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Pankaj Ghemawat, “Distance Still Matters,” Harvard Business Review 79, no. As summarized in Table “The CAGE Framework”, the CAGE (cultural. Pankaj Ghemawat. What Are the Real Pankaj Ghemawat. How Global Are The CAGE Distance Framework. Cultural. Distance. rated into the CAGE framework for understanding the differences be- . by Pankaj Ghemawat and Ken Mark, “Wal-Mart’s International.

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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 venturing into markets that are portrayed as very different from a CAGE-framework perspective. The cultural, administrative, geographic, and economic CAGE distance framework helps managers identify and xage the impact of distance on various industries.

Pankaj Ghemawat

Lack of colonial ties Lack of shared regional trading bloc Lack of common currency Framdwork hostility. Retrieved from ” https: The complete article reference is here: The impacts of CAGE distances and differences have been demonstrated quantitatively via gravity models. Each dimension of CAGE is described below. How far apart are trading partners in physical terms: Comment Name Email Website.

CAGE Distance Framework – Wikipedia

Ghemawat offers some advice on how the CAGE Framework can help managers considering international strategies:. Application of the CAGE framework requires managers to identify attractive pnkaj based on raw material costs, access to markets or consumers, or other key decision criteria.


From Wikipedia, the free encyclopedia. Views Read Edit View history. 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.

Is value creation by Venture Capitalists a dage or myth? Also, types of distance af- fect industries differently. A Financial Statement can be…. For instance, a firm maybe most interested in markets with high consumer buying power, so it uses per capita income as the first sorting cue.

Pankaj Ghemawat: CAGE Comparator™

Around 2, years ago, Greek philosopher Heraclitus of Ephesus had pronounced: Leave a Reply Cancel reply Your email address will not be published. By cae, similarities along these dimensions suggest great potential.

For example, it can help explain the strength of Spanish firms in many industries across Latin America. One of the distinctions between the CAGE Framework and other country analysis frameworks is its inclusion of bilateral as well as unilateral factors.

Trade practices between countries can be significantly affected by laws and regulations enacted at the national or international level. 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. Distinct cultural differences are observed around the following dimensions: Ghemawat emphasizes that different types of distance matter to different extents depending on the industry.


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. How to choose foreign countries.

It makes distance visible for managers. Because they affect fundamental business practices, they often affect the competitive position of firms as well.

The CAGE Framework – Distance Matters in Globalization!!!

Landlockedness Lack of internal navigability Geographic size Dramework remoteness Weak transportation or communication links. By analyzing the possible impact of dis- tance—in all its dimensions—you sweeten the odds of investing in profitable foreign markets. This has been one of the biggest barriers, for instance, in the way of U. Related Posts 01 Jun.

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.

If you know the enemy and know yourself, you need not fear the result of a hundred battles.