1. What actions can managers take to compete more effectively as an international business?

2. How can firms increase profits through international expansion?

3. What international strategy should firms pursue?
4. Explain: Global Strategy – International Strategy –Multidomestic – Transnational Strategy
5. What are Advantages vs disadvantages of These 4 strategies? Give some examples.

1. INTERNATIONAL STRATEGY
Companies pursuing an international strategy will strive to create value by bringing valuable skills
and products to foreign markets, where local competitors lack these skills and products.
What sets these companies apart is that they sell a product that serves a worldwide need, but they
don't have to face major competitors, they don't face pressure to reduce costs.
They tend to centralize product development as research and development in the host country.
However, production and marketing are often located in each of the countries or regions in which
they do business.
Limited because of increased costs
Finally, for most companies that adopt an international strategy, headquarters often keep relatively
tight control over marketing and production strategies.
Conditions apply.
• The company has strong financial potential to be able to rebuild the entire production
system and distribution system in foreign markets. At the same time, it also creates
conditions for the company to survive and deal with competitors when they take actions
that affect the company such as: discounts, promotions, etc.
• The company has the ability to make a difference in skills, mad=f products that are difficult
for domestic competitors to meet.
• The company operates in the field of low pressure to reduce prices.
• Low pressure for local responsiveness
• Suitable for companies that have the ability to differentiate themselves from the
competition in terms of skills or products. At the same time, the company must operate in
a field with low pressure to reduce costs and low requirements to meet local demand.
ADVANTAGES DISADVANTAGES
- Entry to new markets. - Cost of establishing and termination of an
- Access to local talent. entity. Compliance risk.
- Increased business growth. - Business practices and cultural barriers.
- Stay ahead of the competition. - Managing international employees – HR
- Regional centres. and payroll obligations.
2. GLOBAL STANDARDIZATION STRATEGY
The strategy of launching the same products and using the same marketing strategy in all national
markets. Their strategic goal is to execute a low-cost strategy on a global scale. At that time,
production activities. Marketing, research and development will be located in a number of
favorable locations.
Conditions apply:
• The enterprise has sufficient financial potential, highly qualified human resources,
professional management qualifications, international business experience such as
understanding of the culture, law and politics of the country where it will do business. A
global strategy is possible when the pressure to respond to the is low. When businesses
face high pressure to reduce costs.
ADVANTAGES DISADVANTAGES
- It improves the life cycle of goods - Challenges of Foreign Culture
that are created. - Financial Risk
- It lessens the impact of - There are cultural influences that can
competitive businesses in the same make market penetration difficult.
industry. - There is always an operational risk that
- It is easier than ever before for a must be considered.
business to implement a - There are higher ongoing risks to
globalization strategy. obligation fulfillment.
- Globalization helps the world to - Although free trade is more prevalent
progress as a whole. than before, there are still barriers in
- It can help to reduce global place.
poverty. - A globalization strategy inevitably
shifts the primary working force to
low-cost labor nations.
- Globalization allows businesses to
have a greater influence on the political
arena.

3. MULTIDOMESTIC
• Multinational strategy aims to increase profitability by differentiating products, services
and businesses to suit different needs and tastes of each country. This strategy will cause
businesses to perform a number of repetitive activities, the product life cycle is short, so it
is difficult to achieve the goal of cost reduction.
Conditions apply:
• Multinational strategies are often not suitable for industries where price competition is.
• Penetrate into markets where localization pressure is high.
 ADVANTAGES
- Can meet the specific needs of -
each market more precisely.
- Can respond more swiftly to -
localized changes in demand.
- Can target reactions to the moves -
of local rivals.
- Can respond more quickly to local
opportunities and threats.
DISADVANTAGES
Hinders resource and capability
sharing or cross-market transfers.
Has higher production and distribution
costs.
Is not conductive to a worldwide
competitive advantage.

4. TRANSNATIONAL STRATEGY
• Transnational strategy is a combination of multinational strategy and global strategy. In the
current transnational company, core competencies and skills not only depend on the head
office but can be developed in any branch of the company in the world. Differentiating
products to match the needs of each region's market will lead to increased costs, which
goes against the goal of reducing costs of businesses.
Conditions apply:
• The transnational strategy focuses efforts on skills transfer and multi-directional supply
among subsidiaries globally.
• A company adopting a transnational strategy must strive for low costs and distinct.
ADVANTAGES DISADVANTAGES
- Expanding of Business. - Lack of Understanding
- Saving of Expenses. - Political, Legal and Operational
- Implementing other countries good Risk.
thing. - Risk of Loss of Control.
- Offers the benefits of both local - Is more complex and harder to
responsiveness and global implement.
integration. - Entails conflicting goals, which may
- Enables the transfer and sharing of be difficult to reconcile and require
resources and capabilities across trade-offs..
borders. - Involves more costly and time-
- Provides the benefits of flexible consuming implementation.
coordination.