InternationalStrategy TheCaseofFedExByAlbinPinardMscInternationalBusinessDevelopment Contents InternationalStrategies StrategicChoicesReviewFedExBackgroundInformationWhyaGlobalStrategyforFedEx Conclusion StrategicChoiceFramework StrategicChoicesReview 4differentstrategicchoices Multi domesticstrategyHighlocalresponsiveness lowcostreductionpressures basedonDecentralization productsandservicestailoredtolocalmarkets InternationalstrategyParticularlyadaptedtofirmswhichenjoyavaluablecorecompetencethatcompetitorsinforeignmarketsdon thave TransnationalstrategyAdaptedtofirmswhichwanttosimultaneouslyachievelowcostanddifferentiationadvantages Thisstrategyremainshardtoimplementbecausebothpressuresareofteninconflict Globalstrategy FedEx TexasInstrument GlobalStrategyAspects Standardisation products services UniformMarketing homogeneityofcustomerresponsetothemarketingmix LargegeographicalcoverageBasedoncostreductionstrategies scaleseconomies Scopeeconomies Locationeconomies LearningCurves AdaptedtolowresponsivenessdemandlocationsSource Yip G S 1989 andViswanathan Dickson 2007 FedExBackgroundInformation Nationality USA Since1973 Internationalpresencesince1984 FedExmadetheexpressdeliveryindustry Activity ExpressdeliveryofpackagesanddocumentsworldwideThirdpartylogisticsprovider supplychainsolutions Annualrevenue2007 35 214 million Presencein220countriesand375airports 3 3millionpackageshippedeveryday 679aircrafts biggestfleetintheindustry 43500trucksand15internationalhubs 260000employeesworldwide Maincompetitors DHL UPS TNT Pushingthestandardisationtoitsmaximum verylawlocalresponsivenessintheexpressdeliveryindustry Focusingoncostreductionstrategies Centralizedcontrol Topmanagementtakesallthedecisions Extendingitsgeographicalcoveragethroughacquisitions Forcingairderegulation WhyaglobalstrategyisthemostappropriatedoneforFedEx Totalstandardisation ServicesanddeliverymethodsVerysimilardemandworldwide lowlocalresponsivenessISO9001certificationReinforcethestandardisationoftheFedEx sServicesworldwideMarketingPricing samepricesworldwideAdvertising globaladvertisingcampaign RelaxIt sFedEx StandardTechnologyInternationalcompatibilityofwirelessapplicationsFedExSuperTracker shippinginformationavailabletoemployeesandcustomersworldwideFedExe businesswebsite internationalstandardtechnology CostReductionThroughScopeEconomies TheFedEx sHubandSpokeNetwork Theoptimalcombinaisonoftransportmodes aircraft train trucks allowsFedextoachievescopeeconomies Internationalhub CostReductionThroughtheExperienceCurve Costreductionachievedoverthetimethanksto ExperienceofFedExinitsindustry firstmover advantage LearningeffectsthroughlearningbydoingBetterknowledgeofinternationalroutes gainoftime Decreaseofthenumberoflostpackagesoverthetime ThroughScaleEconomies Recentacquisitionof9BoeingA380 carry300 000lbsoffreight twiceasmuchasthepreviousMD 11model Singlemarketingstrategy significanteconomiesofscalethroughadvertisingandR D ExtensionoftheGeographicalCoverageThroughAcquisitionsofLocalFreightCompanies 2recentexemples 2006 acquisitionofHLCHoldingsLtd UK FedExgainsthecoverageof80UKcities 2200vehicules 2006 acquisitionofDTW China allowedFedExtotouch300newcitiesinChinaAcquisitionsoffreightcompaniesallowFedExto Increaseitscustomerbase fleet resources Enjoythebeneficeofanalreadyexistingbusiness quickeraccesstomarket ByForcingAirCargoDeregulation LeadingroleinLobbyingairderegulation U SAirCargoDeregulationAct1977 EncouragingU SgovernmenttoincludeaircargorightsinitsnegotiationswithcountriesinwhichFedExwantstooperate OpenSkiesAgreementwithChinain2005 MatrixStructure Pros Speedupthedecision makingReducebureaucracyMoreinterdepartementalcommunication Cons GenerateconflictsDoesnotallowlong termworkingrelationships ThroughCentralisationFedEx sWorldwideAreaStructure Tightcontrol FacilitatecoordinationConsistencyofdecisionsAvoidsDuplicationEasiertomakechange Pros First moveradvantageinitsinternationalexpansion since1984 Core compentencesbasedathome nooutsourcing SignificantE businessadvanceofFedEx KEYstrenghasInternetreinforcesstandardisationCons Crossculturalproblemsincreasewithglobalstrategy mana