International Level Strategy

Prof. R C Bhattacharya
GBS - 2015

www.globsynbschool.com Document Version: xx.xx.xx

Types of International Strategy

1. Multi-domestic
2. Global
3. Multi-national
4. Transnational

www.globsynbschool.com Document Version: xx.xx.xx

Multi-domestic Strategy

An international company adapting to local markets

Decentralized Strategy

Pros: Caters to locally distinct needs

Cons: High cost due to variety & lack of standardization

eg. Unilever

www.globsynbschool.com Document Version: xx.xx.xx

Global Strategy
Provides standardized products at low cost.

Pros: Economy of scale due to Centralized production

& R&D in a few locations.
Industry segments : - Aerospace / pharmaceuticals /
Consumer Electronics / Semi Conductors
Companies :- Boeing / Sony / Intel etc.

Cons: Organization may not realize the differential

needs of the local customers and thus decay

www.globsynbschool.com Document Version: xx.xx.xx

Multinational Strategy
An Organization exploits it's core competencies and
distinctive capabilities e.g. Nike concentrates it's
design and product development in US but
manufactures at different locations to reduce the cost
of distribution

Pros: Development of core competence and

distinctive capability at home and exploitation
worldwide

Cons: May not be able to cater to local needs

www.globsynbschool.com Document Version: xx.xx.xx

Transnational Strategy

Recognizes the efficiency derived from Centralized

operations but also recognizes the importance of local
responsiveness.

Pros: Centralized focus in R&D in home country with

production plans in low wage economies i.e.
Simultaneous centralization & decentralization.
Resources and capabilities can be leveraged centrally
but local units can be given liberty to innovate and
expand

www.globsynbschool.com Document Version: xx.xx.xx

 High
Need for globalisation to reduce cost

Global Transnational
Sony/Boeing Linde

Multinational Multi-domestic
Nike Unilever
Low

Low High
Need for localisation for Local responsiveness

www.globsynbschool.com Document Version: xx.xx.xx

 High

Wholly owned subsidiary

Amount of investment & risk

Joint venture

Strategic Alliance

Franchising

Licensing

Export
Low
Low High

Amount of ownership & control

www.globsynbschool.com Document Version: xx.xx.xx

THANK YOU

www.globsynbschool.com Document Version: xx.xx.xx