Archana Singh Presented By: CASE Select two large multinational enterprises, one consumer-oriented and one industrial.
One of the expansion goals is to build a knowledge and competency base related to the local market needs including identifying the institutional voids and the opportunity it offers to build and improve custom services in the long run.
Creating talent and cultivating the culture of innovation are top concerns for the company among other political, Global integration national responsiveness risks and government regulations.
Further, XBdi want its subsidiary units integrated into the overall corporate structure and each of these units to become a source of specialized units thus eliminating redundancies between subsidiary units.
The company was also looking to form strategic alliances with business partners in other emerging economies to capitalize on their knowledge of the institutional context and competition. The tremendous growth of certain economies in Asia and the opening of China to western business have created more opportunities for firms to establish overseas office.
Additionally, the emerging market offers testing ground for innovation as well. Business strategies are multifaceted, encompassing decisions as to which markets to compete in, how to position the company in each market, and which capabilities to develop and leverage. In addition, the strategic priorities can shift as companies attempt to respond to competitor initiatives or to seize new market opportunities.
As a result, strategy seldom offers clear distinction for development of stable information technology infrastructure and business process capabilities that are critical components of integration between different business units.
However, while formulating the best strategy for XBdi to implement on a global scale, it is important to define an operating model similar to defining the organization type e.
In my research, I found that the choice of operating model is the preliminary step in building a foundation for execution which enables rapid implementation of a range of strategic initiatives.
The four general types of operating models are: Coordination Model low standardization, high integration 2.
Diversification Model low standardization, low integration 3. Replication Model high standardization, low integration 4. Unification Model high standardization, high integration Source: Ross, Peter Weil, David C.
Robertson Companies adopt an operating model at an enterprise level may adopt different operating models at the division or business unit level. The questions identified below helps me design and architect the operating model for each of XBdi business units.
To what extent does the company benefit by having business units run their operations in the same way? Further, it is important to weigh each operating models pros and cons against the choice of Integration Responsiveness IR Framework strategy before we can settle on a particular operating model for a business unit.
However, addressing all three areas is difficult to achieve. In looking at Integration Responsiveness IR Framework and its four distinct business strategies, transnational strategy seems compelling and offers maximum flexibility although it is difficult to implement.
However, it is a well coordinated approach to internationalization in which the firm strives to be more responsive to local customer needs while retaining sufficient control of operations to ensure efficiency and learning.
The four strategies emerging from Integration Responsiveness Framework are: International Strategy also known as Home Replication Strategy 2. The International Strategy seems very appealing to me since it allows XBdi to view its subsidiary business units as secondary to its primary domestic business.
However, very soon, I have realized that this strategy is myopic about the big picture and does not impinge on the kind of competitive positioning the company would like to have in other geographic markets especially in the emerging markets like China, India and Indonesia.3) “National responsiveness” and “global integration” constitute the two fundamental factors of the economic (value created) and financial (value captured) performance of the MNC.
4) “National responsiveness” refers to how the MNC responds to the economic, political, and organisational forces. 3) “National responsiveness” and “global integration” constitute the two fundamental factors of the economic (value created) and financial (value captured) performance of the MNC.
4) “National responsiveness” is about how the MNC responds to the economic, political, and organisational. 3) “National responsiveness” and “global integration” constitute the two fundamental factors of the economic (value created) and financial (value captured) performance of the MNC.
4) “National responsiveness” refers to how the MNC responds to the economic, political, and organisational forces.
Global Integration are a specialist training and consulting organization working with the world’s leading companies to inspire and enable their people to succeed in increasingly connected, matrix, virtual and global organizations. Integration-Responsiveness Framework The Integration-Responsiveness Framework summarizes two basic strategic needs: To integrate value chain activities globally.
To create products and processes that are responsive to local market needs. National Responsiveness -Global integration- the production and distribution of products and services of a homogenous type and quality on a worldwide bases -National Responsiveness- the need to understand the different consumer tastes in segmented regional markets and respond.