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International Business

International Business

Not all organizations are designed to compete globally. Therefore, Hout et al. (1982) recommend that companies first decide if their industry has the suitable characteristics to favor a global competitor before entering the international arena. An organization should analyze entrant economies where benefits include lower-cost units or enhanced reputations. Caterpillar, L.M. Ericsson, and Honda had different strategies when deciding how to enter the global stage. One common factor Hout et al. (1982) discuss for successful global expansion is perceiving competition as global and formulating a strategy on an integrated, worldwide basis.

Why should a company engage in international business in today’s current global environment?

According to the U.S. business administration, nearly 96% of consumers live outside the U.S., and two-thirds of the world’s purchasing power is in foreign countries (Benefits of Exporting, 2020). For an organization, international expansion means entering new markets as a disruptor and reaching more consumers, increasing sales. Other benefits include having a first-mover advantage, which allows them to build a strong brand presence before competitors enter the market.

Provide examples of companies that were successful in executing global strategy.

 Banutu-Gomez (2010) examines Coca-Cola’s international business strategy for globalization. Coca-Cola has mainly focused on differentiation, also referred to as a segmentation strategy for its global market. Coca-Cola has been able to do this by leveraging its branding internationally and its ability to focus on cost leadership- where an organization’s objective is to become the lowest-cost producer in the industry. Coca-Cola has also pursued other strategies in its international growth, such as acquisitions and collaborative agreements. For example, the company acquired 50 percent of its biggest competitor Inca Cola in Peru. In areas of the world, Coca-Cola has used collaborative agreements to enter multiple markets faster. The company owns 12.5 percent of Swire and Kerry bottling facilities in China. The company credits its international success with its “think global, act local” approach to entering local markets targeting local cultures and customs with its marketing.

Brennan (2018) analyzed Netflix’s rapid growth in the last seven years. Using two strategic moves- a three-stage expansion process into new markets and how it works with each market. In the first phase, Netflix did not enter all markets at once. The company focused on strategic markets that held perceived similarities. In its second phase, Netflix moved faster in entering more markets by utilizing the lessons learned from the first phase. The second phase consisted of financial investments in data, analytics, and content geared toward its expanded geographies. In the third phase, the company took what it learned in the first and second phases and focused on adding more languages and optimizing personalization algorithms, payment partnerships, and operations. The second stage was forming partnerships in new markets to create a win-win relationship.

Jham & Tandon (2012) examine Domino’s Pizza’s aggressive goal to capture 50 percent of the Indian pizza market using a Customer Relationship Manager (CRM) program. The CRM program followed an approach called D.M.A.I.C., which defined, measured, analyzed, improved, and controlled (Jham & Tandon, 2012). The program intends to retain and find new customers. The Domino’s brand was already a firm favorite within the Indian market. The company had a successful “30-minutes, or free delivery” marketing campaign promise consumers easily identified as relating to the brand. The marketing campaign also targeted key brand attributes: taste, convenience, and affordability (Jham & Tandon, 2012). While the program is ongoing, Domino’s brand has successfully established itself as the primary pizza brand in India thanks to its marketing and CRM program.

Smith Maguire & Hu’s (2013) article examines the perception of Chinese consumers of Starbucks. While the brand is strongly associated with foreign and Western, they have successfully created a sense of status within the social class. The brand is associated with being “modern” or “fashionable.” Another finding is that the brand is associated with good quality, trustworthiness, reliability, and reputation (Smith Maguire & Hu, 2013). The lack of food regulations and trust in government governance is essential to the Chinese market. Lastly, the research found that the Starbucks brand is seen as a “glocal bridge” between the American and Western cultures. The appeal of a global bridge can thus be understood not as an escape to ‘there,’ but as an affirmation of the connectedness of ‘here.’ (Smith Maguire & Hu, 2013).

Singireddy (2020) analyzes McDonald’s successful international marketing strategy and global branding. McDonald’s marketing strategy includes creating a marketing campaign recognizing economic, social, and religious values (Singireddy, 2020). McDonald’s also focuses on global performance, service, and food standardization. Finally, McDonald’s market segmentation strategy of knowing its biggest audience is maintaining its popularity.

Is their strategy similar to the Hout, Porter, and Rudden (1982) article? Explain.

 The examples of companies successfully executing a global strategy align with the Hout et al. article. These companies accommodated local differences without sacrificing production costs (Hout et al., 1982). For example, McDonald’s, Netflix, and Coca-Cola adapted their branding to local customs and kept local consumers in mind when launching new products. Word count 860

References

 Banutu-Gomez, M. B. (2010). COCA-COLA: International Business Strategy for Globalization. The Business & Management Review, 3(1), 155–169. ProQuest Central.

Benefits of exporting. (2020). Small Business Administration. https://www.sba.gov/business-guide/grow- your-business/export-products#section-header-0

Brennan, L. (2018, October 12). How Netflix Expanded to 190 Countries in 7 Years. Harvard Business Review. https://hbr.org/2018/10/how-netflix-expanded-to-190-countries-in-7-years? registration=success

Hout, T., Porter, M. E., & Rudden, E. (1982, September). How Global Companies Win Out. Harvard Business Review. https://hbr.org/1982/09/how-global-companies-win-out

Jham, V., & Tandon, S. (2012). Domino’s Pizza India Ltd.: Driving Business Growth through Consumer Engagement. Asian Case Research Journal, 16(01), 39–63. https://doi.org/10.1142/s0218927512500022

Singireddy, M. (2020). Mcdonald’s: Global Marketing. International Journal of Health and Economic Development, 6(2), 16–27.

Smith Maguire, J., & Hu, D. (2013). Not a simple coffee shop: local, global, and global dimensions of the consumption of Starbucks in China. Social Identities, 19(5), 670–684. https://doi.org/10.1080/13504630.2013.835509

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Question 


Read Hout, Porter, & Rudden’s (1982) article and review the three examples of companies that were successful in competing globally.  Each of the companies had a different approach to executing global strategy. Why should a company engage in international business in today’s current global environment? Using a minimum of five new peer-reviewed journal articles, provide examples of companies that were successful in doing this. Is their strategy similar to the Hout, Porter, & Rudden (1982) article? Explain.

International Business

International Business

Provide a 600 to 800-word summary (formatted according to APA guidelines) of the new
research in this area from a minimum of five new peer-reviewed journal articles and identify
questions that need exploring in future research.
Your discussion should be organized in a three-paragraph format:
Introductory Paragraph: gives an overview and definition of the topic you chose. At the end of
the Paragraph, it gives an idea of how your forum is organized.
Current Trends Paragraph: In this Paragraph, you will discuss the themes you found in
the research from the 5 articles related to your topic. This Paragraph should be a synthesis of the
research and not just a listing of annotated summaries.
Future Research Paragraph: In this Paragraph, you will discuss areas of future research by
referencing the 5 articles you identified. The future research areas should be based on the
findings of the authors of those articles rather than general ideas you may have.

Hout, Porter, & Rudden’s (1982) Article—-https://hbr.org/1982/09/how-global-companies-win-out

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