1. International Strategy
Elizaveta Ogloblina
Terese Persson
Karoliina Rnjak
Adrian Späthling

2. Introduction
national boundaries are no longer constraints for companies
many theories
focus on four different approaches to the host countries

3. The Triad (Kenichi Ohmae 1985)
Regional Trading blocks
Europe (Germany)
North America (USA)
Asia (Japan)
Global strategy has a regional, often triad-based feature

4. Reasons to go abroad saturated domestic market cheaper production
research and development capacity
reduction of seasonal effects
diversification
different competition abroad

5. Different Strategies International Strategy Multidomestic Strategy
transfer of products and skills
Multidomestic Strategy
maximum local responsiveness
Global strategy
low cost strategy
Transnational strategy
cost pressures and responsibility pressures

6. Pressures for Local Responsiveness
FOUR BASIC STRATEGIES
High
Transnational
Strategy
Global
Strategy
Cost Pressures
International
Strategy
Multidomestic
Strategy
Low
Low
High
Pressures for Local Responsiveness

7. International Strategy
value creation by transfer of skills and products to foreign markets
lack of local competitors with skills and products
developed at home and introduced into foreign markets
centralized management
manufacturing abroad  duplication

8. Multidomestic Strategy
response to different national needs
cultural
preferences
legal / political
infrastructural
broad guidelines from headquarter
most of the management is done locally  duplication
bottom-up strategies

9. Global Strategy (1) Transferring distinctive competencies
Realizing location economies
-optimal location for each activity
->value creation is maximized or costs of value creation are minimized
Moving down the experience curve
-The longer a product is produced the more
experience is gained and costs go down
->With consentrated production, duplication of the learning process is avoided

10. Global Strategy (2) cost reduction by standardization
coordinated and economic use of resources
top-down strategy
convergence in buyer preferences in worldwide markets
willingness to sacrifice preferences for cheaper products

11. Transnational Strategy
local responsiveness and cost reduction
focus on core competences with adjustments
two-way communication
same product with different features

12. Comparison Multi Global (Triade) best market response
adapted product
duplication
just one law to follow
Global (Triade)
best cost advantages
standardized product
economies of scale
several laws to follow

13. Case Study Procter&Gamble
established 1837
household cleaning and hygiene products
turnover 02/03:
Austria € 176 Million
Global € 35 Billion
employees 02/03:
Austria 76
Global

14. Case: Vizir Launch first heavy-duty liquid detergent
should be seen by consumers as a main washing product with superior cleaning performances at lower temperatures
easier and cheaper to produce than powder
easy to copy by competitors

15. Problems to be launched in Germany or Europe
marketing strategy
one or different formulas
danger of creating a product that is
too expensive but perfect for everyone
cheap but nobody likes it
not competitive in any market

16. Possible Solutions
launch in Europe right away, since it is easy to copy
combine countries into geographic regions
limited diversity for formula and marketing
long-term: alliances with
washing machines manufacturers
clothing industry

17. THANK YOU FOR YOUR PATIENCE!