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However, it poses certain challenges like; increasing cost structures, can turn out to be misguided, the necessary degree of local adaptation may shift over time as more and more global standardization emerges scenario.
Economies Of Scale
Spreading Fixed costs over larger volume Reducing capital and operating costs per unit Pooling global purchasing power over suppliers Creating Requisite critical mass in selected activities Major challenges being faced include; concentration in one location can have a number of drawbacks.
Economies Of Scope
Refers to multiplicity of regions and countries in which a country markets its products and services. Will be a source of competitive advantage if and the customers despite being global need the delivery of products and services across many markets. Competitive advantage lies in providing coordinated services to global customers and also more market power compared with the competitors through better understanding of its global customer. A mutilocation global vendor serving the need of a global customer can be challenging, conflict between the need for maintaining the centralized control over the product and service and yet the need for local autonomy in the actual delivery of products.
Designing an optimal architecture Building World Class Competencies Ensuring Frictionless Coordination
These organizations can have 4 Strategic orientations: International Strategic Orientation: Global Strategic Orientation Multinational Strategic Orientation The transnational strategic Orientation
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