Strategy of International Business PDF

e Strategy and Structure of International Business R.Paguirigan Time 2024.07.03  e Strategy and Structure of International Business Strategy:  “Actions that managers take to attain the goals of a rm.”  International business strategies refer to...

e Strategy and Structure of International Business R.Paguirigan Time 2024.07.03  e Strategy and Structure of International Business Strategy:  “Actions that managers take to attain the goals of a rm.”  International business strategies refer to the di erent approaches companies can take when expanding their operations globally. e four main international business strategies are:  e four main international business strategies International Strategy:  Companies focus on a single point of operation in their home market and expo standardized products/se ices internationally with little adaptation.  is allows for a recognizable global brand and consolidated operations, but less local responsiveness.  Examples: Red Bull, and Victoria's Secret.  e four main international business strategies Multi-Domestic Strategy:  Companies adapt their products/se ices to local market preferences in each count , rather than o ering a standardized global o ering.  is allows for high local responsiveness but less global integration.  Multi-domestic prioritizes customization over e ciency  Examples include Net ix and Heinz  e four main international business strategies Global Strategy:  Companies sacri ce local responsiveness in favor of cost e ciencies and economies of scale by o ering largely standardized products/se ices globally.  Examples include Microsoft, Procter & Gamble, and Intel.  e four main international business strategies Transnational Strategy:  Companies t to balance global integration and local responsiveness, o ering standardized core products/se ices while also adapting to local markets.  Examples include McDonald's, Nike, and KFC.  e Strategy and Structure of International Business  e choice of international strategy depends on the company's goals of balancing cost e ciencies and local adaptation.  Many companies sta with an international strategy and then evolve to a more complex model as they gain experience and resources.  e Strategy and Structure of International Business  Firms need to pursue strategies that need to increase “Pro tability” and “Pro t Growth”,  Pro tability: Rate of return the rms makes on invested capital  Pro t Growth: Percentage increase in pro ts over time To increase pro tability and pro t growth rms can,  Add value  Lower cost  Sell more in existing markets  Expand internationally  e Strategy and Structure of International Business Strategic Positioning: Firms need to choose either di erentiation or low cost, and the con gure internal operations to suppo the choice.  e Strategy and Structure of International Business Firms need to pick either a di erentiation or low- cost strategy as their prima basis for competing.  Di erentiation strategies focus on providing unique, valuable products/se ices that command a premium price, requiring investments in quality, branding, distribution and marketing.  Low-cost strategies aim to be the indust 's lowest-cost provider through operational e ciency, high productivity and economies of scale, minimizing costs at eve step  e Strategy and Structure of International Business Con gured Operations: Firm’s operations are like a value chain composed of a series of distinct value creation activities. Such as:  Production  Marketing  Materials Management  Research & Development  Human Resources  Information Systems  e Strategy and Structure of International Business Value Chain Activities  Production  Includes manufacturing, assembly, testing, packaging, and other physical production processes  Aims to create products e ciently and with high quality
 e Strategy and Structure of International Business Value Chain Activities 1. Production  Includes manufacturing, assembly, testing, packaging, and other physical production processes  Aims to create products e ciently and with high quality
 e Strategy and Structure of International Business Value Chain Activities 2. Marketing  Encompasses market research, adve ising, sales, and customer se ice
 Helps create value by understanding customer needs and e ectively communicating the product's bene ts
 e Strategy and Structure of International Business Value Chain Activities

3. Materials Management  Includes procurement, logistics, invento management, and distribution  Aims to ensure the right materials are available at the right time and place to suppo production
 e Strategy and Structure of International Business Value Chain Activities 4. Research & Development (R&D)  Involves new product design, process engineering, and technical se ices  Helps create value through innovation and continuous improvement 5. Human Resources (HR)  Includes recruiting, training, compensation, and employee relations  Helps create value by attracting, developing and retaining the right talent
 e Strategy and Structure of International Business Value Chain Activities

6. Information Systems  Encompasses data processing, information management, and technology infrastructure  Helps create value by enabling e cient operations and e ective decision- making