Lecture 6. International product decisions.

The objective is to provide you with some advice on the following relevant questions.
When and how does one standardize product features across country markets? And when and how are
they adapted to country specific needs?
The company will seek to profit from the advantages of standardization. This means that a company will
be inclined to standardize as much as possible to achieve efficiency gains.
Companies will be forced to adapt products to fit with local conditions:
Legal
Natural
Cultural
Economic
Before you start you must map the different attributes of your product
1. physical attributes such
2. symbolic attributes
3. service attributes
Physical attributes
Some of them must be standardized to comply with the law or environmental regulations for cars.
• Some others require cultural adaptations link to enduring social habits.
Also, natural adaptations are compulsory both for body related aspects and environment related
aspects. .
Lastly, economic conditions like purchasing power can impact on the degree of sophistication of sical
attributes.
So, in conclusion, there are numerous factors that eventually lead companies to adapt physical
attributes, which is, of course, costly.
• The good news here is that relatively new production methods allow for a better compromise
between customized products and large scale manufacturing operations.
• But lag of differentiation will allow for late adaptation in the production process as we see in the
aircraft manufacturing industry.
• International product design means designing physical attributes from the very outset that will match
as many local conditions as possible.
Symbolic attributes: languages
• The company needs to check whether the meanings conveyed by these attributes can be used across
country markets.
• For example, brand names may be interpreted or understood differently or even negatively in other
languages, and so in such a situation, a company would need to adapt.
Service attributes
it is rather difficult to standardise service attributes, for which there are several reasons.
For starters, service delivery conditions can differ significantly across country markets.
In addition, the style of interaction between service staff and the customer is different, and that it is
more informal in Scandinavia and more formal in Japan. And finally, even the content of the service
provided is often heavily adapted.
For example, did you know that the use of apps is almost entirely country specific?
Only very few apps are used worldwide, such as Facebook or WhatsApp, and even these require
linguistic adaptations.
And so, there are no 100% global products. Very often companies decide on mixed forms while by
tendency, standardization efforts will start with physical attributes, and are much less common with
service attributes.
Summary
1. Compulsory adaptations must meet legal requirements.
2. There may be necessary adaptations to cultural, natural, and economic specifics.
3. Marketing and production need to be aligned.
4. Implementing those decisions will require good alignment between product strategy, international
structures such as relationships between subsidiaries and corporate culture.