12 - Chapter 11 Strategy of International Business .

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Chapter 11 -- Strategy of International Business This chapter introduces the different types of  strategies  companies employ to  achieve their international business objectives. The combination of both national and  international environments complicates the formulation and execution of strategies. To  overcome these obstacles, companies formulate international, multinational, global or  translational strategies. They support this general approach to the market with  appropriate corporate, business, and department-level strategies. For strategies to be  implemented successfully, a company must select an appropriate organizational  structure  . Issues that affect organizational structure include centralized vs.  decentralized decision making and the need for coordination and flexibility. As well, both  strategy and structure are engendered within environments, all of the environments we  have been studying thus far.  What is critical for strategy to be effective is that it fit not  only with structure, but with the environments . For example, a multinational strategy fits  international business environments where the preponderance of pressures on the firm  are for local responsiveness. By contrast, where the preponderance of environmental  pressures are for cost reduction and standardization, a global strategy is more fitting.  KEY CONCEPTS EXPLORED The basic framework for analyzing which strategy is appropriate is the cost/local responsiveness framework . Where pressures for cost containment and local responsiveness are low, an international strategy can be employed. While this is an older strategy, fading in use due to globalization, what happens is that firms internationally
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This note was uploaded on 11/07/2011 for the course IBUS 330 taught by Professor Nicholson during the Fall '07 term at S.F. State.

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12 - Chapter 11 Strategy of International Business .

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