Examine the impact of globalization on the strategy of a business

INTRODUCTION
1) DEFINE GLOBALIZATION AND STRATEGY (CONCEPTS)
2) PUT YOUR ORGANIZATION INTO CONTEXT
3) OVERVIEW OF THE COMPANY
4) MENTION THE TOOL/CONCEPT GOING TO BE USED TO DISCUSS THE
QUESTION

TOOL-PEST, SWOT, GLOCALIZATION

Change - Driving forces and restraining forces creates change in a business so that they
can move forward and remain competitive.
Culture - the norms of an organisation, a country, or other social grouping. Culture
shapes the values, beliefs, and customs of people. (Internal and External sections of the
organisation)
Ethics - the socially accepted moral principles that guide decision making, based on the
collective belief of what is right and what is wrong.
Globalisation - worldwide movement toward economic, financial, trade, and
communications integration
Innovation - Innovation generally refers to changing or creating more effective processes,
products and ideas, and can increase the likelihood of a business succeeding.
Strategy - devising plans to achieve the long-term goals of an organisation

The biggest difference is that they tend to be cheaper and are better at
meeting Chinese food preferences, with options like tuna salad bagels
with corn, fish fillet burritos, and a hamburger with a deep-fried shrimp
patty smothered in XO sauce and sandwiched with a rice patty.

CRITERION CHECKLIST

Criterion B-
The given concepts and relevant business
management content are well applied to explain the
situation and issues of the real-world organization(s).
Examples are appropriate and illustrative.

- Use accurate examples

- Examples are discussed in detail
- The concept chosen is relevant in context to the case/organization
chosen
- Advantages and disadvantages should be discussed to explain the
situation and issue.

Criterion A- knowledge and understanding

Concepts should be defined
(introduction)
Use your business terminology
You subject concept has to be stated clearly (point)
And explained

Criterion B-application
Specific and accurate case specific examples
Applying the concept to the case

Criterion C- reasoned argument

Advantage and disadvantage of the concept in context to the case
Conclusion needs to be developed from the body and should answer the
question

E -Stakeholders
At Least 4 different group of stakeholders
At least one individual stakeholder-CEO
Group stakeholders- consumer,competitor, supplier, pressure group,
employees and government
Impact on stakeholders needs to be discussed

D-Structure
Introduction
Body
Conclusion

CUEGIS NOTES

To what extent globalization forces a company to change

Nike
point:Outsourcing
It’s a mnc sportswear company.
home-country-usa
Outsourcing in China (multinational companies exploit workers out of the pretext of
giving them a job)
Underpaid workers/poor working conditions
Advantages
Cost advantage
Understanding the market
Disadvantages
Stakeholder conflict
Ethical issues
Stakeholders
Employees
bod/consumers

Point: sustainability (to look after the needs of the future generation)

Example: 75% of recycled material-air shoes

Advantage: brand image, attracting stakeholder groups, publicity and marketing.

Disadvantage: could be considered as a publicity gimmick/cost.

Point: uses innovative marketing and promotional strategies.

Example: sponsoring world famous athletes/ brand ambassadors
Tying up with football players
Advantages: reaching out a worldwide audience, helps in product development, brand
image

Disadvantage: image of the athletes will affect the brand image, costly exercise.

Stakeholders: Athletes: Individual:customer

Change: making alterations to their products,strategy, to address the change in the

environment.

APPLE- TO WHAT EXTENT INNOVATION AFFECTS STRATEGY

To what extent organizational culture affects strategy?

Beliefs, practises guiding an organization

Mnc focus on employee growth & innovation

Eg- partners health insurance stock option

Advantage- brand image
Disadvantage- cost
Stakeholders-employees and competitors

To what extent innovation brings about a change?

