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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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 framesork CAGE-framework perspective. By analyzing the possible impact of dis- tance—in all its dimensions—you sweeten the odds of investing in profitable foreign markets.

Such models “resemble Newton’s law ghemawwat 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 reality or myth? By using this site, you agree to the Terms of Use and Privacy Policy.

The complete article reference is here: Ghemswat makes distance visible for managers. Distinct cultural differences are observed around the following dimensions: Also, types of distance af- fect industries differently.

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Landlockedness Lack of internal navigability Geographic size Geographic remoteness Weak transportation or communication links. The CAGE Distance Framework identifies Cultural, Administrative, Geographic and Economic differences or distances between countries that companies should address when crafting pankzj strategies.


How far apart are trading partners in physical terms: The hard reality of global expansion. Whatever it is… there is no denying the fact that…. The cultural, administrative, geographic, and economic CAGE distance framework helps managers identify and assess the impact of distance pwnkaj various industries.

Pankaj Ghemawat: Differences and the CAGE Distance Framework

Retrieved from ” https: Because geographic distance, for instance, affects the costs of transportation, it is of particular importance to companies dealing in heavy or bulky products. The more two countries differ across these dimensions, the riskier the target foreign market.

frzmework 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. Leave a Reply Cancel reply Your email address will not be published.

CAGE Distance Framework

How to choose foreign countries. Lack of colonial ties Lack of shared regional trading bloc Lack of common currency Political hostility. Trade practices between countries can be significantly affected by laws and regulations enacted at the national or international level.

Ghemawat emphasizes that different types of distance matter to different extents depending on the industry. Different languages Different ethnicities; lack of connective ethnic or social networks Different religions Lack of trust Different values, norms, and dispositions.

By contrast, similarities along these dimensions suggest great potential. This has been one of the biggest barriers, for instance, in the way of U.


CAGE Distance Framework – Wikipedia

The impacts of CAGE distances and differences have been demonstrated quantitatively via gravity models. 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.

framewori Ghemawat offers some advice on how the CAGE Framework can help managers considering international strategies:. Around 2, years ago, Greek philosopher Heraclitus of Ephesus had pronounced: 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.

The CAGE Framework – Distance Matters in Globalization!!!

A Financial Statement can be…. Because they affect fundamental business practices, they often affect the competitive position of firms as well. One of the distinctions between the CAGE Framework and other country analysis frameworks is its inclusion of bilateral as well as unilateral factors. 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. Related Posts 01 Jun.

The other day, a doctor was asking me about investment banking and why is it so hot. From Wikipedia, the free encyclopedia.