If we accept the ubiquity and importance of international activity in the contemporary business world, it is still incumbent on an author of “international strategy” to explain what is different about international strategy – to define what is both distinctively international and uniquely strategic about the topic. This will establish that the ideas and frameworks introduced in the text are not addressed by other disciplines. Since this is achieved by identifying four characteristics of international strategy, each of which features four explanatory factors, I refer to the framework as the “Rule of Four.”
This chapter highlights the first of the two factors that make international competition distinct from domestic competition – differences and decisions.
The distinctively international characteristics of international strategy arise when competition crosses national boundaries. Thus, they must derive from differences between countries either in current product or factor market conditions, or in the scale or rate of change of those conditions. I have identified four such fundamental differences.
But all such differences will be strategically irrelevant unless they require multinationals to alter aspects of the original domestic strategy. Thus, geographic heterogeneity must lead firms to reexamine certain decisions that drove their success within a single market. Many operational ...