International Strategic Management

INTERNATIONAL STRATEGIC MANAGEMENT

Name Akashdeep singh

Professor name : Adrian monaghan
Student id :@00615558
International Strategic Management

Table of Content

1. Porter’s Five Forces Model………………………………………………….. 3

i. Competitive Rivalries………………………………………………….. 3

ii. Threats of New Entrants ............................................................................ 3

iii. Bargaining Power of Suppliers .................................................................... 4

iv. Bargaining Power of Customers ................................................................. 4

v. Threats of Substitute Products and Services ............................................... 5

2. Value Chain Model................................................................................................ 5

i. Inbound Logistics …………………………………………………..

ii. Operation …………………………………………………..………….. 6

iii. Outbound Logistics ………………………………………………….. 6

iv. Marketing and Sales ………………………………………………….. 7

v. Services …………………………………………………..………….. 7

vi. Support services ………………………………………………….. 9

3. Modes of Entry ……………………………………………………………….. 10

i. Licensing and Franchising ......................................................................... 10

International Strategic Management

ii. Partnership and strategic alliance .............................................................. 11

4. Creating Shared Value ........................................................................................... 12

5. References............................................................................................................. 12

6. Appendixes …………………………………………………………………………….12

International Strategic Management

Porter’s Five Forces Model

Many cities in wealthy nations are experiencing changes in their urban mobility, and these shifts are not
tied to the continuance of linear trends like increased motorization witnessed in the later part of the
twentieth century. Porter's Five Factors model is useful for examining five competitive forces that define
an industry, as well as determining potential strengths and weaknesses. Porter's five forces may be used to
assess the provision of mobility in London's competitive environment.

Competitive Rivalries

The force is used to figure out how many rivals are in the industry. The mobility services business in
London has a somewhat high barrier to entry for new entrants. Some companies provide private mobility
services, and they're breaking up the usual playbook by disrupting London's mobility services with
internet-styled digital transportation. There are firms like Uber and bicycle-sharing companies like Mobike,
for example. In London, the mobility services business is more likely to achieve more collaboration and
integration. The London transit protocol provides a common platform for various transportation providers.
Commuters may quickly browse, book, and pay for their trips using a user-friendly interface (Walder,
2017). As a result, rather than facing direct competition from other kinds of mobility service providers, the
future of this business in London will witness greater collaboration and cooperation.

Threats of New Entrants

New entrants into the market have an impact on the competitive situation because they might drive
current transport firms to keep prices low or maintain pricing. In London, the mobility business
necessitates the attainment of certain economies of scale. Without this, the firm may not be able to
survive in this competitive atmosphere. Because of the digital mobility that exists in London, a significant
amount of money must be spent on brand development and raising client knowledge of the new methods
that the brand mobility service operates and how they intend to assist consumers. Furthermore, there are
substantial obstacles in the United Kingdom when it comes to navigating the policies that have been
created by the local government. In London, there are a number of large-scale organisations that offer
navigation mobility services.
International Strategic Management

Bargaining Power of Suppliers

Companies in London's mobility service business buy a variety of inputs, such as infrastructure and
equipment, and they all target the same clients. They also provide almost identical items with no
distinction. The option to replace and adjust the cost is limited, and the mobility client is unlikely to retain
clients, putting downward pressure on costs. As a result, supply has little negotiating leverage in London.

Bargaining Power of Customers

Powerful clients in many sectors may use their strength to force price reductions and demand additional
services at reduced pricing. The quantity of consumers or buyers accessible to the organisation, the
importance of each client, and the amount of money it takes to recruit new customers all influence this.
Customers are at the core of enterprises all around the globe, and the transportation sector is no
exception. Instead of using conventional mass transportation to provide mobility services, there is a
change in the mobility services in London. Commuters will be able to mix and match mobility services that
are necessary to go from one location to another in this way. As a result, consumers are in charge in
London, and they have the ability to tailor their travels, including selecting service providers and modes of
transportation. As a result, clients' negotiating power in this business ranges from modest to high.

