en-us https://www.intensedebate.com/users/1583352 Comments by Rami Audeh http://www.personal.psu.edu/agw2/blogs/badm523/2010/11/week-13-group-1-q3-why-this-entry-mode.html#IDComment112918822 I agree with Aleks, although most people see an acquisition to be successful if they create a benefit greater than the 2 companies by themselves, however other intangible resources such as knowledge or even tangible resources such as retaining specialized workers are hard to quantify into a number and will not show up on your profits. Tue, 30 Nov 2010 19:11:57 +0000 http://www.personal.psu.edu/agw2/blogs/badm523/2010/11/week-13-group-1-q3-why-this-entry-mode.html#IDComment112918822 http://www.personal.psu.edu/agw2/blogs/badm523/week-thirteen-acquisitions-and-alliances.html#IDComment112732803 I agree with Jeff. Going on with that, I also believe many M&A's fail due to the fact that they merge with other firms that are unrelated therefore they are unable to create synergies such as consolidation of equipment/sales-force, greater market power or access to new distribution networks. These corporations are known as conglomerates and tend to fail at a higher rate than firms that use related diversification strategies allowing them to gain synergies through acquisitions. Mon, 29 Nov 2010 21:48:50 +0000 http://www.personal.psu.edu/agw2/blogs/badm523/week-thirteen-acquisitions-and-alliances.html#IDComment112732803 http://www.personal.psu.edu/agw2/blogs/badm523/2010/11/week-13-group-1-q2-cross-border-mas-and-success.html#IDComment112698968 In order for an merger and acquisition to be successful the combined benefits from the two companies must be greater than the two companies by itself (ie. AB > A + B) Tyco International is an example of multiple successful acquisitions. They were able to acquire a wide variety of SBU’s and maintain success despite the different businesses being unrelated. Although Tyco did not have any related diversification synergies between its core businesses it was able to achieve revenue and cost synergies at the SBU level. Tyco was able to be successful by encouraging this different business to acquire companies that would allow them to consolidate manufacturing and distribution networks, establishing a common sales force for all the businesses. Mon, 29 Nov 2010 18:03:47 +0000 http://www.personal.psu.edu/agw2/blogs/badm523/2010/11/week-13-group-1-q2-cross-border-mas-and-success.html#IDComment112698968 http://www.personal.psu.edu/agw2/blogs/badm523/2010/11/week-13-group-2-q1-the-culture-of-alliances-1.html#IDComment112697001 When creating an alliance it is essential for cultures to be blended. The extent to how much blending depends on the type of alliance. However, for an alliance to be successful both companies must adapt their cultures in order to assure the employees of both companies fit in. If only one culture was used as opposed to blending the cultures, the company’s employees who have to take on the new culture will have trouble adapting and it will take much longer to build trust in the new culture, as they are unfamiliar with it. It may also make these employees feel they are of less value than employees from the other company and they will not be motivated to make the alliance successful. Mon, 29 Nov 2010 17:51:20 +0000 http://www.personal.psu.edu/agw2/blogs/badm523/2010/11/week-13-group-2-q1-the-culture-of-alliances-1.html#IDComment112697001 http://www.personal.psu.edu/agw2/blogs/badm523/2010/11/week-11-group-2-q-3-les-employees.html#IDComment108876253 LE's employees seem to be no different than competitors employees rather it appears the incentives and management techniques transform these employees into more productive workers. By not cutting workers during downturns, they were able to retain creative, hard working employees who have gone through training programs therefore increasing productivity. Also by having management polices that allows workers to meet with top management and give suggestions, most equipment was modified and ran at two to three times its original rate. These employee's value high reward incentives (which pays them according to productivity), a creative management style which makes them feel as equally important as management, and guaranteed employment which offers employees job safety regardless of how much they produce. I do not think it is hard to find people like this, however it will take time to mold these new people into the highly productive employees they have in the case. Tue, 9 Nov 2010 19:17:10 +0000 http://www.personal.psu.edu/agw2/blogs/badm523/2010/11/week-11-group-2-q-3-les-employees.html#IDComment108876253 http://www.personal.psu.edu/agw2/blogs/badm523/2010/11/week-11-group-1-q1-lincoln-electrics-performance.html#IDComment108587962 I would say employee motivation and company culture both play a major role in understanding Lincoln Electrics competitive advantage. Due to employees being highly motivated, their workers were able to increase productivity at twice the rate of competitors as well as produce at much higher levels. The culture of the company allowed everyone to