Rivkin, hbr, 2006 posted by patrick bertschy on october 3, 2011. He created the dhl global connectedness index and the cage distance framework. Pdf strategic analysis on cage framework and triple aaa. Ghemawats blog examines a number of ways that globalization can affect countries, individuals, and markets. Why do so many global strategies faildespite companies powerful brands and other bordercrossing advantages. Semiglobalization and international business strategy pankaj ghemawat harvard business school, boston, ma, usa correspondence. Ghemawat, strategy and the business landscape, 3rd edition. Director of the center for the globalization of education and management. Ghemawat is the anselmo rubiralta professor of global strategy at the iese business school at the university of navarra in barcelona, the jaime and josefina chua tiampo professor of business administration at harvard business school, and the author of four.
Seduced by market size, the illusion of a borderless, flat world, and the. Describe about the business strategy for cage framework. Custom analysis covering 184 countries and over 100 types of international activity. The cage distance framework the cultural, administrative, geographic and economic cage distance framework helps managers identify. Pankaj megawatt ghemawat is an international strategy guru who developed the cage framework the analytical framework used to understand country and regional differences along the distance dimensions of culture, administration, geography, and economics. The upper portion of the table lists the key attributes underlying the four dimensions of distance. Pankaj ghemawat disagrees with both and his case, backed by data, can be convincing. The cage distance framework identifies cultural, administrative, geographic and economic. Pankaj ghemawat born september 30, 1959 is an indianamerican economist, professor, global strategist, speaker and author known for his work in the study of globalization. Semiglobalization and international business strategy. This perspective, says ghemawat, blinds firms to a contrasting strategy. An analysis of pankaj ghemawats distance still matters.
First, to create an advantage, a firm must configure itself to do something unique and valuable. The acronym cage stands for culture, administrative, geographical, and economic. Jun 27, 2012 it helps to have friends in high places. But crossborder differences are larger than we often assume, explains pankaj ghemawat in redefining global strategy. The cage distance framework helps companies because it can evaluate countries. In it, they examine why large differences in economic performance exist, and how competitive advantage may be created. In this work, ghemawat proposes the cage distance framework that allows firms to consider four dimensions of. The more two countries differ across these dimensions, the riskier the target foreign market. The cage framework for countrylevel analysis cultural differences. Ghemawat 2007 specifies the components of cage distance framework on an example. Ghemawat asked his friend pascal lamy, director of the world trade organization, to estimate this figure excluding the doublecounting and triplecounting. By contrast, similarities along these dimensions suggest great potential. The cage distance framework is a tool that can be used to uncover important differences between various countries that companies should take into account when deciding on their strategy.
One of the framework was identified by ghemawat aaa framework in which the three as. The week 3 and week 5 has been analysed here to understand the topics properly and then the. It was written by pankaj ghemawat, a professor of global strategy at the iese business school in barcelona who served as open pdf files through vfp a faculty member. Fundamentals of global strategy a business model approach. Cage distance framework, where cage is an acronym for cultural, administrative. The customers willingness to pay for a product is the maximum amount of money that a customer would be willing to pay in order to obtain this product the suppliers opportunity cost is the smallest amount of money a supplier will accept for the product i. Cage distance framework, a powerful strategic tool toolshero. In 1983, theodore levitt, the late harvard business school professor and editor of the. Strategy and the business landscape is based on contemporary research in the field of strategy and adopts a valuefocused, firmcentered perspective that promotes an analytical approach to strategy. Associate editor of this journal, and was sponsored by the university of miami center for international business. Pankaj ghemawat is professor of business administration at the harvard business school.
In this work, ghemawat proposes the cage distance framework that allows firms to consider four dimensions of international distance cultural, administrative, geographic, and economic when planning global expansion. The expanded version of his dhl global connectedness index pdf, released in november 2012, measures the depth and breadth of 10 types of international flowsand finds them lacking. In order to prove this point, ghemawat provides interesting data to prove that crossborder flows of goods, services, capital, information and people are actually a lot more limited that most. Pankaj ghemawat is the global professor of management and strategy and director of the center for the globalization of education and management at the stern school of business at new. Adding value 1 pankaj ghemawat this note introduces the adding value scorecard and uses it to identify and calibrate the levers through which global strategy can create or destroy value, and to assess alternative strategy options. Ghemawat, a respected and renowned harvard business school professor, has written a business strategy book designed to help readers master a body of analytical tools and develop an.
For example, us companies would likely win over european ones should cuba open up its border to fdi. Ghemawats 2001 model proposes the analysis of the cultural. The report is covering the weekly session of the classes on e learning and has discussed the lessons taught in e learning clark. Apr 02, 2014 the fact that ghemawat was accused of thinking of the world as round in his talks over in india, make me wonder about corporate backed subsidiaries. The cage comparator analysis tool examines international flows and helps identify untapped opportunities for companies and countries. International strategy, cultural distance and management policies. The report is covering the weekly session of the classes on e learning and has discussed the lessons taught in e learning clark and mayer 2016.
