Know the reasons why CAGE analysis emphasizes distance. Pankaj “ Megawatt” Ghemawat is an international strategy guru who developed the CAGE . Pankaj Ghemawat. What Are the Real Pankaj Ghemawat. How Global Are The CAGE Distance Framework. Cultural. Distance. Culture happens to be the first facet of CAGE, in terms of the acronym, but it also CAGE Framework, MBA discussions, Pankaj Ghemawat.
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Because they affect fundamental business practices, they often affect the competitive position of firms as well. Related Posts 18 Jul. Ghemawat emphasizes that different types of distance matter to different extents depending on frwmework industry.
Facebook has more than million users that makes it the 3rd largest country in the world. Views Read Edit View history. It makes distance visible for managers.
Whatever it is… there is no denying the fact that…. If you know the enemy and know yourself, you need not fear the result of a hundred battles.
Because geographic distance, for instance, affects the costs of transportation, it is of particular importance to companies dealing in heavy or bulky products. British politician and statesman known for his leadership of the United Kingdom during the….
The cultural, administrative, geographic, and economic CAGE distance framework helps managers identify and assess the impact of distance on various industries. Culture happens to be the first facet of CAGE, in terms of the acronym, but it also can be the most practically perplexing facet for managers. It should be a crucial consideration for a consumer goods or media company, but it is much less important for a cement or steel business.
The hard reality of global expansion. Application of the CAGE framewor, requires managers to identify attractive locations based on raw material costs, access to markets or consumers, or other key decision criteria.
The complete article reference is here: The other day, a gehmawat was asking me about investment banking and why is it so hot. Is value creation by Venture Capitalists a reality or myth?
Pankaj Ghemawat: Differences and the CAGE Distance Framework
How to choose foreign countries. One of the distinctions between the CAGE Framework and other country analysis frameworks is its inclusion of bilateral as well as unilateral factors. Ghemawat offers some advice on how the CAGE Framework can help managers considering international strategies:.
xage Each dimension of CAGE is described below. Sir Winston Churchill — Also, types of distance af- fect industries differently. Different languages Different ethnicities; lack of connective ethnic or cgae networks Different religions Lack of trust Different values, norms, and dispositions. For example, it can help explain the strength of Spanish firms in many industries across Latin America.
Such models “resemble Newton’s law of gravitation in linking interactions between countries to the product of their sizes usually their gross domestic products divided by some composite measure of distance.
This has been one of the biggest barriers, for instance, ghemaqat the way of U. This page was last edited on 12 Septemberat Lack of colonial ties Lack of shared regional trading bloc Lack of common currency Political hostility. One method to conduct quantitative analysis of this type is to discount specifically, divide raw measures of market size or potential with measures of distance, broadly defined.
The table   shown below provides more detail on each of the CAGE categories, and how they can manifest themselves depending on whether one is comparing a pair of countries or looking at one in isolation. Comment Name Email Website. Trade practices between countries can be significantly affected by laws and regulations enacted at the national or international level. For instance, a firm maybe ghemawwt interested in markets with high consumer buying power, so it uses per capita income as the first sorting cue.
Leave a Reply Cancel reply Your email address will not be published. Distinct cultural differences are observed around the following dimensions: By contrast, similarities along these dimensions suggest great potential.
Around 2, years ago, Greek philosopher Heraclitus of Ephesus had pronounced: The CAGE Distance Framework identifies Cultural, Administrative, Geographic and Economic differences or distances between countries that companies should address when crafting international strategies. The more two countries differ across these dimensions, the riskier the target foreign market.
How far apart are trading partners in physical terms: Landlockedness Lack of internal navigability Geographic size Geographic remoteness Weak transportation or communication links. The impacts of CAGE distances and differences have been demonstrated quantitatively via gravity models.