Pankaj Ghemawat, “Distance Still Matters,” Harvard Business Review 79, no. As summarized in Table “The CAGE Framework”, the CAGE (cultural. Dec 10, Culture happens to be the first facet of CAGE, in terms of the acronym, but it also CAGE Framework, MBA discussions, Pankaj Ghemawat. Pankaj Ghemawat . CAGE distance framework, where “CAGE” is an acronym for Cultural, Administrative The CAGE Framework for Country-Level Analysis.
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Different languages Different ethnicities; lack of connective ghemaaat or social networks Different religions Lack of trust Different values, norms, and dispositions. 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. Is value creation by Venture Capitalists a reality or myth? Because geographic distance, for instance, affects the costs of transportation, it is of particular importance to companies dealing in heavy or bulky products.
For instance, a firm maybe most interested in ghemasat with high consumer buying power, so it uses per capita income as the first sorting cue. Do you want fframework impress or confuse clients or Vice Versa? This has been one of the biggest barriers, for instance, in the way of U.
Comment Name Email Website. Retrieved from ” https: Because they affect fundamental business practices, they often affect the competitive position of firms as well.
Leave a Reply Cancel reply Your email address will not be published. Frakework of colonial ties Lack of shared regional trading bloc Lack of common currency Political hostility.
Views Read Edit View history. Gnemawat 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. 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.
Whatever it is… there is no denying the fact that…. 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.
Ghemawat emphasizes that different types of distance matter to different extents depending on the industry. How far apart are trading partners in physical terms: The CAGE Distance Framework identifies Cultural, Administrative, Geographic and Economic differences or distances between countries that companies should address when crafting international strategies. By analyzing the possible impact of dis- tance—in all its dimensions—you sweeten the odds of investing in profitable foreign markets.
The CAGE Framework – Distance Matters in Globalization!!! | EnrichWise
Facebook has more than million users that makes it the 3rd largest country in the world. The other day, a doctor was asking me about investment banking and why is it so hot. The more two countries differ across these dimensions, the riskier the target foreign market.
Ghwmawat impacts of CAGE distances and differences have been demonstrated quantitatively via gravity models. 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 moment you feel the need to hgemawat manage someone, you have made a hiring mistake.
CAGE Distance Framework
One of the distinctions between the CAGE Framework and other country analysis frameworks is its inclusion of bilateral as well as unilateral factors. The hard reality of global expansion. Related Posts 08 Jun. The complete article reference is here: By contrast, similarities along these dimensions suggest great potential. From Frameeork, the free encyclopedia. Distinct cultural differences are observed around the following dimensions: The cultural, administrative, geographic, and economic CAGE distance framework helps managers identify and assess the impact of distance on various industries.
The cgae   shown below provides more detail on each of the CAGE categories, and how they can manifest themselves depending on whether one is comparing a pair of countries or looking at one in isolation. This page was last edited on 12 Septemberat Here is the list of the….
Ghemawat offers some advice on how the CAGE Framework can help managers considering international strategies:. For example, it can help explain the strength of Spanish firms in many industries across Latin America.