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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Application of framewprk CAGE framework requires managers to identify attractive locations based on raw material costs, access to markets or consumers, or other key decision criteria.

The CAGE Framework – Distance Matters in Globalization!!!

Ghemawat offers some advice on how the CAGE Framework can help managers considering international strategies:. Related Posts 01 Jun. Because they affect fundamental business practices, they often affect the competitive position of firms as well.

Also, types of distance af- fect industries differently. This page was last edited on 12 Septemberat The CAGE Distance Framework identifies Cultural, Administrative, Geographic and Economic differences or distances between countries that companies should address when crafting international strategies.

The hard reality of global expansion. How to choose foreign countries. Because geographic distance, for instance, affects the costs of transportation, it is of particular importance to companies dealing in heavy or bulky products.

Views Read Edit View history. By contrast, similarities along these dimensions suggest great potential. Leave a Reply Cancel reply Your email address will not frmaework published.

The CAGE Framework – Distance Matters in Globalization!!! | EnrichWise

The more two countries differ across these dimensions, the riskier the target foreign market. Trade practices between countries can be significantly affected by laws and regulations enacted at the national or international level.


By analyzing the possible impact of dis- tance—in all its dimensions—you sweeten the odds of investing in profitable foreign markets. Rfamework makes distance visible for managers. A Financial Statement can be….

Pankaj Ghemawat

For example, it can help explain the strength of Spanish firms in many industries across Latin America. Ghemawat emphasizes that different types of distance matter to different extents depending on the industry.

This has been one of the biggest barriers, for instance, in the way of U. Around 2, years ago, Greek philosopher Heraclitus of Ffamework had pronounced: Landlockedness Lack of internal navigability Geographic size Geographic remoteness Weak transportation or communication links. Comment Name Email Website. Distinct cultural differences are observed around the following ghemawaat Different languages Different ethnicities; lack of connective ethnic or social networks Different religions Lack of trust Different values, norms, and dispositions.

Lack of colonial ties Lack of shared regional trading bloc Lack of common currency Political hostility.

CAGE Distance Framework – Wikipedia

By using this site, you agree to the Terms of Use and Privacy Policy. The impacts of CAGE distances and differences have been demonstrated quantitatively via gravity models. Whatever it is… there is no denying the fact that….

For instance, a firm cate most interested in markets with high consumer buying power, famework it uses per capita income as the first sorting cue. 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. Think of international expansion as a movement along fraework 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.


From Wikipedia, the free encyclopedia. If you know the enemy and know yourself, you need not fear the result of a hundred battles. Each dimension of CAGE is described below. The table [4] [5] shown below provides more detail on each of the CAGE categories, and ;ankaj they can manifest themselves depending on whether one is comparing a pair of countries or looking at one in isolation. One of the distinctions between the CAGE Framework and other country analysis frameworks is its inclusion of bilateral as well as unilateral factors.

The cultural, administrative, geographic, and economic CAGE distance framework helps managers identify and assess the impact ghejawat distance on various industries. 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. Framewokr value creation by Venture Capitalists a reality or myth? The complete article reference is here: Retrieved from ” https: 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.

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 pnkaj some composite measure of distance. The other day, a doctor was asking me about investment banking and why is it so hot. How far apart are trading partners in physical terms: