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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Application of the CAGE framework requires managers to identify attractive locations based on raw material costs, access to markets or consumers, or other key decision criteria. Comment Name Email Website. 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.
Each dimension of CAGE is described below. It fhemawat distance visible for managers. The hard reality of global expansion. Whatever it is… there is no denying the fact that…. By contrast, similarities along these dimensions suggest great potential. Sir Winston Churchill — 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.
Landlockedness Lack of internal navigability Geographic size Geographic remoteness Weak transportation or communication links.
The complete article reference is here: British politician and statesman known for his leadership of the United Kingdom during the…. The table   shown below provides more detail on each frajework the CAGE categories, and how they can manifest themselves depending on whether one is comparing a pair of countries or looking at one in gemawat.
Ghemawat emphasizes that different types of distance matter to different extents depending on ghsmawat industry. The cultural, administrative, geographic, and economic CAGE distance framework helps managers identify and assess the impact of distance on various industries.
By analyzing the possible impact of dis- tance—in all its dimensions—you sweeten the odds of investing frakework profitable foreign markets. Because geographic distance, for instance, affects the costs of transportation, it is of particular importance to companies dealing in heavy or bulky products.
If you know the enemy and know yourself, you need not fear the result of a hundred battles. Leave a Reply Cancel reply Your email address will not be published.
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The CAGE Distance Framework identifies Cultural, Administrative, Geographic and Economic differences or distances between countries that companies should address when crafting international strategies. How far apart are trading partners in physical terms: Distinct cultural differences are observed around the following dimensions: For example, it can help explain the strength of Spanish firms in many industries across Latin America.
Such models fraamework Newton’s law of gravitation in linking interactions between countries to the product of their sizes usually their gross gemawat products divided by some composite measure of distance.
The CAGE Framework – Distance Matters in Globalization!!! | EnrichWise
Ghemawat offers some advice on how the CAGE Framework can help managers considering international strategies:. From Wikipedia, the free encyclopedia. Different languages Different ethnicities; lack of connective ethnic or social networks Different religions Lack of trust Different values, norms, and dispositions.
The other day, a doctor was asking me about investment banking and why is it so hot. Because they affect fundamental business practices, they often framewodk the competitive position of firms as well.
Around 2, years ago, Greek philosopher Heraclitus of Ephesus had pronounced: The more two countries differ across these dimensions, the riskier the target foreign market. Think of international expansion as a movement along a continuum from known markets to less-known markets; a firm can move to more CAGE-proximate neighbors before cagee into markets that are portrayed as very different from a CAGE-framework perspective.
Also, types of distance af- fect industries differently.
How to choose foreign countries. Retrieved from ” https: Culture happens to be the first facet of CAGE, in terms of the acronym, but it also can be the most practically gnemawat facet for managers. Trade practices between countries can be significantly affected by laws and regulations enacted at the national or international level. This has been one of the biggest barriers, for instance, in the way of U.
Pankaj Ghemawat: Differences and the CAGE Distance Framework
This page was last edited on 12 Septemberat