Threats of Substitute Products and Services

If replacement services and items can be employed instead of mobility services, profitability would suffer.
The supply of mobility services in London is unique, and the city cannot function without it in order for
residents to travel from one location to another inside the city. As a result, commuters do not have many
options or alternatives to what is now available in the urban core. As a result, the risk of London having
replacement mobility services is minimal. The mobility sector evolves over time and is not static; as time
passes, new opportunities emerge.

Model of the Value Chain The value chain is made up of many marketing, design, and distribution
operations (Lee & Han, 2009). The competitive advantage is derived from various discrete operations that
a business designs when it comes to creating, promoting, manufacturing, supporting, and providing
services, and it cannot be comprehended only by looking at the companies as a whole. SEAT Minimo is a
low-cost mobility profession that provides transportation at a cheap rate (Estampe, 2014). This
organization's business process includes certain operations that provide value to its services, and these
activities make up the value chain model. The value chain model gives you a competitive edge over your
rivals and guarantees that replacement risks are minimised. Their activities may be split into two
categories: main and secondary activities. The main activities are in keeping with the company's key aims,
which is to achieve operational effectiveness, and this is accomplished; thus, the primary activities are
Minimo's focus. The key operations are linked to the selling, maintenance, physical creation, and service
support. The major activities are as follows:

Inbound Logistics

Pricing: When compared to aircraft, the minimum cost of high-speed mobility services is quite inexpensive.
International Strategic Management

Minimo is an all-electric quadricycle with a 15 kWh battery and a claimed range of 100 kilometres.
Minimo's battery is constructed with a removable battery pack that can be switched out for charging
(Martorell, 2019). It is reasonably inexpensive, and it is fuel-efficient for the sake of the environment as
well as cost-cutting by lowering the weight of the seats. To minimise weight and move on electric wheels,
the system uses Nono technology painting.

Operations

Ticket Counter: Customers will find ticket counters at all of the locations where Minim operates, saving
time. Safety Service: Minim has been praised for providing a better degree of personnel management that
ensures the passengers' safety, since safety comes first for travellers (Harrington, 2015). Minim always
makes sure that passengers arrive at the appropriate spot at the right time.

Outbound Logistics

Minim provides a luggage method for light travellers, such as compact bags and other languages that may
be stored beneath the seat.

Marketing and Sales

Minim website promotion is done via search engines and on their own website. The key selling point is the
affordability and speed; despite the fact that substantial baggage cannot be carried, the costs are
inexpensive when compared to jets (Salens, 2019). Minim also provides a seasonal discount, which aids in
the promotion and marketing of the company to passengers during peak season.

Minim's advertising is bold; it also employs dynamic and vivid colours, as well as beautiful painted on the
SEAT Minim.
Electronic Tickets: The company offers online tickets and is required to keep customer information secure.
The information is transferred to the client's mobile phone.

Service:

i. Reliability

ii. Aiming for customer happiness iii. Providing two seats for a trip

iv. There will be no pre-assigned seating; instead, first-come, first-served will be served.

v. Payments via credit card

vi. City inhabitants, intra-city travellers, and businesspeople are the target audiences.

Support Activities
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They are used to support the principal operations in order to help organisations and people in the London
mobility sector get a competitive edge over their competitors.

SEAT Minim has a great name and brand recognition in Italy, and this is expanding to other places such as
London, allowing the company to spread its services to these nations. It aids in the enhancement of their
brand's reputation. The model is also built on a low cost, which results in cost effectiveness. The potential
drawback in London is that clients may believe that cheap pricing equates to inferior quality.

SEAT Minim mostly hires young employees, who are required to dress casually in order to promote the
company's corporate culture. Job applications are submitted online. It also promotes diversity, allowing
the workforce to be the driving force behind success. Technology: SEAT Minim employs cutting-edge
technology and maintains a consistent IT business strategy in order to provide high-quality services. In
order to make it simpler for clients to access their services and routes, the corporation has also introduced
mobile applications.

