Strategies and Organisation

Question 1

What are the 4 strategies

Answer 1

1- Transnational
2- Global Standardization
3- Localisation
4- International

Question 2

Why implement a Strategy

Answer 2

Strokosch- in order to achieve objectives commonly profit and social growth

Question 3

What is Transnational Strategy

Answer 3

Hill 2022- the head office retains strategic and operational control over international branches. These subsidiary branches tailor marketing and sales strategies to local preferences

Strokosch 2024- requires high cost reduction and local responsiveness

Question 4

Adv of Transnational Strategy

Answer 4

Hill 2022- can exploit experience curve to reduce costs as needed

indeed 2024- local responsiveness as can use local employees to gain insight how to alter products or marketing to local culture- increased sales

Question 5

Disadv of Transnational Strategy

Answer 5

Hill 2022- high cost reduction and local responsiveness pressures are hard to achieve simultaneously as often increased local responsiveness increases costs therefore forcing firms to often prioritise one

Question 6

Example of Transnational Strategy

Answer 6

Bayan tech 2024- Mcdonalds maintain high cost reduction and local responsiveness despite large scale operation still localises some items like the shrimp burger in Japan or the McRib in some European countries, USA and Canada

Question 7

What is Global Standardization

Answer 7

Indeed 2024- focuses on creating a standardised product to be sold globally with little to none alterations.

Hill 2022- usually in markets that econ of scale is key for competitiveness and has high cost pressures and little local responsiveness

Question 8

Adv of Global Standardization

Answer 8

Hill 2022- experience curve effects as increasing output decreases costs thus increasing profits

Strokosch 2024- exploit Location economies- by dispersing a firms value creation to locations where can be completed most efficiency and effectively. this decreases costs increases speed and quality

Question 9

Disadv of Global Standardization

Answer 9

Strokosch 2024- lack of local responsiveness

Indeed 2024- this lack of local responsiveness leads to decreased sales as brand lacks identity as doesn’t represent any culture making everyone feel not represented at all

Question 10

Example of Global Standardization

Answer 10

Bayan Tech- Apple as have a minimalistic design sells same product globally and even changed all charging ports to usb-c in alignment with new EU law

Question 11

What is Localization Strategy

Answer 11

Indeed 2024- this strategy aims to tailor the product and marketing to suit local consumers making it ideal to penetrate foreign markets

Hill 2022- has high local responsiveness and low cost reduction pressures

Question 12

ADV of localization

Answer 12

Strokosch 2024- customisation allows firms to sell in markets that had barriers to enter such as regulations or culture. gains competitive adv

Bayan tech 2024- highly personalised experience leads to higher customer satisfaction and brand reputation thus creating brand loyalty in new market

Question 13

Disadv of Localization Strategy

Answer 13

Strokosch 2024- high costs as cant use location economies or experience curve meaning firms must have the resources and funds to survive and afford this strategy

Question 14

Example of Localization Strategy

Answer 14

Bayan tech 2024- Nestle have a very diverse prodyct portfolio that alters from one location to another such as the macha kitkat in Japan. they also allow each reginal brand to control marketing, products and operations

Question 15

What is International Strategy

Answer 15

Strokosch 2024- takes products from domestic markets and sell them internationally without alterations

Hill 2022- low cost reduction and low local responsiveness pressures

Question 16

Adv of international Strat

Answer 16

Strokosch 2024- requires little work for firms as they transfer core competencies to foreign markets utilising a proven successful strategy lowering costs as no R&D or changes

Bayan tech 2024- lowers risks as tested in domestic market first before exporting internationally can save a lot of money

Question 17

Disadv of International Strategy

Answer 17

Hill 2022- lack of local responsiveness will make it hard to sell in culturally diverse locations due to no alterations of product or marketing that is often needed for success

Question 18

Example of International Strategy

Answer 18

Bayan Tech 2024- Netflix as they operate globally but will test local responsiveness before streaming world wide to ensure higher chance of success such as Squid Game and Money Heist

Question 19

What organisational structure is best for each Strategy

Answer 19

1- Transnational and matrix

2- global standardization and world wide product division

3- localization and world wide area structure

4- international and world wide product division

Question 20

Why Transnational use Matrix Structure

Answer 20

Strokosch 2024- as both have high product diversity and local responsiveness

Fiveable (2024)- allows firms to collab globally on standardised products whilst also customising strategies aligned to local markets. this collab decreases costs through centralised R&D, bulk production and streamlined operations maximise efficiency

Question 21

Transnational and matrix control systems

Answer 21

Hill 2022- requires exceptionally complex and efficient control systems due to multiple reporting relationships and shared authority. higher costs to maintain and decreased efficiency if conflicts arise

Question 22

Why Global Standardisation use WWPD

Answer 22

Strokosch 2024- HQ maintain majority of control over decisions however also allows localised decisions to be made

Question 23

Global Standardisation and WWPD- control systems

Answer 23

Hill 2022- strat has high control systems and as high coordination and need for cultural controls. this requires time and effective collab to ensure all tasks are completed in alignment with global strategy

Question 24

Why Localization Strategy use WWAS

Answer 24

Strokosch 2024- no need for integrated mechanisms making this simple structure good. this is cheap to control as each subgroup does their own thing

Hill 2022- operation and strategic decisions are decentralised increasing local responsiveness that is required

Question 25

Disadv of WWAS for Localisation

Answer 25

Hill 2022- can be difficult to transfer core competencies and skills between areas

Question 26

Why International Strategy use WWPD

Answer 26

Strokosch 2024- WWPD aligns with cost effectiveness and simplicity of international strategy needs

Strokosch 2024- moderate control demands similar to WWPD

Question 27

Disadv of WWPD for International Strategy

Answer 27

Hill 2022- limited control it proves local or country managers are viewed as less important to the product division managers leads to lack of local responsiveness and lower customer satisfaction