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INTERNATIONALISATION FOR GROWTHModule Presentation

[Place], [Date]

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TRAINING OBJECTIVES AND CONTENTS

The SPIN-UP training in Internationalisation for Growth will help University Spin-Off’s managers to managers to improve the abilities needed to plan and act in a particular business growth strategy, namely oriented to foreign production, networks and markets, etc.

Know the basics about business

internationalization

Identify needs for internationalization and

develop a strategy

Decide on the best options and practice

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TRAINING OBJECTIVES AND CONTENTS

Recognize the importance of internationalization

Understand drivers and types of internationalization

Understand models, entry modes and integration

Understand barriers to internationalization

Know the basics about business internationalization

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TRAINING OBJECTIVES AND CONTENTS

Internationalization as a strategic option

Incorporating internationalization in the strategy formulation process

Internationalization and the Internet

Identify needs for internationalization and develop a strategy

Decide on the best time (‘readiness’)

Decide on options in the Internationalization Plan (exports and outsourcing)

Search for the best support.

Decide on the best options and practice

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TRAINING OBJECTIVES AND CONTENTS

Knowing the basics of internationalization

Identifying future needs and developing the strategy

Deciding on the options

Learning Objectives Learning Contents

Know the basics about business

internationalization

Identify needs for internationalization

and develop a strategy

Decide on the best options and practice

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WHAT INTERNATIONALIZATION IS

Extending business operations abroad ‘Sophisticated’ definition: Innovative, pro-active and risk-seeking

behavior that crosses national borders with the intention to create value

It encompasses: export, import, outsourcing/subcontracting, knowledge exchange, etc.

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Push factors:

- Limited home market- Fierce competition in home market- Skills that can be easily used abroad (without substantial extra costs)- Government export subsidies and support- Strong regulation in home market

PUSH-PULL FACTORS APPROACH (1)

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Pull factors (active attraction reasons)

- Globalization and increasing liberalization of international markets (EU), advances in ICT and transport

- Attractive foreign resources (cheap labor and raw material)- Attractive foreign partners (suppliers; large firms providing finance and market

access)

PUSH-PULL FACTORS APPROACH (2)

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1. Stepwise model: the firm goes abroad if a well-established position gained in the domestic market (however, danger of competition capturing markets abroad)

2. ‘Born globals’: the firm goes abroad already during or immediately after establishment (based on existing research networks abroad, early international fair networks, etc.). Main driver: too small domestic market (niche) and a large investment size.

MODELS OF INTERNATIONALIZATION

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• Size of demand and of future demand (trends) (export)• Specific customer specifications and taste, including the need to adapt the

product (export)• Price differences, quality level, logistics (export, outsourcing/ import)• Distance with the country/region abroad e.g. physical and cultural (export,

outsourcing; import)• Differences in legal/regulatory circumstances, e.g. IP, risks in payment, etc.

(export, outsourcing, manufacturing on-site)• Contact persons, networks to access the country (all activity)• Labor: staff recruitment (export, manufacturing on-site)

MARKET/COUNTRY CHOICE

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Indirect: without presence of the firm (works via representative/ agent)

Cheap but less control!

Direct: with presence of the firm in the foreign country (office/manufacturing plant)

More expensive, but also more control over activities and better knowledge of local market demand

ENTRY MODES

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• Gaining access to networks and contacts in foreign markets • Navigating in unfamiliar business environments, e.g. due to language, (business)

culture• Procedural barriers (standards, legal and regulatory framework)• Missing the capability to understand the competition and to assess potential

opportunities and risks abroad• Short in confidence, management time and other resources to investigate and

pursue opportunities in networks and markets abroad

FIVE TYPES OF BARRIERS (UK 2010)

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• Readiness includes specific conditions for take-off of internationalization set in place in the firm:

• A product/service that is in demand abroad• Significant management time and commitment across the firm• Stepwise model: solid position in the domestic market (confidence, working

capital)• Sufficient resources to succeed: travelling costs, product modification,

international marketing staff, etc.• A solid Export Plan (strategy)• Export knowledge and skills (e.g. country profile, export documentation)• Access to trade networks arranged in the host country (e.g. distribution)• Benefits from support (e.g. export credit insurance)

READINESS TO INTERNATIONALIZATION

URL . www.spin-up.eueMail . info@spin-up.eu