Question

Business Policies and Strategy

Write a 250 words post. Include in your answer the following questions.

1. What are the three main strategic approaches to competing internationally?

2. How can multinational competitors can use their international operations to improve their competitiveness?

3. What is profit sanctuaries and global strategic offensives?

Answer 1

Some of the most adopted and tested strategies to compete internationally are:

• Multi-domestic strategy – It simply means that customizing the product or service basis the domestic needs and tastes and preferences of the people in that particular geographical location. Example: McDonald do not sell beef burger in India because people in India do not eat it.
• Global strategy – The Company using this strategy does not alter its products much when they are selling it in different geographical locations, it ensures that the same product line is used and this is done to capitalize on the economies of scale as well.
• Transnational strategy – This is a balanced approach that the companies follow wherein they try and maintain a sync between both domestic and global strategy, some of the products are customized and served, this ensures that efficiency is also maintained and the tastes and preferences of the people is also taken into account. By far it is considered to be one of the most successful strategy.

Multinational competitors can capitalize on this as they have a better infrastructure, the workforce is diverse and present in various locations, their risk taking capacity is also higher, they can use the technology much more effectively to capitalize on the probable customers and can also make use of export rights to capitalize and gain an edge over the competitors.

Profit sanctuaries is nothing but a term that denotes the countries and locations where the company has a strong hold in the market and earns better profit. To ensure that the company is way ahead the rest of the companies, some of the organisations invest a lot of money in research and making their product better, this is what is called global strategic offensives.