Glossary Chapter 10 BRIC nations Brazil, Russia, India and China. business format franchisors provide intangible rights and generally provide assistance in site selection, building, staff training, products supply, advertising and marketing plans, management accounting services, systems controls, and occasionally, financial assistance. consumption chain analysis the process of analyzing each step of the consumption chain — from awareness to disposal. cross-licensing agreement provides for the exchange of licensing agreements between the licensor and the licensee. first mover advantage those first to enter the market gain a number of economic and strategic advantages over those that subsequently enter the market. global learning the transfer of skills, R&D and production offerings that move back and forth between subsidiary offices and the home office. global strategy focuses on increasing profitability by pursuing a low cost strategy. greenfield this mode of entry involves establishing, from the ground up, a new operation in a foreign country. international strategy a strategy where the home firm wishes to lever by transfer its valuable competencies, skills and products to foreign markets. joint venture (JV) the formation of a separate legal entity that is owned by two or more independent entities to achieve a common mission. key success factors (KSFs) attributes that are most likely to contribute to the success of a firm in the target industry. licensing a budget-price technique adopted by a firm wishing to increase its export sales by contracting with a foreign firm under a licensing agreement. licensing agreement the right to use intangible property in the manufacture and sale of a firm's product under specific terms and conditions. multi-domestic strategy maximizes the customization of the firm’s goods and services offerings. In essence, the firm is replicating the home facilities (functions), and transplanting them to the foreign subsidiary. pioneering costs costs that are incurred by the first movers that will not have to be incurred by later entrants. product/trade name franchisors have established product names, logos and trademarks and they sell the right to use these intangible products to another party. SMART the system that helps a firm assess the company’s competitive position and its competitive strength vis-à-vis similar firms in the industry. strategic alliances partnerships between competitors, customers, or suppliers designed to build synergy. strategy the ‘game plan’ crafted by management to position the company in selected target markets in a sustainable fashion. SWOT the name of an effective tool to assess the internal (strengths and weaknesses) and external (opportunities and threats) of the company’s microenvironment. trans-national strategy the name of the strategy that tries to capture the global scale efficiencies and the benefits derived from being locally responsive to customers. turnkey project the name of the project when a company undertakes all aspects required to complete a project, and then turns the project over to the client for a fee. value creation undertaking activities that increase the value of the goods or services provided to your customers. wholly owned subsidiary a mode whereby a domestic firm acquires 100 percent of a growing concern.