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internationalizationprocess International Business Environment .pptx
- 2. STEPS IN INTERNATIONALISATION /GLOBALISATION 2 1 3 5 4 2 DOMESTIC COMPANY MULTINATIONA L COMPANY TRANSNATIONAL COMPANY INTERNATIONAL COMPANY GLOBAL COMPANY
- 3. 1. Domestic Company if it is not happening in the home country, it is not happening Limits its operations, mission and vision to the national political boundaries. Focuses its view on the domestic market opportunities, domestic suppliers, domestic financial companies, domestic customers etc Never thinks of growing globally If it grows, beyond its present capacity, the company selects the diversification strategy of entering into new domestic markets, new products, technology 3
- 4. 2. International Company The focus of these companies is domestic but extends the wings to the foreign countries. Go for international trade either forced by domestic or foreign forces Most of the companies follow this strategy due to limited resources and also to learn from the foreign markets gradually before becoming a global company without much risk. Extends the domestic country marketing mix and business model and practices to foreign countries Believe that the practices adopted in domestic business the people and products of domestic business are superior to those of other countries. 4
- 5. 3. Multinational Company Multinational company is also referred to as multi-domestic. Multi-domestic company formulates different strategies for different markets The orientation shifts from ethnocentric to polycentric. Under polycentric orientation the offices/branches/subsidiaries of a multinational company work like domestic company in each country where they operate with distinct policies and strategies suitable to the country concerned. 5
- 6. 4. Global Company Global company either produces in home country or in a single country and focuses on marketing these products globally, or produces the products globally and focuses on marketing these products domestically. Example - Harley designs and produces super heavy weight motorcycles in the USA and markets in the global market. 6
- 7. 5. Transnational Company Transnational company produces, markets, invests and operates across the world. It is an integrated global enterprise that links global resources with global markets at profit. A transnational company is geocentric in its orientation. This company thinks globally and acts locally. This company allows adaptation to add value to its global offer The assets of a transnational company are distributed throughout the world, independent and specialised 7
- 8. Chart : Different scenerio of internationalisation of companies 8 Stage of company 1. Domestic Company 2.International Company 3.Multinational Company 4.Global Company 5.Transnational Company Strategy Domestic International Multi Domestic Global Global Model N.A Co-oriented Federation Decentralise Federation Centralised Hub Integrated Network View of World Markets Home country Market Extension of Resources National and resources Global Markets Global Markets Orientation Ethnocentric Ethnocentric Polycentric Mixed Geocentric Key Assets Located in home country Core Centralised and other dispersed Decentralised and self sufficient All in home country except marketing or sourcing Dispersed, independent and specialized Role of country units Single country Adapting and leveraging competencies Exploiting local opportunities Marketing or sourcing Contribution to company worldwide Knowledge Home centred Created at centre and transferred Retained within operating units Marketing developed jointly and shared All functions developed jointly and shared