Discuss the motivations, means, and mentalities of companies that wish to expand their operations internationally. Include both traditional and emerging motivations. Describe the prerequisites that must be met for the means of internationalization. Discuss the four classifications of mentality. Solution Motivations to Internationalize - Traditional Motivations - Emerging Motivations Traditional Motivations - Need to secure important supplies - Market-seeking behaviors - Access to lesser-cost factors of production - Innovation is the beginning point of internationalization Emerging Motivations - Enhancing scale economies - Increasing R&D costs - Reducing PLC - Global scanning and learning ability - Competitive positioning The Prerequisites of Internationalization 1.) The capability to match or counteract the benefits of local competitors with certain unique strategic capability, like superior knowledge or skills (Technological), certain marketing competencies, and scale of economies in production, 2. The organizational ability to leverage its strategic assets more efficiently by its own subsidiaries than by licensing Four Mentalities International Mentality International operations are outposts supporting to the domestic parent company (decisions are ad hoc, opportunistic approach, low \'psychic distance\") Multinational Mentality Increasing exposure in foreign environments (leveraging opportunities by understanding differences among markets & operating environments, being nationally responsive)- Driven by exposure of foreign markets and the growing importance of international sales and profits Global Mentality Aim is to maximize efficiency (standardization & central coordination, items for the world market, \"the same thing, the same way, everywhere\") Transnational Mentality Several host governments, began to put restrictions and increase demands on these organizations.MNEs recognized the need to be responsive to local market and political needs, while retaining global efficiency.

1. Discuss the motivations, means, and mentalities of companies that wish to expand their
operations internationally. Include both traditional and emerging motivations. Describe the
prerequisites that must be met for the means of internationalization. Discuss the four
classifications of mentality.
Solution
Motivations to Internationalize
- Traditional Motivations
- Emerging Motivations
Traditional Motivations
- Need to secure important supplies
- Market-seeking behaviors
- Access to lesser-cost factors of production
- Innovation is the beginning point of internationalization
Emerging Motivations
- Enhancing scale economies
- Increasing R&D costs
- Reducing PLC
- Global scanning and learning ability
- Competitive positioning
The Prerequisites of Internationalization
1.) The capability to match or counteract the benefits of local competitors with certain unique
strategic capability, like superior knowledge or skills (Technological), certain marketing
competencies, and scale of economies in production,
2. The organizational ability to leverage its strategic assets more efficiently by its own
subsidiaries than by licensing
Four Mentalities
International Mentality
International operations are outposts supporting to the domestic parent company (decisions are
ad hoc, opportunistic approach, low 'psychic distance")
Multinational Mentality

2. Increasing exposure in foreign environments (leveraging opportunities by understanding
differences among markets & operating environments, being nationally responsive)- Driven by
exposure of foreign markets and the growing importance of international sales and profits
Global Mentality
Aim is to maximize efficiency (standardization & central coordination, items for the world
market, "the same thing, the same way, everywhere")
Transnational Mentality
Several host governments, began to put restrictions and increase demands on these
organizations.MNEs recognized the need to be responsive to local market and political needs,
while retaining global efficiency