The globalization of the economy, internationalization of businesses and emergence of new markets are all key themes in contemporary business. Whereas international business may once have been the province of organisations with sufficient scale and reach, these types of companies — typically multi-national corporations – no longer have a monopoly on this kind of business. Increasing numbers of firms, of varying scale, are confronted with compelling reasons for expanding their activities across multiple national boundaries. In some cases, such motivation includes the knowledge that success in international markets is a pre-requisite for survival; if competitor organisations succeed in international markets, they may achieve the scale and liquidity which affords them sustainable competitive advantage. There are mainly three levels of international strategy. They are; Corporate Strategy Business Strategy Functional Strategies Short description of these three are given bellow, 1. Corporate Strategy: Corporate strategy attempts to define the domain of businesses the Continue reading
International Business Strategies
Case Study: The Strategic Alliance Between Renault and Nissan
Renault and Nissan are two major automobile brands working independently as well as are in a 19-year old alliance where Renault holds 43.4 percent stake in Nissan and Nissan owns 15 per cent in Renault. The Renault-Nissan Alliance is the first of its kind involving Japanese and a French company. Renault was identified for modern design and Nissan for the excellence of its engineering. The two companies had just decided to a most important strategic alliance in which Renault would take for granted $5.4 billion of Nissan’s Debt in return for a 36.6% equity share in the Japanese company. Before the alliance it was concluded that the combined company would be the world’s largest car-maker. In the case of Renault-Nissan, it is preferable to have an alliance than merger for many reasons. Alliances would facilitate more than mergers the entrance for companies to new geographical phases where there are Continue reading
Five Approaches to Differentiation Strategy
In order to achieve competitive advantage against the competitors, corporations carry out the strategy to distinguish themselves from the competitors in aspects of product, service, image, and etc. The focus of differentiation strategy is to creative the product and service, which is considered to be unique and special by the industry and customers. The foundations of the implement of differentiation strategy are customer needs, competitors, products and services levels. There are many means to carry out differentiation strategy. Such as product differentiation, service differentiation and image differences and so on. By carrying out differentiation strategy, the brand loyalty of users will be cultivated successfully and the corporation can also avoid the direct confrontation of competitors. Therefore, differentiation strategy is an effective competitive strategy, which enables the enterprise to obtain profits above the industry average level. Approaches to Differentiation Strategy Differential Product Strategy: In order to get an advantage different from Continue reading
Case Study: The International Growth of Zara
The emergence of global fashion has transformed the way fashion is perceived in the contemporary world. In the recent years, there has been a surge of global fashion brands; triggered by the intensive involvement of internationalization processes in the fashion industry. Large retailers in search of sustained growth increasingly decide to expand overseas, responding and contributing to the globalization process. Operating internationally is an increasingly common option for organisational growth. The process becomes a necessity when the domestic market shows increasing levels of competition and commercial saturation. Incidentally, there are increasing numbers of born-global companies deciding to internationalize their businesses from the beginning of their activities, regardless of the domestic market situations. The desire to benefit from the exposure of exclusive brands to foreign markets was one of the key motive for internationalization. Notwithstanding, internationalization strategies differ across retailers and also their results. During the initiation of an internationalization strategy, Continue reading
Case Study: Acquisition of Jaguar and Land Rover by Tata Motors
In 2008 Tata Motors, an Indian automaker wanted to expand its product portfolio and diversify its market base. It acquired the two iconic British brands Jaguar and Land Rover from the American automaker Ford Motor Corporation. This acquisition gave the company access to premium cars, a chance to add two iconic luxury brands to its stable and a global footprint. It gave struggling Ford a chance to rid itself of two loss-making vehicle units. The deal was transformational. It catapulted Tata Motors from a commercial vehicle and small-car manufacturer to a global player with marquee brands in its portfolio. The scale of the acquisition also was large relative to the size of Tata Motors. The purchase especially that of Jaguar, by an Indian company was viewed as toppling of the world order and many critics expressed doubts about Tata’s ability to retain the quality and standard of Jaguar Land Rover. Continue reading
Case Study: The Magic of Ford
In 1903, in a small wagon shop in Dearborn Michigan, a man by the name of Henry Ford started what is today the Ford Motor Company. It started it in 1896 when Henry Ford built his first car. It was only experimental at the time, but less than ten years later in 1908 he introduced a more updated version to the public. This became known as the Ford Model t. Once people realised what a wonderful novelty this was and how it would greatly facilitate their lives, there was a huge demand for them. In order for the company to be able to satisfy this heavy demand, ford introduced the world’s first assembly line for cars. It revolutionised the industry. By 1923 more than half of America’s vehicles were made by Ford. Today, the Ford Motor companies the number two company in its industry as well as the number two Continue reading