feel equal regardless of the position held in the company. As mentioned, there were no reserved parking spots for senior staff and all employees ate together in the same cafeteria. Top management had an open door policy in which employees could discuss ways to improve production. Mon, 8 Nov 2010 18:23:49 +0000 http://www.personal.psu.edu/agw2/blogs/badm523/2010/11/week-11-group-1-q1-lincoln-electrics-performance.html#IDComment108587962 http://www.personal.psu.edu/agw2/blogs/badm523/2010/11/week-11-question-2-group-1-lincolns-resources-1.html#IDComment108044888 The main causes of Lincoln Electrics competitive advantage is their incentive system and their innovative management style. Analyzing their competitive advantage using a VRIN model defiantly shows that they are holding a competitive advantage. Their resources are rare and extremely valuable setting them apart from others. The resource is hard to imitate and non-substitutable, as mentioned in the case, James Lincoln shared the company’s techniques of doing business and still competitors could not maintain the same level of productivity as Lincoln Electric. Fri, 5 Nov 2010 18:54:54 +0000 http://www.personal.psu.edu/agw2/blogs/badm523/2010/11/week-11-question-2-group-1-lincolns-resources-1.html#IDComment108044888 http://www.personal.psu.edu/agw2/blogs/badm523/2010/11/week-11-group-1-q1-lincoln-electrics-performance.html#IDComment107425214 Holding the analysis to the US market, Lincoln Electric is definitely demonstrating a competitive advantage through the use of intangible resources. This competitive advantage is attributed to Lincoln Electric’s innovative management style and its incentive system. The piecework system in place motivated employees to work hard and since there was no limit on how much could be earned workers worked faster and harder then the average industry rate. Also, with guaranteed employment workers did not have to worry about getting laid off during times when orders dropped or when they overproduced. Through this incentive system workers were paid 82% greater than the city average pay for manufacturing workers. Management's "open-door" policy towards all its employees made them feel they had a say in the company and allowed them to bring suggestions straight to the executives.These management styles and incentive systems in place gave employees a sense of ownership at all levels in the organization. Through this Lincoln Electric was able to outperform competitors in the industry making it the industry leader. Tue, 2 Nov 2010 19:55:30 +0000 http://www.personal.psu.edu/agw2/blogs/badm523/2010/11/week-11-group-1-q1-lincoln-electrics-performance.html#IDComment107425214 http://www.personal.psu.edu/agw2/blogs/badm523/2010/10/week-10-question-1-group-1-scotts-model-and-national-strategy.html#IDComment107202504 Going with Jeff's point, although administrations are being changed every 4 years, the overall nation as a whole remains. The corporations and common people's strategies and goals are not going to shift much with the new administration. Also going with Aleks point, many policies put in place are long-term policies that are not easy to change. So when assessing a country and doing the proper due diligence, it is important to understand which policies and strategies that are going to be in place for the long-run in order to fully understand the country you are entering. Mon, 1 Nov 2010 17:54:20 +0000 http://www.personal.psu.edu/agw2/blogs/badm523/2010/10/week-10-question-1-group-1-scotts-model-and-national-strategy.html#IDComment107202504 http://www.personal.psu.edu/agw2/blogs/badm523/2010/10/week-10-question-2-group-1-critquing-national-analysis-models.html#IDComment107199690 I agree with Aleks that no one model should be exclusively used when assessing to enter another country. Rather, a combination of models should be used, perhaps the CLEAR model should be used as a screening tool and the remaining countries can be screened down even further using the CAGE model. This allows the company to do the proper due diligence by using multiple models that have different assessment criteria. Mon, 1 Nov 2010 17:39:12 +0000 http://www.personal.psu.edu/agw2/blogs/badm523/2010/10/week-10-question-2-group-1-critquing-national-analysis-models.html#IDComment107199690 http://www.personal.psu.edu/agw2/blogs/badm523/2010/10/week-10-question-1-group-1-scotts-model-and-national-strategy.html#IDComment106787814 As a corporation looking to enter an outside market it would be important to understand the national strategy and goals of that country. As the company is looking to be successful when entering this country they need to understand the goals of the nation and the possible changes the nation may go through. For instance, if entering a country such as Australia where they are facing water shortages and as a nation are trying to fix this problem it would not be smart to enter this market if your company will require lots of fresh water or if the byproducts of the goods your company makes will pollute water sources as this will negatively effect your business. Also if the