Study of the key aspects of successful corporate strategies for global expansion

Abstract

It is now 2015, and one can say that the world is truly integrated. With free movement of people, capital, information, ideas and knowledge, the world is now a single market, and it has become essential for multinational enterprises to recognize this and ensure that their strategy of internationalisation is one that would give them maximum success in all of the countries or geographies they choose to operate in. It is now an era where organizations are increasingly adopting various internationalization strategies, to ensure that they have a presence in multiple geographies, and are able to leverage their capabilities to compete effectively with the regional players, and ensure successful entry and sustenance in the foreign locations. Companies may adopt multiple strategies of internationalization, ranging from a centralized approach where the head office retains full control, and the scope and responsibilities of the foreign operations are often limited, to a very decentralized approach, where the foreign subsidiary is run as a completely independent entity taking its own decisions, within the broad mission and vision of the organization. Companies may adopt n number of strategies anywhere in this spectrum. Companies could have been successful in their internationalization strategies, with either of these approaches, depending on multiple other factors. Each of these strategies also have their own trade-offs. For example, significant centralization may result in loss of local responsiveness, and significant decentralization may result in inability of the foreign subsidiary to leverage the scale or economies of the global organization. We propose to study these factors that could result in successful internationalization strategies, and the trade-offs involved in adapting these strategies. We seek to understand these strategies and also other particular aspects of an organization, ranging from organization structure, culture etc. that could result in successful internationalization, from a theoretical point of view i.e. by review of academic literature. Using this theoretical understanding obtained, we propose to study a global company, and analyse its international strategy, the aspects of the strategy that resulted in a successful or failed international expansion, and whether these aspects correspond to the understanding obtained through the theoretical review of literature. Finally, based on our understanding and analysis, we will conclude by commenting on the key aspects that result in successful internationalization, and whether our analysis of a live company corresponds to this theory, and if not, the additional or different factors that we identified through the analysis.