International Business Strategy IBS Essay Example | Topics and Well Written Essays - 2500 words

International Business system IBS - Essay ExampleIt is proved that using the firstly actor advantage a firm bathroom increase its competitiveness but the full success of this practice tin cannot be guaranteed, even for firms that atomic number 18 already established in their market. 2. International Business Strategy 2.1 The concept of first mover advantage - overview In the context of international business the first mover advantage theory can be cerebrate to the work of Mark rolen (2002). According to the above theorist, trade relationships are likely to be influenced by geography, meaning that businesses that are interested in entering the global market tend to prefer the markets of neighbouring countries, probably because risks and costs intricate are expected to be lower (Sitkin and Bowen 2013). For FDI overly a similar practice is used. Under these monetary value, the development of international business is based on two, critical, factors a) learning effects this te rm is used for showing the conveyance of title of association between the research and development sector of severally business and its other sectors/ de decomposements (Sitkin and Bowen 2013, p.38) this system of knowledge transfer decreases risks since no external intervention on knowledge used for building business strategy can occur b) the first mover advantage the specific concept reflects the following idea the first firm to enter a new market and leverage its existing experiences is in a slap-up position to shut out future rivals (Sitkin and Bowen 2013, p.38). According to the above, the first mover advantage involves in introducing in the market a new product or service (Cullen and Parboteeah 2013, p.273). However, the benefits of the above concept are related to the following term that the product/ service employed is not only innovative but also comprehensive (Cullen and Parboteeah 2013, p.273). The term comprehensive is used for showing a product/ service that meets the customers expectations (Cullen and Parboteeah 2013, p.273) only such(prenominal) product/ service would be able to result to profits. The concept of first mover advantage, as exposit above can be effectively used for developing a business strategy in work out not only to the international market but also to the local market (McDonald and Burton 2002). The terms of such use of the specific concept are described analytically in the next section. 2.2 The use of the concept of first mover advantage in formulating a business strategy In regard to the use of the concept of first mover advantage in practice the following fact should be highlighted the specific concept can be incorporated in different business strategies, meaning that it can be used as the basis for developing business strategies of various formats, depending on the needs of each organization, the resources available and the conditions in the business environment (Cullen and Parboteeah 2013). Figure 1 Franchising bas ed on the first mover advantage theoretical model (source Michael 2013, p.62) The study of Michael (2003) refers to the use of the first mover advantage as part of a franchising strategy. The involvement of the specific concept in a franchising strategy should be based on certain rules the relevant framework is presented