Philips vs Matsushita Case
1.Briefly describe reasons for Phillips and Matsushita to operate internationally. Why do they do it?
Describe the international strategy of Phillips and Matsushita using the international strategy classifications we discussed in class (e.g., localization, transnational, global). Philips and Matsushita are two electronic (equipment and service) based powerhouses who had to expand their business to the international market. One my ask why they needed to operate internationally… each company, Philips and Matsushita, wanted to stand in front of their peer companies as the market leader in the industry. In order to do this, each company would go through various changes, some of which hurt and some of which helped each company. Each company started very small sales and used two very different business strategies. Philips, the Dutch company, built their firm on the localization strategy. Philips built their post-war organization or NO’s. The National organizations were very self-sufficient and were able to respond to market conditions of the different countries they operated in. Consumer preferences played a big role in the development of Philips. Christopher A. Bartlett states, “in some countries, rich, furniture-encased TV sets were the norm; in others, sleek, contemporary models dominated the market.” This being said, National organizations were at a huge advantage to other companies because they could sense and take action to differences seen through various national markets. Matsushita, on the other hand, followed more of a globalization strategy focused on a more divisional structure. The firm focused on many worldwide divisions, which were capable of development, production and marketing. Each division or subsidiary of Matsushita was controlled by the parent company. This means that the headquarters maintains control over most of the decisions made at the division level. One downfall of this strategy was, unlike rival...
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