The cage distance framework identifies cultural, administrative, geographic and economic differences or distances between countries that companies should address when crafting international strategies. He is the global professor of management and strategy and director of the center for the. In it, they examine why large differences in economic performance exist, and how competitive advantage. Whether, it is in the best interest of foreign corporations to back a view of a flattening world now rather than later in order to challenge controversial views of a western dominated media and. Globalization, the international integration, is adapted by an organization by adapting various approaches. Ghemawat socalled aaa framework offers three generic approaches to global value creation. Cage distance framework, where cage is an acronym for cultural, administrative institutional and political, geographic and economic distances among countries. Heres a more rational approach to evaluating global opportunities.
Jun 23, 2015 pankaj ghemawats aaa framework to evaluate global strategy june 23, 2015 dennisbarber in recent due to the volatile nature of various factors like economic conditions, dynamic nature of market factors, etc. In a blog post citing a study showing that growing dutch roses produces six. Aib insights vol 16 no 4 2016 q4 michigan state university. This note introduces the cage distance framework, which is used to identify and prioritize the differences between countries that companies must address when developing crossborder. Ghemawat 2001 proposes an analysis model known as the cage, which. Dr p ghemawat, harvard business school, soldiers field road, morgan hall 227, boston, ma 02163, usa. Adding value scorecard 1 adding value1 pankaj ghemawat. Ghemawat backs up his contrarian view, that the world is actually only about 10 to 25 percent globalized, with a fascinating set of statistics. May 06, 20 ghemawat backs up his contrarian view, that the world is actually only about 10 to 25 percent globalized, with a fascinating set of statistics. Pankaj ghemawats aaa framework to evaluate global strategy. Strategists pankaj ghemawat and jan rivkin appear in the hbr february 2006 edition.
Global prosperity and how to achieve it, and he takes the stage to ask an important question. The cage distance framework the cultural, administrative, geographic and economic cage distance framework helps managers identify and assess the impact of distance on various industries. Ghemawat is the anselmo rubiralta professor of global strategy at the iese. Pankaj ghemawat is the global professor of management and strategy and director of the center for the globalization of education and management at the stern school of business at new york university, and the anselmo rubiralta professor of global strategy at iese business school. Crossing borders in a world where differences still matter by pankaj ghemawat harvard business school press boston,massachusetts isbn. Clearly, apocalyptically minded authors have overstated the case for globalization, says ghemawat. The framework was developed by pankaj ghemawat, a professor at the university of navarra iese business school in barcelona, spain. The cage framework can be used to compare the chances of success of different countries in a given foreign market. He is the author of several widely influential articles on investment, disinvestment, and. See table 1 for a summary and the readings assigned for module ii for additional discussion. Pankaj ghemawats aaa framework to evaluate global strategy june 23, 2015 dennisbarber in recent due to the volatile nature of various factors like economic conditions. So says pankaj ghemawat, the most prominent flatworld skeptic in business circles today. Learn vocabulary, terms, and more with flashcards, games, and other study tools. Friedman assumes that the world is becoming much more globally integrated.
Tool kit companies routinely exaggerate the attractiveness of foreign markets, and that can lead to expensive mistakes. Strategy and the business landscape is based on contemporary research in the field of. In this work, ghemawat proposes the cage distance framework that allows firms to consider four. It may also be used to understand patterns of trade, capital, information, and people flows. One of the framework was identified by ghemawat aaa. As summarized in table the cage framework, the cage cultural.
Seduced by market size, the illusion of a borderless, flat world, and the allure of similarities, firms launch onesizefitsall strategies. This note introduces the cage distance framework, which is used to identify and prioritize the differences between countries that companies must address when developing crossborder strategies. A read is counted each time someone views a publication summary such as the title, abstract, and list of authors, clicks on a figure, or views or downloads the fulltext. May 27, 2015 globalization, the international integration, is adapted by an organization by adapting various approaches. Managing differences the central challenge of global strategy by pankaj ghemawat broader lessons pankaj ghemawat ph. Adding value 1 pankaj ghemawat this note introduces the adding value scorecard and uses it to. The cage distance framework identifies cultural, administrative, geographic and economic differences or distances between countries that companies should address when crafting. Pankaj ghemawat questions globalization effects european. Introduction of the cage comparatortm as a tool to analyze. Pankaj megawatt ghemawat is an international strategy guru who developed the cage framework the analytical framework used to understand country and. Friedman discussed the fact that the word is becoming easier to do global business in.
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