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Change in Business Markets

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Andreas Schmoranzer

on 21 January 2014

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Transcript of Change in Business Markets

The Uppsala internationalization model revisited
Relational embeddedness = the interdependence between social relations, exchange of resources and combination of resources in the relationship
In business things rarely stay the same for an extended period. Companies must be willing to change and adjust operations for various factors, from a decrease in economic resources to a shift in consumer demand and production process changes.
Table of Content
1. Introduction
Change in Business Markets
Andreas Schmoranzer, Rudolf Wiesner, Mohammad Belal Hosen, Neele Küchler
Types of change which can be identified in the articles:
Product development
Viability of a firm
Rational Plan
Communication Web
Disciplined Problem
Integrative Model
Process performance
(=speed and productivity of product development)
Product effectiveness
Project leader,senior management and customers
Project team, leader, senior management and suppliers
Case study

closed system
Link between network structure and changes
2 forms of changes
Relationship establishment and technology development which both depend on the existing network structure (open or closed system)
Product development as rational plan, communication web and disciplined problem solving
Incremental change (Uppsala model)
Radical change
All in all it can be said that being part of an open system means that opportunities for collaborating on technology development are rare.
On the other hand being part of a closed system means
that the establishment of relationships in new
markets is not functional.
open system
Quick response to market demands

1. What kind of research stream applies to
2. What kind of research stream holds true
for Google?
3. Do you think that Apple has an open or
closed network structure?
Radical Dyad Change
Incremental Network Change
Incremental Dyad Change
Radical Network Change
Combination of Radical Change and Incremental Change Circle
Model for dynamics within business networks
Change is circular and an evolutionary process rather than unidirectional
Crucial importance of the Dyad Relationship
International new ventures
Dynamic of Business Networks
The Multinational Enterprise
Networking = Entrepreneurs tie connections to other firms or individuals in order to exchange knowledge, experience, and to broaden the horizon in terms of new technologies and foreign cultures.
MNE = a large company whose headquarter is in one country but having operations in one or more other countries and which both produces and sells goods or services in various countries
Characteristics of MNEs
Their affilitates must be responsive to a number of important environmental forces
They draw on a common pool of resources including assets, patents, trademarks, information and human resources
They link together the affilitates and business partners with a
common strategic vision
The internationalization process
Major types of foreign entry
Exporting and use of a local agent or distributor
Export through own sales representative or sales subsidiary
Local packaging and/or assembly
Foreign direct investment
Why firms become multinational enterprises?
What Triggers force the following Circumstances
A desire to protect themselves from the risks and uncertainties of the domestic business cycle
Radical Network Change
A growing world market for their goods or services
Incremental dyad Change
A response to increased foreign competition
Incremental Network Change
Radical Dyad Change
Question for discussion:

Do you think that MNEs offer better payment and working conditions?
The revised Uppsala model
Similarities between the articles
2. Types of change
3. Definitions
4. Product Development
5. Link between network structure and change
6. Dynamic of business networks
7. International new ventures
8. The Uppsala internationalization model revisited
9. Case study
10. Conclusion (Similarities & Differences
between the articles)
11. Quiz
Business network view of the surrounding area of an internationalizing firm
The original model needs to include the network approach

The validity of the establishment chain is declining
-> nowadays, companies leapfrog over stages
The firm has successfully gained a leading position in the international business arena
Free voice over internet protocol
Allows users to communicate across an internet connection by combining voice, video and instant messaging
The company is originated in Estonia

Released to public in 2003
Technology based firm
Forces for Stability
Critical Event
Critical Event
International new venture
The CEO of Microsoft and the CEO of Ford decided to form a joint venture with Car Point. Therefore consumers can design and order cars on the internet.
Information about the three companies
CarPoint is a consumer-oriented automotive Web site offering users complete car-buying and car-care information.

Ford is the world's largest producer of trucks and the second-largest producer of cars and trucks combined.

Microsoft is the worldwide leader in software for personal computers.
1. What is the vision of the new venture?
2. Why will the companies be successful in this new

The CEO of Ford believes that this joint venture will lead to enhanced car-buying and customer experience.

The CEO of Microsoft believes that CarPoint is going to change the way cars are bought and sold with technology that brings together manufacturers and dealers to deliver the services and cars consumers want.
Product development - Technology development

Nowadays the N
etwork Approach
is crucial for today's
success because of globalization and interconnected
business networks

Closed/open network - connected change

Leapfrogging over stages - Quick internationalization
forced by new ventures
Dyadic Relationships are crucial for changes in a business network
The impacts of change are strongly influenced by the intentions and interests of the affected parties
Change is an ongoing process in a business network
Incremental Network Change
Radical Dyad Change
Radical Network Change
Incremental dyad Change
Incremental Change Circle
Forces for Stability
Radical Change Circle
Forces for Change
Network Approach
Dyads act as recipients and carriers of changes
Full transcript