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International Business Strategy

937 words | 4 page(s)

The integration of the economic activities across the national borders put different actors across the borders into the transaction and the businesses involves all the parties. In the case the effectiveness of globalization is determined by the economic actors in the private sphere also referred to as the multinational agencies and the state governments of the countries involved in the business (Kunnanatt 2013, p 46). Due these factors the benefits that are accrued from globalization are enormous but are enjoyed by a few people in the top of the management of the parties involved.

The governments of the developing countries are not involved in the determination of the prices of the products but are rather desperate to sell their products at any price dictated by the developed nations. This has increased disparities in the poor regions. The multinational agencies can help in diminishing the disparities by fighting for fare prices of the products for the poor nations. Or they can offer markets, with standardized prices for the products produced in the developing countries, which will in turn compel the developed countries to improve their prices (Tengblad & Claes 2010, p 652).

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Free trade is not fully incorporated in the world systems of trade, in that there are still disparities in the countries with conflicts. Free trade involves the multilayer trade where the inhabitants of a given country are freely allowed to get into other countries with the motive of carrying out the business. Because of insecurity issues, economic superiorities, cultural disparities and historical warfare grudges, countries have not been in a position to cooperate and involve them into trading without barriers. One of the principles of free trade is the principle of mutual benefit to the participants, but the situation in the current systems of trade reveal the superior nations, especially the Big Five determine the prices of the products and thereby discourage the involvement of other nations in free trade.

The choice of the strategy to implement in a firm will depend on the cost benefit that the firm is likely to accrue from the strategy. The cost benefit of the strategy will also depend on the cost of the merchandises that the multinational agency deals in, the modes of transaction and entirely the means of getting them to the markets (Choi, Kim & Kim 2010, p 301). From this perspective it is therefore tight to say that different firms pursue different strategies as this may be influenced by the factors stated above. Though the companies may be multinational agencies, the products they deal in may be different in a way (Valiukonyte & Parkkonen 2008, p 737).

Globalization implies the universal designing of the companies’ logos and other patches used to market the products so as to attract all the cultures around the world. This will imply for the companies which deal with products worldwide. The international strategy will mean that the organizations work to meet the cultural standards of specific countries which the company does business with. Transnational strategy involves the adjustment of the products with relevance with the cultural expectations in countries within given geographical and cultural localities. The cultures of one given country may influence the others close to it. Business can occur between countries with similar cultures (de Jong, Röell & Westerhuis 2010, p 780).

The multinational companies should behave according to the local regulatory standards of the countries where they are doing the business. So as to conduct business in foreign nations, the business corporation should strive to produce products that are appealing to the local people who are the inhabitants of the countries where they do their businesses. The expectations of the local people are linked to the sort of products and the cultural outline of the products that the multinational company produces. These are the people who form the market for the goods produced. If the company decides to heed to the regulatory standards in their home countries, the customers who are the local people may not be pleased to buy them since they may not be culturally friendly or odd at their face (Tengblad & Claes 2010, pp 669-669).

The development of the concepts of internationalization seemed fairly well with me, thought the concept of how to manage the CSR seemed a bit complex to my understanding. The methodology in which the multinational agencies decide to display their products even if this is contrary to what they have known for their regions of residence and nationality. The decision to act within the expectations of the local people is challenging at times as the local people may be culturally divergent to the ethical senses of the business agency.

Interactively, I have been able to gather different arrays of knowledge from the different sources. The incorporation of the knowledge on the possibility of the using different business strategies in multinational agencies and the influence of the determinants of different strategies in the market, have equipped me with quality knowledge. The possibility of the governments taking a way the benefits that are meant to motivate the poor farmers and producers in the developing nations, which increases the social disparities between the developed and developing nations as the state of poverty and knowledge among the people in developing worlds remain relatively low.

From the different forums I have learnt that the processes of globalization, localization and internationalization can be practiced by different multinational firms. My prior thoughts and knowledge equipped me with the reasoning that all multinational companies used a single strategy of globalization. I have also learnt that the multinational agencies should be very flexible in the business sector as the production of the products in designs will affect the moods and preferences of the customers.

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