Four IB strategies
Four IB strategies
1. Global Standardized Strategy
This strategy focuses on increasing profitability and profit growth by reaping the cost reductions that come from economies of scale, learning effects, and location economies; that is, their strategic goal is to pursue a low-cost strategy on a global scale. Example: packaging of the Chinese Red bull. Companies add value by adapting packaging based on consumer preferences. Gold is a symbol of wealth and happiness, and red is a symbol of good luck.
2. Transnational Strategy
In this strategy they are trying to simultaneously achieve low costs through location economies, economies of scale, and learning effects; differentiate their product offering across geographic markets to account for local differences; and foster multidirectional flow of skills between different subsidiaries in the firm’s global network of operations Example: HUL and HCCB are subsidiaries of their parent companies which follow a transnational strategy. The operations are locally controlled but centrally coordinated and interdependence among other subsidiaries is also present.
3. International Strategy
Taking products first produced for their domestic market and selling them internationally with only minimal local customization. Example: MacDonald’s, they have branches all over the world, the tastes of their products differ from one country to another to satisfy the wants of the market.
4. Localization Strategy
This strategy focuses on increasing profitability by customizing the firm’s goods or service so that they provide a good match to tastes and preferences in different national markets. Example: Coca-Cola, they offer the exact same taste, customized all over the world and they have branches all around the globe which focuses on increasing profitability where they compete over prices.
Dina Budair
1. Global Standardized Strategy
This strategy focuses on increasing profitability and profit growth by reaping the cost reductions that come from economies of scale, learning effects, and location economies; that is, their strategic goal is to pursue a low-cost strategy on a global scale. Example: packaging of the Chinese Red bull. Companies add value by adapting packaging based on consumer preferences. Gold is a symbol of wealth and happiness, and red is a symbol of good luck.
2. Transnational Strategy
In this strategy they are trying to simultaneously achieve low costs through location economies, economies of scale, and learning effects; differentiate their product offering across geographic markets to account for local differences; and foster multidirectional flow of skills between different subsidiaries in the firm’s global network of operations Example: HUL and HCCB are subsidiaries of their parent companies which follow a transnational strategy. The operations are locally controlled but centrally coordinated and interdependence among other subsidiaries is also present.
3. International Strategy
Taking products first produced for their domestic market and selling them internationally with only minimal local customization. Example: MacDonald’s, they have branches all over the world, the tastes of their products differ from one country to another to satisfy the wants of the market.
4. Localization Strategy
This strategy focuses on increasing profitability by customizing the firm’s goods or service so that they provide a good match to tastes and preferences in different national markets. Example: Coca-Cola, they offer the exact same taste, customized all over the world and they have branches all around the globe which focuses on increasing profitability where they compete over prices.
Dina Budair