What are the main strengths and weaknesses of each of the co

What are the main strengths and weaknesses of each of the competitive strategies: home replication, multi-domestic, regional, global, and transnational? Under what circumstances might each strategy be more or less appropriate?

Solution

1) Low production cost initially due to home grown manufacturing/centralization.

2) No need for manufacturing in other country

3) Homogenity in work force resulting in better co-ordination

1) Alienation of foreign customers & their demands

2) No foreign labour paticipation

1) Foreign work force participation increases

2) Products are made according to local demand & varieties

3) Marketing & manufacturing according to market

1) Cost increases due to decentralization

2) Variuos language,culture,trade barriers

1) More decentralized than multi-domestic helps in increasing customer demands

2) Firm able to charge premium for the product

3) Better suited in dynamic environment

1) More cost outlays due to more decentraliation

2) cost & complexity of nation taxes effects more

1) less expenditure due to standardization

2) Efficient logistics & distribution capability

1) may not satisfy all markets

2) risk of centralized production if any problem face

1) More cooperation & interdependence between Corporate & subsidiary office

2) Part Global & part regional strategy helps in maintaning its core values while pursuing local markets

1) vey difficult to balance between local & global activities

2) very complicated

In a nutshell:

1) Use Home replication during initial export of products or having same culture

2) Use multi-domestic when flexible heterogeneous markets encountered

3) Use regional when rigid heterogeneous markets encountered

4) Use global when major amount of homogenity is acceptable

5) Use transnational wheretradeoffs are to be made between cost effectiveness & local adaptation.