In an overview of trade and production in the year 2008 (World Trade Centre, 2010), it was realized that developed economies achieved a low level of growth between 2000 and 2008. North America and Europe grew only by 1%. Developing economies on the other hand, expanded their output by 5. 6% in the same year. There has been a decline in world output and international trade for Britain, United States and Japan due to a weaker demand resulting from falling asset prices and increased economic uncertainity.
While the countries may be recuperating from recession, they are still likely to experience a smaller world output and international exports. WS4DQ2 In 1998 Wal-Mart expanded its operations to Germany and acquired 21 Wetkauf hypermarkets followed by a purchase of 74 stores of the Interspar hypermarket chain. Currently Wal-Mart operates 92 Supercenters in Deutschland, employing approximately 14,000 employees. Was this a multidomestic strategy, a global strategy, or an international strategy? Discuss Wal Mart provides the same line of products in each outlet regardless of its location.
It operates with a sense of consistency in what has turned out to be a global strategy. Its worldwide operations are standardized in a way that minimizes relative cost. In its approach, it views the different countries as one large market. WS5DQ1 Explain why an international firm would actively seek a strategic alliance with their suppliers. How does this approach differ from strategic flexibility? International firms have developed a tendency to work in collaboration with their suppliers with the motive of attaining mutual goals.
Most strategic alliances take the form of contractual agreements, equity investments or joint ventures. These alliances help to raise capital, minimize costs and increase the firm’s chances of survival during economic crises. Strategic flexibility on the other hand, is a company’s ability to recognize and make quick adjustments to changes in the external business environment. Such changes can involve commitment of resources to new projects or reversal of existing resource commitments in the event of change.
While strategic alliances involve collaborations for business survival, strategic flexibility is an internal process. WS5DQ2 Explain the relationship between consumer behavior in different countries and product attributes. Consumers purchase products based on their personal needs and product attributes. The knowledge and inferences consumers have about a product’s attributes and benefits can spring from personal assessment, advertising, self concept and the salience of such attributes.
Since people from different countries have various belief systems, it is obvious that their tastes and preferences also vary. It is these differences that influence consumer choices. WS6DQ1 Discuss the strategic value of personnel training and development. What are the implications for the MNC? Multinational companies experience great challenges in their efforts to stay ahead of competition. Innovation and reinvention have are proven to be the best methods of surviving in such competitive environment.
Rapid technological advancements now demand that companies constantly evaluate their market position and identify the talents, skills and knowledge they have in order to be successful. Strategic positioning of training and development promotes efficiency and effectiveness in companies. WS6DQ2 Describe what you believe to be best practices for recruiting, selecting, training, appraising, and rewarding employees in MNCs Multinational companies can optimize on the world’s potential workforce by embracing the best practices in recruitment, training, appraising and rewarding their employees.
The best way to achieve this goal is through recruitment by merit, employee motivation, training programs and regular performance appraisals. It is also important to avoid vices such as racism, tribalism, corruption and nepotism. Offering equal opportunities attracts the best skills and talents.
World Trade centre. (2010). WTO sees 9% global trade decline in 2009 as recession strikes. Retrieved August 6, 2010 from http://www. wto. org/english/news_e/pres09_e/pr554_e. htm