SEAT Minim works with external information technology businesses like Microsoft to guarantee that the IT
component of the company is well-maintained via CRM, client databases, online reservations, and
emailing (Salens, 2019). The firm has developed an innovative approach for measuring the performance of
its suppliers.

Table 1: value chain model

Modes of Entry

The SEAT 'Minim' may reach London through a variety of routes. The method of entrance to be
examined is determined by the benefits that the approach offers as well as the financial aspects that
will decide how smoothly the company runs (Elsner, 2014). The company might choose from a
variety of approaches to enter the new market. When it comes to entering a new market, there are
approaches with high risks and methods with minimal risks.
International Strategic Management

Licensing and Franchising

SEAT ‘Minim' may leverage the license arrangement with the mobility firm in London to enter the market.
The license technique enables speedy entry into the London market while assuming minimal legal and
financial risks. A license strategy that permits foreign enterprises to sell their services or goods to a
producer is known as international licensing (Welch, 2015). In the same way, it permits the use of
intellectual property rights such as copyright, trademarks, and patents in return for royalties. Because it
utilizes the licensor's IP, licensing will allow SEAT "Minim" to operate in London, United Kingdom
(Plemmons, 2018).

As a result, the licensee will be obliged to pay a charge in return for the right to utilize the services
provided by SEAT 'Minim.' Because the licensor will only put in a little amount of money, it has the
potential to provide a huge profit, making it a viable approach for SEAT 'Minim' to exploit (Bridgman,
2016). However, the corporation should be aware that, since it would be the licensee's responsibility to
sell the services and goods delivered in London, potential marketing returns may be lost. As a result, this
mode of admission lowers the cost and potential hazards.

Franchising is the process of selling a business in the form of a contractual partnership. The seller is known
as the franchisor, and the firm in partnership is known as the franchisee (Baena, 2012). SEAT 'Minim' may
also elect to sell franchises, in this case the franchiser grants a foreign firm the right to use the brand's
name and offers mobility services to the London-based company. In this situation, the franchisee will be
responsible for operations and must agree to operate in accordance with the business model established
by the franchiser, SEAT 'Minim.' The franchisee is responsible for providing new product support, training,
and advertising in this situation. While a result, franchising becomes a natural means of firm growth as it
continues to function domestically according to the franchise model. In exchange for the franchisor's
services, the firm must make a lump sum payment and share future profits in the form of royalty
payments (Bagchi, S., & Sivadasan, 2017). Even though the franchisor benefits more from collaboration
than the franchisee, the success of such operations is reliant on each other under the franchising
approach.

Strategic Alliances and Partnerships

Another strategy that SEAT ‘Minim' may utilise is to form a strategic relationship with another mobility
firm in London. Contractual agreements between the enterprisers are required for the strategic
partnership. According to such an agreement, the parties concerned are likely to work in a certain way in
order to attain the shared goal (Ahsan & Musteen, 2011). To establish if such partnerships are viable for a
SEAT 'Minim,' it must assess the value that the partner may offer to the endeavour, taking into account
both intangible and concrete factors (Ang, Benischke, & Doh, 2014). SEAT 'Minim' is anticipated to gain an
edge as a consequence of a relationship with a local mobility provider in London.

that local enterprises have a greater grasp of the local mobility market and culture, and hence can conduct
business better than imposing international corporations.
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SEAT 'Minim' may also leverage joint ventures and strategic partnerships, which will enable the firm to
share risks as well as the necessary resources to penetrate the London market (Almor, 2018). Even though
resources must be shared, it will provide the firm with a level of flexibility that would not be possible if
SEAT ‘Minim' went via the direct investment entrance approach on its own. Consider this entrance route
because it provides for simple compliance with government rules and shared product development (Gayle
& Xie, 2018). There is also technology sharing, reward sharing, and risk sharing in this entrance technique.
SEAT 'Minim' may also profit from joint ventures and strategic alliances since local enterprises may have
political ties, and the ease of operation may be dependent on such partnerships.

