It indicates the strategic options for businesses wanting to manage their international operations based on two pressures: local responsiveness & global intergration.
global in the model
low pressure for local responsiveness, high pressure for global integration
transnational in the model
high pressure for local responsiveness, high pressure for global integration.
international in the model
low pressure for local responsiveness, low pressure for global integration.
multi-domestic in the model
high pressure for local responsiveness, low pressure for global integration
what is the force for local responsiveness
. do customers in each country expect the product to be adapted to meet local requirements.
. do local (domestic competitors) have an advantage based on their ability to be more responsive.
what is the force for global integration ?
. how important is standardisation of the product in order to operate efficiently (e.g economies of scale).
. is consistent global branding required in order to achieve international success?
global strategy: key features
. highly centralised
. focus on efficiency
. little sharing of expertise
. standardised products
Transnational strategy: key features
Complex o achieve
aims to maximise local responsiveness bust also gain benefits from global integration
wide sharing of expertise
international strategy
aims to achieve efficiency by focusing on domestic activities
international operations are largely managed centrally
relatively little adaption of product to local needs.
multi-domestic strategy: key features
aims to maximise benefits of meeting local market needs through extensive customisation.