrate at the Irish Pub!!!

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Economic Measures

• Most common measures include

Katsikeas, Leonidou Morgan (2000)
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Economic Measures

• Sales ratio/intensity
• Firms foreign sales as a percentage of total
  sales
• Overall, the most common measure of international
  performance used in marketing and strategy
• Reflects the importance of and/or success of a
  firms international operations in terms of its
  overall operations
• Criticisms

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Non-Economic Measures

• Most common measures include

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Non-Economic Measures

• Number of foreign markets
• Used as an indicator of success in reaching the
  international community
• Based on the assumption that
• If a firm is successful in its international
  expansion, it continues to expand
• If unsuccessful, the firm will often take a
  defensive position and retreat to the security of
  the domestic market
• Criticisms

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Subjective/Generic Measures

• Most common measures include

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Subjective/Generic Measures

• Overall satisfaction with international
  performance
• Management alone knows what its goals and
  expectations are regarding international
  performance
• Therefore, management is in the best position to
  judge whether or not the firm is achieving its
  goals
• Measure is consistent with the trend of managing
  by objectives

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Key Determinants of Performance

• Environmental factors
• Differences can actually have a positive effect
  on performance
• Particularly economic and cultural differences
• Organisational factors
• Resources availability and commitment
• Particularly physical and human resources
• Capabilities/competitive advantages
• Can insulate the firm from direct competition and
  therefore, positively effect performance
• International experience
• Direct correlation between increasing experience
  and superior performance

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Key Determinants of Performance

• Management factors
• International experience
• The more international experience managers
  acquire, the better international operations
  performed
• Attributed to superior understanding of markets
• More appropriate and effective strategy decisions
• Global orientation
• Top performing international firms have tended to
  have managers with regiocentric and geocentric
  orientations
• Managers typically seek to create global/regional
  strategies, which
• Achieve economies of scale
• Develop a consistent brand image

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Key Determinants of Performance

• Motives and Barriers
• No significant difference between firms
  internationalising for proactive or reactive
  reasons
• Dependent on the industry and firm
• Initiation barriers (organisational factors) tend
  to have the most direct effect on performance
• Particularly resource issues
• Internationalisation
• No significant difference between incremental and
  born global firms
• Once again, dependent on the industry and firm

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Key Determinants of Performance

• Entry strategy
• Medium/high cost and control entry strategies
  have tended to be more successful
• Attributed to
• Greater investment
• More research and planning
• More control
• Greater commitment

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Key Determinants of Performance
What is driving the changes in this
strategy-performance relationship?

• Marketing strategy

Standardisation (1960s 1980s)
Adaptation (1980s 2000)
Standardisation (2000 ????)
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Course Review
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Course Review
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Class 1

• Motives
• Reactive and Proactive
• Barriers
• Initiation of foreign expansion
• Process of foreign expansion

• Wal-Mart
• Impact of motives and barriers on success
• Interaction between environmental, organisational
  and management factors

• Uppsala model - incremental expansion
• Dimensions approach internationalise along
  various dimensions
• Born Global management, size, age, industry,
  value-added products

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Class 2

• Resources and Capabilities
• Tangible and Intangible assets
• Capabilities
• ? Competitive Advantage
• International experience
• Reduced uncertainty
• Greater understanding

• P G Japan
• Influence of management characteristics and
  organisational change on international expansion
  and marketing strategy

• Personal characteristics
• i.e. age, education, personality etc
• Global orientation
• Ethnocentric
• Polycentric
• Regiocentric
• Geocentric

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Class 3 Culture Business Practices

• National Culture
• Hofstede
• Power Distance
• Uncertainty Avoidance
• Individualism-Collectivism
• Masculinity-Femininity
• Cultural Distance
• Uncertainty and perception of risk
• Differences as a basis for differentiation
• Discretionary adaptation

• NES China
• Business ethics
• Balancing the need to adapt to practices in the
  foreign market with standards and guidelines
  enforced in the home market

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Class 4 Legal and Political Factors

• Home legal/political factors
• Facilitators of foreign expansion
• Inter-state political factors
• Geo-political rebalancing
• State legal/political factors
• Assessment of political risk
• Strategies to lessen political risk

• Chiquita bananas
• Influence of changes in the legal and political
  environment on
• Foreign market opportunities
• Strategies for growth
• Need to develop a portfolio of products and
  markets to insulate the firm from changes in one
  market
• Expect the unexpected

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Class 5 Technological Economic Factors

• Advances in technology
• New markets
• New channels of communication
• Entrepreneurial approach
• Global sourcing

