International Business Entry Case Study
City University of Seattle
March 31, 2013
1. What are some relative advantages and disadvantages of using smaller local partners vs a large local partner? Advantages:
Inside knowledge. Larger companies tend to focus more on big clients, which not necessarily have the same needs as private customers. Flexibility. Small companies are more likely to adapt to the policies asked from them. Disadvantages:
Low Budget. Small companies most time operate with low budgets, meaning that Microsoft must absorb marketing cost. High turnover. Small companies tend to have a small structure, then job opportunities are few, which force employees to change job. Poor customer service. Distributors mostly only care about selling off a product, then they direct customers with Microsoft. The main problem is that Microsoft Customer service is focused on developed countries, where the needs and tools are greatly different. In some cases the technical service is non-existent, heavily hurting the image of the company, not the distributor. Poor input for further developing products. If all the deployment and input is being done and received by a distributor, then it is most likely that the information will never reach Microsoft's engineering department. Without that knowledge products will stall for that particular market in a short period of time, inflicting loses in the long run for the company.
2. Are there countries where Microsoft’s strategy might not work? Why? Small countries with an unique language possibly are the toughest. Microsoft strategy mean that while local partners are relied to market the products, Microsoft is still in charge of the code and language. In that regard Microsoft is very vulnerable to small IT companies that develop solutions for their language. With small partners, it is easy for local developers to attract those distribution channels for their own product, therefore using...
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