Two Misplaced Debates In Business Strategy

Two Misplaced Debates In Business Strategy

Of all debates in international business strategy, two stand out: The first debate revolves around the nature of world market environment, whether world markets are global, multinational or semi-global. The second debate revolves around the dilemma of global vis-a-vis local strategy, that is, the trade-off between global standardization and local customization. The way that an international business addresses these debates can make the difference between superior and inferior performance. Both debates are misplaced, and create pseudo dilemmas that lead to the wrong business strategy. The debate regarding the nature of the  [...]

Two Misplaced Debates In Business Strategy – ForbesMoscow International Business Center (Photo credit: Alexander Kachkaev) Of all debates in international business strategy, two stand out: The first debate revolves around the nature of world market environment, whether world markets are global, multinational or semiglobal. The second debate revolves around the dilemma of global vis-a-vis local strategy, that is, the trade-off between global standardization and local customization. The way that an international business addresses these debates can make the difference between superior and inferior performance. Both debates are misplaced, and create pseudo dilemmas that lead to the wrong business strategy. The debate regarding the nature of the world market environment is misplaced because it views multinationalization, globalization, and semiglobalization as universal and mutually exclusive trends that create a unique world market environment, rather than non-universal, non-mutually exclusive trends that create diverse world market environments. The debate regarding the trade-off between a global and a local strategy is misplaced because it views value propositions crossing national borders as products per se rather than as bundles of global and local characteristics. Within the later framework, business strategy begins with consumers’ preferences for global and local product characteristics in world markets, and the appropriate response to address them.

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