Roots of Globalization with success and failure : Globalization mantras9
a) Seek opportunities for growth through market diversification.
Company,Firms or individual(s) pursue internationalization strategies for a variety of reasons. Some motives are strategic in nature, while others are reactive. An example of a strategic, or proactive, motive is to tap foreign market opportunities or acquire new knowledge. An example of a reactive motive is the need to serve a key customer that has expanded abroad. Nine specific mantras include here :
b) Earn higher margins and profits.
c) Gain new ideas about products, services, and business methods.
d) Better serve key customers that have relocated abroad.
e) Be closer to supply sources, benefit from global sourcing advantages, or gain flexibility in the sourcing of products.
f) Gain access to lower-cost or better-value factors of production.
g) Develop economies of scale in sourcing, production, marketing, and R&D.
h) Confront international competitors more effectively or thwart the growth of competition in the home market.
i) Invest in a potentially rewarding relationship with a foreign partner.
At the broadest level, companies internationalize to enhance competitive advantage and to seek growth and profit opportunities.
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Organizationally, companies can choose a number of ways to grow internationally. They can grow organically, or they can purchase assets or capabilities in the international markets they are targeting. Alternatively, they can form an alliance or partnership with compatible local companies. Alliances continue to be a vital part of corporate strategy—particularly in markets with high uncertainty or where there are potentially promising growth opportunities a company does not want to pursue on its own. Alliances can be an effective way to spread investment cost in new technologies, manage the risks associated with emerging markets, and maintain flexibility by simultaneously pursuing diverging strategic paths.
Companies considering international expansions should evaluate the costs benefits of partnering with local companies versus doing it alone. One of the most important items they should take into consideration when evaluating such alliances is the potential conflicting interests of their partners. A reoccurring conflict of interest I have seen in similar cases was that the local entity may want to partner with a foreign company to go global, while the aim of the foreign company is the opposite: focus on the local market. So be aware and clear on what your interests are, as well as your partner’s from the beginning to avoid such misalignments in business objectives.
Most important idea for success globally to consider is that to appoint independent local representatives or work through distributors, make sure they don’t handle a zillion other business lines but rather will focus on promoting your product. However, they should be able to make “good money” working with you. Don’t try to squeeze every dime out of their margins; you bothshould be able to make money in this relationship if you want it to grow and be prosperous. If you appoint such independent representatives, make sure you don’t judge them with your home office matrices. The time frame to develop a market in Southern Indiana may take a year, but in Southern India may take two or three or five. After the steps you can surely enter the global market with any legal products.I am sure that you will be success very soon with in few months or perhaps a year .
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