Strategic Planning in Global Management

Multinational Strategies: Dealing With The Global-Local Dilemma

Resolving the Global-Local Dilemma: Formulating a Multinational Strategy

Local Responsiveness Solution

Strategy selection depends on the degree of globalization of the industry in which the company competes

Globalisation drivers - conditions in an industry that favour transnational or international strategies over multidomestic or regional strategies

Global Integration Solution

Global Local Dilemma

Respond to differences in the markets in all the countries in which the company operates in

  1. Global Markets

Conduct business similarly throughout the world

  1. Costs
  1. Governments
  1. Competition

Locate company units wherever there is high quality and low cost

Choice between local-responsiveness and global approach to a multinational's strategies

Forms the basic strategic orientation of the company

Common Needs

Multinational Strategies

  1. Multidomestic
  1. Transnational
  1. International
  1. Regional

Global Customers

Emphasizes local-responsiveness issues

Transfer Marketing

Are there global economies of scale?

Attract customers by selling products and services tailored to the needs of different countries

Global sources of low-cost raw materials

cheaper sources of high skilled labour

Usually costs more - Higher prices are then chargesd to recoup costs

favourable trade poilicies

Seeks location advantages and economic efficiency through operating worldwide

regulations that restrict operations

volume of imports and exports in the industry

strategies of the competitors

Sell global products and use similar marketing techniques worldwide

Manages raw material sourcing, production, marketing and support activities within a particular region

Known as a "compromise strategy"

Attempts to gain some economic advantages similar to transnational and international stratgy

Attempts to gain some local-adaption advantages of the multifocal strategy

Known as a "compromise approach"

Do not locate value-chain activities anywhere in the world

Hopes that the concentration of its R&D and manufacturing strengths at home brings greater economies of scale and quality than the dispersed activities of the transnational

Views any country as a global platform where it can perform any value-chain activity