1. Define global strategy and explain different types. Give examples and pro’s and cons. (Do not only explain the 4 strategies but also look in to the axes)
A global strategy is a strategy that can be used when a company decides to expand their operations abroad to achieve competitive advantage and superior profitability. It defines a company 's strategic guide to globalization. A global strategy may be appropriate in industries where firms are faced with strong pressures for cost reduction but with weak pressures for local responsiveness. Global strategies require companies to tightly coordinate their product and pricing strategies across international markets and locations.
A company can decide to choose one of the four basic strategies. Global standardization strategy, localization strategy (multidomestic), transnational strategy, and international strategy.
Global standardization strategy - Companies that are pursuing a global standardization strategy focus on increasing profitability by lowering the costs that come from economies of scale and location economies. They want to market a standardized product worldwide, so they can gain maximum benefits from economies of scale. If there is strong pressure for cost reduction, and demand for local responsiveness is minimal, then a global standardized strategy is the best strategy to pick. These conditions prevail in many industrial goods industries, whose products often serve universal needs.
Localization strategy - This strategy focuses on increasing profitability by customizing the company 's products so that they provide a good match to tastes and preferences in different national markets. This strategy works if there is low pressure for cost reduction and if there is a high pressure for local responsiveness. By customizing the product offering to local