Documenti di Didattica
Documenti di Professioni
Documenti di Cultura
Process
1. Analyzing of existing mission & goals
To become market leader in the Indian pharma industry To achieve global leadership in protecting the health of masses
2. Organizational analysis of a global business firm Organizational Structure Export division Transnational company Marketing Mix Production- labor, raw material, inventory, plant layout Finance- Earning per capita, working capital, IFC 3. Analysis of international environment- PEST 4. Formulation of alternate corporate level strategies- stability, Growth, retrenchment, combination
5. Formulation of alternate unit level strategies Low cost leadership- Global Co. Focus- Transnational Co. Differentiation Other Offensive & Defensive strategies 6. Selection of best alternative strategies 7. Implementation
Strategic choices
Four basic strategies to enter and compete in the international environment:
International strategy Multi domestic strategy Global strategy Transnational strategy
International strategy
Create value by transferring valuable core competencies to foreign markets that indigenous competitors lack Centralize product development functions at home Establish manufacturing and marketing functions in local country but head office exercises tight control over it Limit customization of product offering and market strategy
Strategy effective if firm faces weak pressures for local responsive and cost reductions
Multi-domestic strategy
Main aim is maximum local responsiveness Customize product offering, market strategy including production, and R&D according to national conditions Generally unable to realize value from experience curve effects and location economies Possess high cost structure
Global strategy
Focus is on achieving a low cost strategy by reaping cost reductions that come from experience curve effects and location economies Production, marketing, and R&D concentrated in few favorable functions Market standardized product to keep costs low Effective where strong pressures for cost reductions and low demand for local responsiveness
Semiconductor industry
Transnational strategy
To meet competition firms aim to reduce costs, transfer core competencies while paying attention to pressures for local responsiveness Global learning
Valuable skills can develop in any of the firms world wide operations Transfer of knowledge from foreign subsidiary to home country, to other foreign subsidiaries
Transnational strategy difficult task due to contradictory demands placed on the organization
Example : Caterpillar
Enter through JV with the co. of host country Transfer of technology Develop the managers & HR Develop the basic facilities for the general public Avoid outdated & spoiled products Avoid the marketing of the products which may harm the health
Employ the local people to the great extent Treat the foreign employee & local employee equally Non involvement in political affairs of the host country Help the Govt. during the periods of natural disasters. Avoid the bribing & corrupting the officials
Pay tax accurately Maintain accounts ethically Maintain the sound business relations with business partners.