Creating Value for Everyone (CSV)

SEAT ‘Minim' is one of the few firms that has considered producing shared value in the majority of its
operations and industry design. The organization has guaranteed that corporate social responsibility and
competitive benefits are linked. As a result, when this organization works as a corporate entity, it has been
able to increase its profitability while simultaneously increasing environmental performance, public health,
financial security, and other essential aspects of society's well-being (Kim, 2018). To guarantee that the
firm creates shared value, the corporation has explored how it may benefit community health by reducing
air pollution. First and foremost, SEAT 'Minim' is one of the businesses that provides mobility services and
has included environmental considerations into its services (Martorell, 2018). SEAT 'Minim' has pledged to
conserve the environment by using recycled materials.

providing sustainable transportation and serving as a role model in environmental protection The
organization is committed to reducing its environmental impact and using its own capabilities as a means
of tackling environmental concerns throughout the life cycle of the mobility services it provides. The
business provided low-pollution transportation services, and selecting SEAT ‘Minim' implies lowering
dangerous air pollution caused by exhaust emissions (Martorell, 2018). The SEAT ‘Minim' emits no
pollutants into the atmosphere. It also makes use of renewable energy, lowering greenhouse gas
emissions even further (Martorell, 2020). The organization's products are environmentally beneficial since
they can be recycled, and the cushioning is made of bio-based components.

The firm is also concerned about the health of its customers and the wider public, and lowering dangerous
exhaust emissions improves air quality, resulting in lower costs and health concerns associated with air
pollution (Liel von, 2016). When compared to gasoline-powered buses and vehicles, the SEAT 'Minim' is
also quieter, implying less noise pollution.

The public's and passengers' safety is also taken into account when creating shared value, and in this
instance, they have a lower center of gravity, which minimizes the likelihood of rolling over. Furthermore,
they provide a lesser danger of severe explosions and fires, and they are even safe in the event of any kind
of catastrophe, such as a collision (Liel von, 2016). As a result, it addresses the community's health by
providing the safest modes of transportation. Furthermore, since the SEAT 'Minim' is a two-seat mobility
device, it decreases the number of persons who may be victims at the same time in the event of an
accident (Seat, 2018). Furthermore, since the number of passengers on board at any one moment is
restricted, it may efficiently be utilized to reduce the risk of spreading infectious illnesses such as the new
coronavirus.
International Strategic Management

References

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uncertainty: A review and extension. International Journal of Management

Reviews, 13(4), 376-392.

Almor, T. (2018). Towards a contingency view of market entry strategies: Contextual and

strategic factors. Foreign Direct Investment and Strategic Alliances in Europe, 2(1), 5-25.

Ang, S. H., Benischke, M. H., & Doh, J. P. (2014). The interactions of institutions on foreign

market entry mode. Strategic Management Journal, 36(10), 1536-1553.

Baena, V. (2012). Master franchising as foreign entry mode: Evidences from the Spanish

franchise system. ISRN Economics, 2012(3), 1-8.

Bagchi, S., & Sivadasan, J. (2017). Barriers to entry and competitive behavior: Evidence from

reforms of cable franchising regulations. The Journal of Industrial Economics, 65(3),

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Bridgman, B. (2016). Market entry mode: Evidence from the golden age of

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Elsner, S. (2014). Study 1 – Effects of institutionalized entry modes on entry mode

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Estampe, D. (2014). Performance evaluation model for value creation. Supply Chain

Performance and Evaluation Models, 1(1), 87-103.

Gayle, P. G., & Xie, X. (2018). Entry deterrence and strategic alliances. Economic

Inquiry, 56(3), 1898-1924.

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Harrington, L. (2015). Supplier logistics in the driver's seat.

https://www.inboundlogistics.com/cms/article/supplier-logistics-in-the-drivers-seat/.

