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- 1. CASE STUDY ON GLOBALBUSINESS By Vijayalakshmi R
- 2. GLOBAL STRATEGY FOR BUSINESS Aglobal business strategy serves as a blueprint for organizations seeking to expand their operations beyond domestic borders. It encompasses a holistic approach that considers market dynamics, cultural nuances, and regulatory frameworks to formulate a plan that optimizes opportunities while mitigating risks in the global arena
- 3. TYPES OF GLOBALBUSINESS STRATEGIES GLOBAL STANDARDIZATION STRATEGY This strategy revolves around offering uniform products and services across diverse markets, with minimal customization to cater to local preferences. Embracing this approach enables companies to leverage economies of scale and maintain a consistent brand image. LOCALIZATION STRATEGY In contrast to standardization, localization involves tailoring products, services, and marketing strategies to align with the cultural sensitivities and preferences of specific markets. A study by Common Sense Advisory reveals that 56.2% of consumers prefer purchasing products in their native language, underscoring the importance of localization TRANSNATIONAL STRATEGY This strategy blends elements of both standardization and localization, aiming to strike a balance between global integration and local responsiveness
- 4. TYPES OF GLOBALBUSINESS STRATEGIES INTERNATIONAL STRATEGY Companies pursuing an international strategy operate in multiple countries with minimal customization. They often focus on exporting products or establishing a presence through partnerships or acquisitions GLOBALIZATION STRATEGY This strategy seeks to establish a cohesive global presence by integrating operations across various countries. Companies adopting this approach typically exhibit a centralized decision- making process and a strong corporate culture
- 5. THE BENEFITS OFA GLOBAL BUSINESS STRATEGY
- 6. Access to GlobalMarkets: Expansion into new markets reduces reliance on any single market, spreading risks across a broader geographical area. This helps mitigate the impact of economic downturns or geopolitical uncertainties Increased Revenue and Profitability: Global expansion can lead to higher sales and revenue streams. Internationally expanding companies are more likely to experience higher revenue growth compared to those focusing solely on domestic markets THE BENEFITS OF A GLOBAL BUSINESS STRATEGY Access to New Customers and Markets: A global strategy enables companies to reach new customers and tap into emerging markets with growing demand, driving sales and fueling business growth. Economies of Scale: Operating globally offers economies of scale, leading to lower production costs and higher profitability. This competitive pricing edge can bolster the market position Enhanced Brand Image and Reputation: International expansion can elevate a company's brand image and reputation, positioning it as a global industry player. This can attract top talent and forge strategic partnerships Innovation and Learning: Global expansion exposes companies to new ideas, technologies, and business practices, fostering innovation and driving continuous improvement
- 7. Market Research STEPS TO SUCCESSFUL GLOBALBUSINESS STRATEGY Target Audience Risk Assessment Conduct comprehensive market research to identify potential markets and assess their viability. This should include an analysis of market size, growth trends, competition, and regulatory environment Understand the needs and preferences of your target audience in different markets. This will help you tailor your products or services to meet their specific requirements Analyze your competitors in each market to identify their strengths and weaknesses. This will help you develop strategies to differentiate your offerings and gain a competitive edge Identify potential risks and challenges associated with expanding into new markets, such as political instability, currency fluctuations, or cultural differences. Develop strategies to mitigate these risks Competitive Analysis
- 8. Legal and Regulatory Compliance STEPS TOSUCCESSFUL GLOBAL BUSINESS STRATEGY Localization Human Resources Ensure compliance with local laws and regulations in each market. This may include obtaining permits, and licenses, or adhering to specific standards. Adapt your products, services, and marketing strategies to suit the cultural preferences and nuances of each market. This may involve translating your materials into local languages or customizing your offerings to meet local tastes Invest in technology and infrastructure to support your global operations. This may include setting up local offices, establishing distribution networks, or leveraging digital platforms for marketing and sales Build a diverse and talented team with experience in international markets. This will help you navigate the complexities of global business and drive success Technology and Infrastructure
- 9. Partnerships and Alliances STEPS TOSUCCESSFUL GLOBAL BUSINESS STRATEGY Measure and Adjust Establish strategic partnerships and alliances with local businesses or organizations to expand your reach and leverage their local expertise Continuously monitor and evaluate the performance of your global business strategy. Make adjustments as needed to ensure it remains relevant and effective in achieving your goals
- 10. Business-level strategy The Business-levelstrategy is what most people are familiar with and is about the question “How do we compete?”, “How do we gain (a sustainable) competitive advantage over rivals?”. In order to answer these questions it is important to first have a good understanding of a business and its external environment. At this level, we can use internal analysis frameworks like the Value Chain Analysis and the VRIO Model and external analysis frameworks like Porter’s Five Forces and PESTEL Analysis. When good strategic analysis has been done, top management can move on to strategy formulation by using frameworks as the Value Disciplines, Blue Ocean Strategy and Porter’s Generic Strategies. In the end, the business-level strategy is aimed at gaining a competitive advantage by offering true value for customers while being a unique and hard-to-imitate player within the competitive landscape. Three Levels of Strategy