• Weight Watchers Mexico
• Influence of economic instability on market
  attractiveness and strategy options

• Economic Factors
• Challenges of marketing in less developed
  countries
• Nestle infant formula controversy
• Societal marketing
• Economic crises
• Unilever Indonesia
• Luis Vuitton Japan

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Class 6

• Entry Decisions
• Which foreign market?
• Scale?
• Timing?
• Strategy
• Classification
• Cost and control
• Determinants
• Environmental factors
• Organisational factors
• Management factors

• Guest Speaker Andrew McLoughney
• Market selection (potential, sophistication and
  competition)
• Fit with organisation and management resources
  and capabilities
• Influence of environment and resources on entry
  strategy

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Class 7 Product Global Brands

• Stella Artois
• Pros and cons of developing a global brand
• Impact of environmental, organisational and
  management factors on this decision

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Class 8 Marketing Communication

• Marketing Communication Process
• Effective international marketing communication
• Target audience
• Communication objectives
• Message design
• Media
• Message source
• Feedback
• Ability/desirability of standardisation and
  adaptation

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Class 9 Pricing Distribution

• Pricing
• Environmental and organisational factors
• Currency fluctuations
• Grey market/parallel imports
• Pricing policies
• Polycentric/Regiocentric
• Ethnocentric
• Geocentric

• Distribution - Loctite
• Need for local sales force in early stages of
  market penetration
• Migration toward direct distribution driven by
• sales plateau
• need for global account management to service
  multinationals
• need to grow the business into a more complex
  portfolio of products and market segments
• greater need for product knowledge
• different set of management skills to enter new
  segments
• need for flexibility and speed

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Class 10 Services Retail

• Services Marketing Mix
• Traditional view that it is difficult to
  standardise services due to variability and
  inseparability
• While adaptation is sometimes desirable, can
  standardise many aspects
• Most difficult element to standardise is people
• Typology of International Services
• Location-free professional services
• Location-bound customised projects
• Standardised service packages
• Value-added customised projects

• Retail Mix
• Merchandise - produce a large core merchandise
  range, which allows variations across markets
• Trading format - heavily influenced by regulation
  and availability of sites
• Customer service - difficult to standardise and
  attempts to do so have met with customer/staff
  resistance
• Communication - sales promotions tend to vary
  the most across markets

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Class 10 Services Retail

• Guest Speaker - Dr Kerrie Bridson - Global
  Retail Trends
• The Changing Retail Landscape
• A Focus on Fun and Entertainment (Krispy Kreme)
• A Focus on Being a Specialist (Camper)
• Increasing Specialisation (Sephora)
• Focus on Branding with International Presence
  (Zara)
• Manufacturers Focus on Moving Forward as Retail
  Brands (Nike)
• Non Traditional Players Moving Forward as
  Retailers (Land Rover)
• Experiencing the Brand (Apple)
• Global High Street (Gap)
• Focus on Making It Easier (Scarpe Italiane
  (Italy))
• Focus on Adding Reasons to Shop and Stay Longer
  (Xanadu)

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Practice Exam Question

• Proctor Gamble Italy
• Procter Gamble is faced with a number of
  options relating to the product launch of
  Pringles in Italy. Which aspects of the
  traditional launch strategy would you implement
  in Italy and which would you adapt? Justify your
  decisions using information from the case and
  concepts from the course.
• In small groups discuss your answer outlines and
• Develop an outline that you think best answers
  the question

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Exam Details

• Date Friday 3rd December
• Time 9.00am
• Location Mawby
• 15 minutes reading time
• 2 hour exam
• Pre-released case study
• Open book, open note

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Exam Structure

• Two compulsory question based on a pre-released
  case
• Question 1 (40 marks)
• Focus on strategy
• Evaluation and recommendation
• Question 2 (60 marks)
• Implications for marketing strategies

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Exam Tips

• Be aware of the weighting allocate time
  accordingly
• Question 1 (approximately 45 minutes)
• Question 2 (approximately 70 minutes)
• Read the question carefully answer the
  question!
• Use a point-form plan (write on inside page of
  booklet)
• Make it easy for the examiner to give you marks
• Core idea, then elaboration
• Short, legible sentences
• Clear logical structure
• Support your points and ideas (theory, research,
  examples)
• Give relevant examples from cases, experience,
  readings, class discussion

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Course Overview
Organisational Performance
Marketing Strategy
RESEARCH PLANNING
PROCESS
STRATEGY
MEASUREMENT OUTCOMES