Week three - organisation of the international firm Flashcards
what do companies need to balance global rationalisation with
local responsiveness
how do strategists and marketers approach problems?
- strategists: centralisation vs decentralisation
- marketers: standardisation vs adaptation
what are the four P’s
- product
- price
- place
- promotion
what is meant by local dimension
each country is different, there is a high sensibility to differences in local markets
what pressures are there in the global dimension
- multinational consumers
- intensity of technology/investment
- multinational competitors
- universal tastes and needs
what are the pressures on the local dimension
- differences in tastes and needs
- differences in market structures
- local government requirements
- high transport costs
what is global convergence driven by
- the low cost and frequency of international communication, transport and travel
what is standardisation
the process of establishing uniformity across manufacturing materials and processes
what are the benefits of standardisation
- lower production costs
- economies of scale
- higher efficiency
what is global strategic alignment
buyers can shop at one global market, suppliers and competitors create global industries resulting in companies coordinating their global strategies
what factors facilitate a global approach
- political (reduces trade barriers)
- social (favours standardisation and global branding)
- technology (increases economies of scale)
- competitive (induces integration and coordination)
what is localisation
adapting a product or content to fit a specific market or country and adjusting its functional properties to accommodate the linguistic, cultural, political and legal differences
what is an international diversity perspective
strategists suggest you must be willing to adapt to complex variety and fragmentation that characterises our world
why is the level of international variety quite consistent
- habits change slowly, cultural norms are rigid
- legal differences
what factors facilitate a multi domestic approach
- cultural factors (reduces the benefits of standardisation)
- commercial factors (requires differentiated approaches to sales and marketing)
- legal factors (limits free flow of people, goods and data/imposes localisation constraints)
- technical factors (reduces the benefits of economies of scale)
what are the three main international strategic approaches for the international strategy
- global strategy
- transnational strategy
- multidomestic strategy