- 11. Functional-level strategy Functional-level strategyis concerned with the question “How do we support the business-level strategy within functional departments, such as Marketing, HR, Production and R&D?”. These strategies are often aimed at improving the effectiveness of a company’s operations within departments. Within these department, workers often refer to their ‘Marketing Strategy’, ‘Human Resource Strategy’ or ‘R&D Strategy’. The goal is to align these strategies as much as possible with the greater business strategy. If the business strategy is for example aimed at offering products to students and young adults, the marketing department should target these people as accurately as possible through their marketing campaigns by choosing the right (social) media channels. Technically, these decisions are very operational in nature and are therefore NOT part of strategy. As a consequence, it is better to call them tactics instead of strategies
- 12. Corporate-level strategy At thecorporate level strategy however, management must not only consider how to gain a competitive advantage in each of the line of businesses the firm is operating in, but also which businesses they should be in in the first place. It is about selecting an optimal set of businesses and determining how they should be integrated into a corporate whole: a portfolio. Typically, major investment and divestment decisions are made at this level by top management. Mergers and Acquisitions (M&A) is also an important part of corporate strategy. This level of strategy is only necessary when the company operates in two or more business areas through different business units with different business-level strategies that need to be aligned to form an internally consistent corporate-level strategy. That is why corporate strategy is often not seen in small-medium enterprises (SME’s), but in multinational enterprises (MNE’s) or conglomerates
- 13. CASE STUDY OF COCA-COLA Fromits humble beginnings in 1886 at a local pharmacy in Atlanta, Coca- Cola has grown into one of the world's most recognizable brands and successful global businesses. The company now operates in over 200 countries and sells nearly 2 billion beverage servings every single day
- 14. Functional Strategy PoweringGlobal Growth A key driver of Coca-Cola's worldwide growth is its functional strategy involving strategic global partnerships. Rather than handle bottling and distribution entirely on its own, Coca-Cola adopted a unique franchising model early on. This involved partnering up with local bottling companies while focusing internally on brand building and product concentrate manufacturing. Such bottling partnerships gave Coca-Cola a highly asset-light and flexible structure, making rapid global expansion more feasible. Moreover, having strong regional bottling partners enabled the adaptation of products to local tastes and the gaining of deeper cultural insights. This win-win arrangement remains central to Coca-Cola's operations around the world even today. Other functional areas like marketing, innovation, analytics, and HR also now leverage an integrated "Networked Organization" structure. This facilitates collaboration and best practice sharing globally across business units and regions. Aligning all functions towards the overall corporate vision has been key.
- 15. Crafting a GlobalBrand and Marketing Machine Coca-Cola puts branding and marketing at the heart of its global business dominance. The company utilizes a "one brand, one visual identity" policy internationally to ensure universal recognition. Such standardization at scale brings unmatched mental recall globally, triggering impulse purchases by travelers and locals alike. Moreover, while maintaining a consistent identity, Coca-Cola's advertising is tailored to resonate culturally across diverse markets. Commercials tap into universal themes like family bonding and festive joy that transcend geographies. Even today, Coke allocates enormous budgets across TV, sports sponsorships, social media, and experiential events to craft captivating campaigns. Beyond promotion, the product portfolio itself has expanded greatly over the decades to include lower-calorie options like Diet Coke and Coke Zero. Category diversification moves into juices, coffee, energy drinks, and enhanced waters to cater to wider consumer needs. This multi-brand approach, combined with world-class marketing, has been a proven tactic in Coca-Cola's global success.
- 16. Strategic Innovation FocusAreas Innovation in flavors, packaging, processes, and business models also plays a key role in Coca-Cola's growth story. However, the company does not innovate randomly but with clear strategic intent after rigorous testing. Some focus areas driving innovation include healthier formulas, more sustainable packaging, premium/affordable pack formats for different consumer segments, and digitally-enabled equipment/experiences. Rather than purely novel ideas, Coke focuses innovation investment on scalable platforms with the highest ROI potential based on needs assessments. The goal is ultimately global replication of big wins, not just local trials. With such targeted innovation, Coca-Cola manages to consistently keep its product offerings relevant amid dynamically changing consumer preferences. This prevents lost market share to new beverage entrants.
