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Chapter 4

Chapter 4. Globalization Strategies. What Is a “Think-Local, Act-Local” Approach to Strategy Making?. A company varies its product offerings and basic competitive strategy from country to country in an effort to be responsive to differing buyer preferences and market conditions.

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Chapter 4

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  1. Chapter 4 Globalization Strategies

  2. What Is a “Think-Local, Act-Local” Approach to Strategy Making? A company varies its product offerings and basic competitive strategy from country to countryin an effort to be responsive todiffering buyer preferencesand market conditions. 7-2

  3. Characteristics of a “Think-Local,Act-Local” Approach to Strategy Making • Business approaches are deliberately crafted to • Accommodate differing tastes and expectations of buyers in each country • Stake out the most attractive market positions vis-à-vis local competitors • Local managers are given considerable strategy-making latitude • Plants produce different productsfor different local markets • Marketing and distribution are adaptedto fit local customs and cultures

  4. When Is a “Think-Local, Act-Local”Approach to Strategy Making Necessary? • Significant country-to-countrydifferences in customer preferencesand buying habits exist • Host governments enact regulations requiring products sold locally meet strict manufacturing specifications or performance standards • Trade restrictions of host governments areso diverse and complicated they preclude auniform, coordinated worldwide market approach

  5. Drawbacks of a “Think-Local,Act-Local” Approach to Strategy Making Poses problems of transferring competencies across borders Works against building aunified competitive advantage 7-5

  6. What Is a “Think-Global, Act-Global” Approach to Strategy Making? A company employs the same basic competitive approach in all countries where it operates. 7-6

  7. Characteristics of a “Think-Global,Act-Global” Approach to Strategy Making • Same products under the same brand names are sold everywhere • Same distribution channels are used in all countries • Competition is based on the same capabilitiesand marketing approaches worldwide • Strategic moves are integrated and coordinated worldwide • Expansion occurs in most nations wheresignificant buyer demand exists • Strategic emphasis is placed onbuilding a global brand name • Opportunities to transfer ideas, newproducts, and capabilities from onecountry to another are aggressively pursued

  8. What Is a “Think-Global, Act-Local” Approach to Strategy Making? A company uses the same basiccompetitive theme in each country but gives local managers the latitude to • Incorporate whatever country-specific variations in product attributes are needed to best satisfy local buyers and • Make whatever adjustments in production, distribution, and marketing are needed to compete under local market conditions. 7-8

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