company plans to be in the country for the long run they will have to know understand how the country is planning on changing and what they as a company will need to do to remain profitable. Fri, 29 Oct 2010 19:26:28 +0000 http://www.personal.psu.edu/agw2/blogs/badm523/2010/10/week-10-question-1-group-1-scotts-model-and-national-strategy.html#IDComment106787814 http://www.personal.psu.edu/agw2/blogs/badm523/2010/10/week-10-question-2-group-1-critquing-national-analysis-models.html#IDComment106612976 As we are learning, the greater the differences between countries, the more uncertainties and unknowns exist. A major difference we have learned between countries is culture. Culture is ultimately one of the main deciding factors a business must assess when entering another country. None of the new models learned seem to take this dimension into consideration. This is the primary reason as to why I believe the CAGE model from the Ghemawat paper to be the most useful model. The other dimensions in the CAGE model also seem to cover most of the dimensions in the other model. For instance, the economic and political dimensions are being assessed as it is in the CLEAR model as well as partially in the Institutional Gap model. Thu, 28 Oct 2010 17:55:30 +0000 http://www.personal.psu.edu/agw2/blogs/badm523/2010/10/week-10-question-2-group-1-critquing-national-analysis-models.html#IDComment106612976 http://www.personal.psu.edu/agw2/blogs/badm523/2010/10/week-9-question-1-group-1-does-nafta-work.html#IDComment106018282 It is extremely difficult to tell to what extent NAFTA is responsible for the increased growth in the economy. As there are so many factors that contribute to the growth or decline of the economy, it’s hard to pinpoint the effect of NAFTA. Studies indicate that since NAFTA, Canadian foreign direct investment has increased significantly in the US as well as Mexican foreign direct investment. U.S. foreign direct investment has also increased in both Canada and Mexico, however much greater in Mexico. NAFTA removes trade barriers between the three countries, doing this results in a larger market for all countries. Anytime a market expands there is more room for economic growth. The implementation of NAFTA has definitely been a plus but to what extent it is responsible for the economic growth is practically immeasurable. Mon, 25 Oct 2010 18:06:33 +0000 http://www.personal.psu.edu/agw2/blogs/badm523/2010/10/week-9-question-1-group-1-does-nafta-work.html#IDComment106018282 http://www.personal.psu.edu/agw2/blogs/badm523/2010/10/week-9-question-1-group-1-does-nafta-work.html#IDComment105468813 As with all trade policies, pros and cons exist on both sides, so by implementing NAFTA there is always going to be some benefits and negatives. NAFTA allows consumers to ultimately get goods cheaper and have a wider variety of goods to choose from, however in the process of doing this jobs can be lost due to corporations moving to other countries to take advantage of cheaper labor or resources. This is the chief argument against NAFTA, people mainly those in low skilled labor jobs are losing their jobs to cheaper labor sources elsewhere. Another argument posed is corporations will move into Mexico where they can take advantage of the laidback environmental laws thus polluting the earth at higher rates. Whether NAFTA has helped or not is circumstantial to the person, however, overall I see it as being beneficial since it allows for lower prices, increased efficiency, increased selection of goods, and free trade. Fri, 22 Oct 2010 18:39:53 +0000 http://www.personal.psu.edu/agw2/blogs/badm523/2010/10/week-9-question-1-group-1-does-nafta-work.html#IDComment105468813 http://www.personal.psu.edu/agw2/blogs/badm523/2010/10/week-9-question-2-group-1-the-wto-and-the-role-of-the-bric-states.html#IDComment105274598 After looking at the WTO website, the WTO negotiations have gone through a series of rounds throughout history. The latest in effect is known as the Doha round established in Doha, Qatar. The main purpose of these negotiations is to help developing nations who need the outside support in order to diminish poverty and help these countries become developed. This was done through several initiatives that discussed controversial subjects such as tariffs (and their reduction), international standards of trade, anti-dumping policies, and intellectual property protection. When negotiating the WTO gives priority to developing countries and looks to increase their participation in future negotiations. One major goal was to help reduce agricultural subsidies in developed countries to allow under-developed countries to compete in one of their main industries. This however has not been the case as the US and Europe has continued to keep agricultural subsidies in place. Another major issue that they have not seemed to thwart is the problems with intellectual property in developing countries. Thu, 21 Oct 2010 17:10:58 +0000 http://www.personal.psu.edu/agw2/blogs/badm523/2010/10/week-9-question-2-group-1-the-wto-and-the-role-of-the-bric-states.html#IDComment105274598 