- 17. Revenue Growth ManagementDriving Performance Apart from great branding and innovation, Coca-Cola also actively manages revenue growth opportunities through advanced analytics. Techniques like predictive modeling, geo- demographic segmentation, pricing elasticity analysis, and promotional optimization leverage data to maximize sales and profits. By determining the highest potential customer groups, retail channels, and portfolio/pricing mix for any given market, resources can be scientifically allocated for efficiency. Digital dashboards also enable tracking leading performance indicators and competitive benchmarking.
- 18. Revenue Growth ManagementDriving Performance Apart from great branding and innovation, Coca-Cola also actively manages revenue growth opportunities through advanced analytics. Techniques like predictive modeling, geo- demographic segmentation, pricing elasticity analysis, and promotional optimization leverage data to maximize sales and profits. By determining the highest potential customer groups, retail channels, and portfolio/pricing mix for any given market, resources can be scientifically allocated for efficiency. Digital dashboards also enable tracking leading performance indicators and competitive benchmarking.
- 19. GLOBAL EXPANSION Local BottlingPartnerships Instead of setting up capital-intensive owned plants, Coca-Cola's established global practice has been to partner up with local bottlers and distributors who already possess regional scale, logistics infrastructure, and route-to-market. Such affiliates understand nuances like consumer preferences, languages, business norms, and distribution intricacies better in their geographies. Tapping into these local insights via bottling partnerships instead of going solo proved a highly prudent and successful growth strategy for Coca-Cola in diverse markets like China, India, the Middle East, and Latin America. This asset-light franchise model provides flexibility to expand faster while also benefiting local partners through technology access and a lucrative alliance with an aspirational global brand like Coca-Cola. Both parties thus experience a win-win arrangement.
- 20. GLOBAL EXPANSION Product PortfolioLocalization While maintaining brand consistency across core trademarks like Coca-Cola, Sprite, and Fanta, the product formulations and packaging formats are tailored to align with local tastes and sensibilities. For instance, soy-milk-based variants were launched in Asian countries to cater to dietary preferences. Coca-Cola offers fruit juice blends in Europe, dairy-based fusions in Latin America, and lower-sweetness dry drinks in Japan based on regional taste inclinations. Moreover, pricing and pack sizes are strategically adapted to align with income pyramid dynamics in a market, thus improving product penetration and affordability. Such portfolio localization, while keeping core branding intact, has been vital for Coca-Cola's growth in international markets.
- 21. GLOBAL EXPANSION Mergers &Acquisitions Over the past decade, besides organic innovation, Coca-Cola has also accelerated growth by acquiring strong regional beverage brands across categories. Key acquisitions include Costa Coffee, an innocent smoothies brand, mineral water labels like Topo Chico, and the sports drink BodyArmor. Such tactical Mergers & Acquisitions instantly allow Coca-Cola access to new consumer segments, local distribution networks, and innovation capabilities already nurtured by the acquired brand. This faster route to enhancing market share has benefited Coke across Europe, North America, and premium beverage categories
- 22. GLOBAL EXPANSION Technology Transfers Tosupport hyper-growth in developing markets, Coca-Cola also actively enables technology transfers to impart world-class concentrate production and bottling know-how to regional partners. By providing proprietary food-grade chemical processes, quality protocols, supply chain best practices, and equipment capabilities to affiliates, Coca-Cola empowers consistent local manufacturing capacity across global geographies. This transfer of intellectual property and operational expertise establishes sustainable execution capabilities for both concentrate production and last-mile distribution across the company's worldwide bottling network - catalyzing wider reach
- 23. GLOBAL EXPANSION Inclusive DistributionNetwork The Coca-Cola system also focuses on developing inclusive distribution models to ensure availability across retail outlets catering to all income segments in a market. Beginning with niche high- margin stores, distribution gradually expanded across neighborhood grocers, small eateries, and roadside vendors, accessing mass consumer segments. This micro-market distribution strategy centered on establishing an omnipresent network rather than chasing volumes alone has been instrumental to Coke's exponential rise in Asian and Latin American emerging economies. By tailoring engagement across dimensions like partnerships, products, M&A, and knowledge sharing, Coca-Cola has devised a replicable expansion strategy template fueling worldwide growth. Blending global standards with regional adaptations allows for customizing Coca-Cola's solution for local relevance worldwide
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