Chapter 10  
                                            Chapter 10  
              Global Sourcing Strategy: R&D, 
              Global Sourcing Strategy: R&D, 
                                Manufacturing, and 
                                 Manufacturing, and 
                             Marketing Interfaces
                              Marketing Interfaces
          Chapter 10                      Kotabe & Helsen's Global Marketing                              2
                                           Management, Third Edition, 2004
                                     Chapter Overview
                                      Chapter Overview
          1.  Extent and Complexity of Global Sourcing 
           1.  Extent and Complexity of Global Sourcing 
                  Strategy
                  Strategy
          2.  Trends in Global Sourcing Strategy
           2.  Trends in Global Sourcing Strategy
          3.  Value Chain and Functional Interfaces
           3.  Value Chain and Functional Interfaces
          4.  Procurement: Types of Sourcing Strategy
           4.  Procurement: Types of Sourcing Strategy
          5.  Long-Term Consequences of Global 
           5.  Long-Term Consequences of Global 
                  Sourcing
                  Sourcing
          6.  Outsourcing of Service Activities 
           6.  Outsourcing of Service Activities 
          Chapter 10                      Kotabe & Helsen's Global Marketing                              3
                                           Management, Third Edition, 2004
                          Introduction
                          Introduction
       Global competition suggests a drastically 
         Global competition suggests a drastically 
         shortened life cycle for most products, and it no 
         shortened life cycle for most products, and it no 
         longer permits companies a polycentric, country-
         longer permits companies a polycentric, country-
         by-country approach to international business.
         by-country approach to international business.
       An increasing number of countries are competing 
         An increasing number of countries are competing 
         head-on for global leadership.
         head-on for global leadership.
       In today’s competitive world, technology diffuses 
         In today’s competitive world, technology diffuses 
         quickly.
         quickly.
      Chapter 10        Kotabe & Helsen's Global Marketing   4
                         Management, Third Edition, 2004
                    Introduction (contd.)
                    Introduction (contd.)
       Without established sourcing plans, distribution 
         Without established sourcing plans, distribution 
         and service networks, it is extremely difficult to 
         and service networks, it is extremely difficult to 
         exploit both emerging technology and potential 
         exploit both emerging technology and potential 
         markets around the world simultaneously.
         markets around the world simultaneously.
       The increased pace of new product introduction 
         The increased pace of new product introduction 
         and reduction in innovational lead time calls for 
         and reduction in innovational lead time calls for 
         more proactive management of locational and 
         more proactive management of locational and 
         corporate resources on a global basis.
         corporate resources on a global basis.
       Global sourcing strategy requires a close 
         Global sourcing strategy requires a close 
         coordination among R&D, manufacturing, and 
         coordination among R&D, manufacturing, and 
         marketing activities across national borders.
         marketing activities across national borders.
      Chapter 10        Kotabe & Helsen's Global Marketing    5
                         Management, Third Edition, 2004
          1. Extent and Complexity of Global 
          1. Extent and Complexity of Global 
                      Sourcing Strategy
                      Sourcing Strategy
       Marketing managers should understand  and 
         Marketing managers should understand  and 
         appreciate the important roles that product 
         appreciate the important roles that product 
         designers, engineers, production managers, and 
         designers, engineers, production managers, and 
         purchasing managers, among others, play in 
         purchasing managers, among others, play in 
         marketing decision making. Marketing decisions 
         marketing decision making. Marketing decisions 
         cannot be made in the absence of these people.
         cannot be made in the absence of these people.
       U.S. MNCs are the most experienced in the 
         U.S. MNCs are the most experienced in the 
         industrialized world, and sell more than three 
         industrialized world, and sell more than three 
         times as much overseas through their subsidiaries 
         times as much overseas through their subsidiaries 
         as they export to the world.
         as they export to the world.
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                         Management, Third Edition, 2004