http://www.personal.psu.edu/agw2/blogs/badm523/2010/10/week-9-question-3-group-1-the-european-union.html#IDComment105267432 Greg makes a good point about how lots of trouble is being faced due to the fact that they are trying to unify numerous well-established and different cultures. Many countries in the EU differ greatly by language, norms, behavior, lifestyles etc. As we have learned, it takes a very long time for cultures to change thus the difficulties being faced by the EU. For these very different countries to pass a single constitution each one will have to make sacrifices that they may not be willing to do or which may take a long time before that country is willing to do so. I believe some of the countries fear the loss of national sovereignty and culture. Down the road, I see the EU continuing to grow and become more powerful, as time goes on, these countries in the EU will be able to work out their differences and will continue to slowly unify themselves. Thu, 21 Oct 2010 16:19:12 +0000 http://www.personal.psu.edu/agw2/blogs/badm523/2010/10/week-9-question-3-group-1-the-european-union.html#IDComment105267432 http://www.personal.psu.edu/agw2/blogs/badm523/2010/10/week-7-group-1-q3-does-fdi-threaten-sovereignity.html#IDComment103507593 I agree, people in the US tend to be very weary after Sept. 11th thus immediately when people hear the word Middle East or Arab they become skepticle. I think what the people need to understand here is that all the security of the ports are still being handled by the US and that all cargo is inspected by US customs and not by the company who is operating the port. Mon, 11 Oct 2010 18:07:28 +0000 http://www.personal.psu.edu/agw2/blogs/badm523/2010/10/week-7-group-1-q3-does-fdi-threaten-sovereignity.html#IDComment103507593 http://www.personal.psu.edu/agw2/blogs/badm523/2010/10/week-7-group-1-q2-us-fdi-inflows.html#IDComment103505081 The US is a large recipient of FDI for several reasons. I feel the most important reasons for being such a large recipient has to do with stable institutions that support both foreign and domestic corporations, the large economy and population of the US, and the strong education system. By having these institutions in place it makes it easier for foreign firms to enter the market and guarantees them safety as opposed to entering a country without stable institutions. The US’s size and strong economy also makes it a great target for FDI. With such highly reputable schools in the US, many international students are coming to receive higher education. Through this many foreigners are becoming familiar with the US and the great opportunities that exist here. Overall, the conditions (culture, government, institutions) make the US an ideal place for starting a business thus the high rates of FDI. Mon, 11 Oct 2010 17:54:20 +0000 http://www.personal.psu.edu/agw2/blogs/badm523/2010/10/week-7-group-1-q2-us-fdi-inflows.html#IDComment103505081 http://www.personal.psu.edu/agw2/blogs/badm523/2010/10/week-7-group-1-q3-does-fdi-threaten-sovereignity.html#IDComment102888606 I agree with Aleks that foreign operated ports should not pose a problem to national sovereignty. Although the ports are operated by DP World a UAE company, the US still owns ports and will be fully responsible for security. As the UAE is a member of America's Container Security Initiative American custom officials can inspect the shipment in foreign ports before it leaves to America further mitigating any threat to sovereignty. With the US still in full control of security with institutions like border patrol, customs and others, the fact that the port is foreign operated should not be a threat to national sovereignty. However, if a foreign company had complete control of the port and was in charge of security than I could see this as a threat to sovereignty. Thu, 7 Oct 2010 21:44:21 +0000 http://www.personal.psu.edu/agw2/blogs/badm523/2010/10/week-7-group-1-q3-does-fdi-threaten-sovereignity.html#IDComment102888606 http://www.personal.psu.edu/agw2/blogs/badm523/2010/10/eek-7-group-1-q1-us-fdi-outflows---where-does-the-money-go.html#IDComment102506179 After reading the article, I found it interesting to see that the highest rates of foreign direct investment are in developed countries. The reading stated that before FDI was mainly from developed country to developed country, however this has shifted to FDI from developed country to developing country. The fact that the largest recipients of FDI (by a large margin) are developed countries is quite shocking. The Netherlands and the UK are the biggest two recipients of FDI, this is quite interesting when comparing it to the amount of U.S. FDI in China. The U.S. has over eight times the amount of FDI in the UK than it does in China. Next to developed countries, emerging markets such as Brasil and Mexico are the next largest recipients of FDI while developing countries are very small recipients. Tue, 5 Oct 2010 17:41:40 +0000 http://www.personal.psu.edu/agw2/blogs/badm523/2010/10/eek-7-group-1-q1-us-fdi-outflows---where-does-the-money-go.html#IDComment102506179