Retrieved July 15, 2020, from https://www.inboundlogistics.com/cms/article/supplier-

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Kim, K. (2018). A case study to explore applicability of creating shared value (CSV) into design

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Lee, M., & Han, M. (2009). Knowledge value chain model implemented for supply chain

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Appendixes

Porter’s Five Forces Model

Diagram 1: Porter’s Five Forces Model

Diagram 2: SEAT Minimo

 International Strategic Management – Assignment 1
Task 1 – Table Templates
Political Factors – National Level
Factor Data Source Weighting United Kingdom United Kingdom Australia Australia Score
Multiplier (5 = Ranking / Data X Ranking / Data X
most important; Weighting Weighting
1 = least Country Score Multiplier Country Score Multiplier
important) out of 2 out of 2
(2 = most (2 = most
attractive) attractive)
political risk H 5 16/25 = 2/2 10 10/15=1/2 1x5=5
corruption level H 5 16/25 = 2/2 10 16/25 = 1/2 1x5=5
level of future H 4 16/25 = 1/2 4 16/25 = 1/2 1x4=4
govt orientation
Political Subtotal 24 14
Legal Factors – National Level
Factor Data Source Weighting United United Kingdom Australia Australia Score
Multiplier (5 = Kingdom / Data X Ranking / Data X
most important; Weighting Weighting
1 = least Country Score Multiplier Country Score Multiplier
important) out of 2 out of 2
(2 = most (2 = most
attractive) attractive)
ease of doing H 5 2/2 10 1 1x5=5
business
intellectual H 5 2/2 10 1 1x5=5
property
judicial H 5 2/2 10 1 1x5=5
independence
Legal Subtotal 30 15
 Economic Factors - National Level
Factor Data Source Weighting United Kingdom United Kingdom Australia Ranking / Australia Score
Multiplier (5 = most / Data X Data X
important; Weighting Weighting
1 = least important) Country Score out Multiplier Country Score out Multiplier
of 2 of 2
(2 = most (2 = most
attractive) attractive)
Country Economic A 5 2/2 10 1 1x5=5
Risk
Economic Freedom A 5 2/2 10 1 1x5=5
Level
Financial Risk E 5 2/2 10 1 1x5=5
Economic Factors - 30 15
National Level
Subtotal

Economic Factors - Metropolitan Level

Factor Data Source Weighting Manchester Manchester Melbourne Melbourne Score
Multiplier (5 = most Ranking / Data X Ranking / Data X
important; Weighting Weighting
1 = least important) City Score out of 2 Multiplier City Score out of 2 Multiplier
(2 = most (2 = most
attractive) attractive)
Metropolitan GDP F 5 2/2 10 2/2 10
Metro urbanised F 5 2/2 10 1/2 5
area
Population density F 3 1/2 3 1/2 5
Economic Factors - 23 20
Metropolitan Level -
Subtotal
 Technological Factors – National Level
Factor Data Source Weighting United Kingdom United Kingdom Australia Ranking / Australia Score
Multiplier (5 = most / Data Score Data X
important; X Weighting
1 = least important) Country Score out Weighting Country Score out Multiplier
of 2 Multiplier of 2
(2 = most (2 = most
attractive) attractive)
mobile subscription by B 5 2/2 10 2/2 10
the population
innovation capacity B 5 2/2 10 2/2 10
network connectivity B 2 2/2 10 2/2 10
Technological Subtotal 30 30

Mobility Capability Factors – Metropolitan Level

Factor Data Source Weighting Manchester Manchester Score Australia Ranking / Australia Score
Multiplier (5 = most Ranking / Data X Data X
important; Weighting Weighting
1 = least important) City Score out of 2 Multiplier City Score out of 2 Multiplier
(2 = most (2 = most
attractive) attractive)
Resilience and overall H 5 2/2 10 1 =5
performance
vision and leadership H 4 2/2 8 1 =4
Inclusion and service H 3 1/2 6 1 =3
Mobility Capability 24 12
Factors –
Metropolitan Level
- Subtotal
Total Scores by Attractiveness
UK/ MANCHESTER AUSTRALIA / MELBOURNE
Factors
Political (National) 24 14
Legal (National) 30 15
Economic (National) 30 15
Economic (Metropolitan) 23x 1.5 = 34.5 20 x 1.5 = 30
Technological (National) 30 30
Mobility Capability 24 x 1.5 = 36 12 x 1.5 = 18
(Metropolitan)
Total 184.5 = most attractive 122 = least attractive