INNOVATION
Product innovation
-creating new products
-making changes to the product

Process
-newer,improved production or delivery method

Positioning
Changing the target segment

Paradigm
Completely reinventing the organization

AMAZON CASE STUDY

Point 1-MNC’s like amazon have changed the retailing method around
the world

Example- amazon is one of the first companies to promote online retailing by

having branches around the world

Advantages- widespread/cost effective strategy/products are cheaper/better

marketing

Disadvantages- traditional retailers face backlash/internet as a

medium/quality/security
Traditional backlash- unemployment
Stakeholders- consumers/competitors/government ( foreign company taking
away everything. Unemployment-government gets involved)

Point 2- MNC’S are often credited with bringing about a paradigm shift
in consumer

Example- kindle, alexa, amazon prime

Advantage- Global market/economies of scale/ convenience/change

Disadvantages- prime-local cinema
Dying out of bookstores

Stakeholders- cinema/publishing companies

Innovation is costly, research is needed

Amazon followed trends
To what extent ethical failures are a result of poor strategy? (Walmart)

MNC’s resort to false marketing practices in order to gain more profits

Example- They advertised certain products as “green
products”/environmentally friendly products, however when an audit was
issued, the products which were advertised as green products were found to
have plastic.

Advantages- brand image (environmental sustainability)

Disadvantages-Publicity gimmick

Stakeholder- consumer/pressure groups

MNC’s are guilty of underpaying workers to make more profits

Example- women are paid less than men/discrimination
Pregnant women: overworked
Maternity leave issues
Discrimination against disabled people

Advantage- lesser productivity-lesser pay-providing employment

opportunities
Disadvantage- lawsuits/brand image
Stakeholders- conflict-bod/employees.

POINT- MNC’s are guilty of violating human rights for eg-employing

children
Eg- employing children in bangladesh/fire/killing people/stress/exploitation

Advantages- bangladesh developing country

Justification-laws weak/reduce cost/misusing position of power
Disadvantage- brand image
Stakeholder conflict
government/media pg/competitor/ngos

Point- MNC’s resort to unfair trade practices to earn profit

Example- walmart reduces prices to lowest possible to disrupt
competition(india)
Advantage- overcome competition/economies of scale
Disadvantages- creating unhealthy competition price-war
Stakeholder- competition/government

Conclusion
1) Profit maximization vs services
2) Why this needs to change
3) How do companies justify it
4) The larger impact

CUEGIS
Mcdonalds
Nestle
Apple
Google
Nike
Amazon
Walmart
Dominos
Amul
Coca cola

ANSOFF MATRIX
DEFINITION
 (market penetration): It is a strategy involving selling existing goods to existing markets to
obtain a higher market share.

Changing price
Engaging in public flavours
Providing promotional discounts
Investing in promotion
Starting up new outlets
Changing packaging
Changing product size

Advantage
Less risky
To increase customer base
Cost benefits (economies of scale)
Overcome competition

Disadvantage
Lack of results
May lead to poor brand image
Uncertainty with the initial cost

DEFINITION
Market development: strategy adopted by a company targeting a new audience without
changing the product.
New market- a new consumer base age/group/location/gender

ANY MNC’S entering the host country for a first time-market development

DEFINITION
Strategy adopted by a company to create new product in their existing market (new or
modifications)

Coca cola- cherry coke-flavour

Nissan-electric vehicle
Tesla
Dominos
DEFINITION
Strategy adopted by a company in developing new products for a new

Product- related- catering to products in the same industry

Apple- laptops-phones
Unrelated-coming up
Diversification with a new product for a new market
GLOBAL CONGLOMERATE
TATA VIRGIN GROUP
RELIANCE

Advantages
Spreading and RISK (diversification) if one industry does not do well
CUEGIS COCA COLA

Change- Any alteration in the external environment forcing the company to

modify its products and services

Strategy- Long term plane

Point- companies use market penetration as a growth strategy. They tend to
reduce price and packaging.
In india 5rs bottle rural market: developing country- reduce price-late 90’s to
early 2000’s

Low risk- product is same economies of scale to overcome competition

Packaging cost- promotional cost, competition, price war

Consumer-rural
Competitor-pepsi
Brand endorsement -celebrity