Aspect of International Business Strategy

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Question :

This assessment will cover following questions:

  • Demonstrate the key issues involves in international business strategy and how it can be overcome.
  • Analyse the current and extant theories and concepts of strategy required for the development in the international environment.
  • How business strategies reflect changes in both the domestic and international business environment.


Answer :


International business strategy termed out as focussing on exportation of the products and services to abroad market and import good and resources from other countries for domestic use (Teagarden, Von Glinow and Mellahi, 2018). International business defined as business transaction that take place crosswise the national borders. In terms to spread out their customer base and to deal commodities in more international market, firm is following global plan of action purchase economies of scale to boost reach and profitability.

The present report is based on formulation of business strategies in response to challenges of internationalisation and how this affect the changes within the both domestic and international business environment.

Critical Analyse and Evaluate The Key Issues Within Global Business Plan of Action International Business Plan of Action-

International Business Strategy:

International plan of action termed out plan of action that created by a firm to do business within the global markets. One of the main key issues in international business strategy is strategic dilemma between local representatives and global integration specifically in terms of doing business in emerging markets (Castellani and et. al., 2018). It is a well- known fact that products and services sold by MNC varies in different world market. This variation is due to varying market demand. There are various kinds of examples that can be used to explain this issue in a detailed and specified manner. one of the case studies that can be used to explain this issue is Case of Spanish MNCs in Latin American Countries in which Spanish MNC was facing various kinds of issues in operating their business in different national context (Campos-García, Olivas-Luján and Zúñiga-Vicente, 2019). In order to resolve this issue, an international plan of action requires to undertake the depth analysis of global market, studying resources, defining the goals and to understand the dynamics of market and develop offerings (Teagarden, Von Glinow and Mellahi, 2018).

In addition to this, international business strategy is termed out as highly global integration that have the main objective is to reduce the cost as much as possible by creating the economies of scale through more standardised product offering in the worldwide. Due to enhancement in the globalisation in the past decades, the smaller firms have been able to conduct business with cross national boarders and also conduct the business at abroad level. Therefore, if firm adopts the international business than it can be possible to have continue growth within the market. In order to prepare the international business strategy the five step model needs to be followed and this is defined in below presented manner as are-

  • At the very initial and first stage the formation of international plan of action is to analyse the market and this will also inclusive of general micro-economic data, trading partners, balance of trade and per capita financial gain etc.
  • At the second level, the entity should take initiatives to determine the resource for its international enlargement. Henceforth, Greater net income, resources with higher competitive advancement must be superior.
  • At the third step within the international plan of action is to set out the global objectives. In order to set up the international business in effective manner there is need to undertake the market analysis effectively and efficiently (Aguilera, Henisz, and Shaver, 2019) .
  • In order to take entry in international market, the firm select path like propulsion of a brand new commodity or undertaking collectively another willing partner firm that has already present within market.
  • The final step within the international plan of action process is to bring out the development of service offer which can assist to embrace the details like pricing, commodity and distribution.

To understand the international business, this is crucial to have conceptualisation of understanding of why trade and investment takes place the across the national broader. This is termed out as to gain comparative advancement of nations. In contrary to Hamilton and Webster, (2018) stated that international strategy is termed out as worldwide plan that is specific to firm in which model for global enlargement and commercialism is one of the supreme goal. International plan of action is termed out as action that occurs across the multi-national corporation within the private sector. There are several international marketing plan of action that can be applied to the different world market and cultures.

In order to bring international market strategy , the global strategy can be defined as one of crucial part in international marketing as this can be appropriate with the strong pressure level for cost decrease and weak pressure for local responsiveness. It allows the enterprise to sell out the standardized commodities at the worldwide level. Global strategies highly require firm to tightly coordinate their commodities and pricing plan of action across the global market and locations (Hamilton and Webster, 2018). This is one of the effective way that aids to streamline the business functions effectively and efficiently.

The another strategy that can be useful is as individualized marketing strategy. This put consideration over target market in particular that definite quantity to get the extensive amount of research data (Cabral, Hékis and Sidrim, 2018). In order to keep the balance between the profit and cost caught up in that research the effective plan of action needs to be undertaken to carry out the things in effective and efficient manner. It is one of the effective way that helps to revise the version of commodity that is created to match the necessarily of all individual markets that helps to keeping the economic, political and social factor in notice.

The multi-domestic business strategy also termed out as establishing its presence in the abroad market and adapt its commodities and services to the local consumer base. Therefore, multi domestic business enterprise often support their enterprise headquarters in their country of origin but they usually set up abroad headquarters. In addition to this, Reuber, Knight and Zhou, (2018) stated that multi-domestic plan of action aim to meet the necessity and requirement of the local markets world-wide with help of customizing the trade of their commodities and services across-the-board. It is defined as plan of actions that change the commodities to local taste that offering contrary commodities within various market. For example- Nestle utilization of the unique marketing and sales formulation for each of market in which they operate their business functions. 

To Undertake Evaluation About The Issues in International Business Strategy-

Expansion of business at the overseas means to reach the new customers and also help potentially to boost the profits. This expansion of business is the main reason due to which strategic dilemma between local responsiveness and global integration issues occurs in international business strategies. Afterwards the all uncertainty of 2017, and the challenges that have yet to disclose all these things are impacting the growth of enterprise. Other than this there are various kinds of other issues that are associated with international business strategy inclusive of accounting practice, cultural issues, political risk and cultural issues. These issues mainly occur due to many reason some of them have been explained below:-

Globalisation Within Global Business Environment-

Globalization is termed out as increasing economical interdependency within the countries that is mirrored as accelerative the cross-border flows of three type of things such are as goods, services, capital and know-how. Therefore, the closer integrating of services of the countries and people of the world brought the tremendous diminution within the cost of production and communication. As per the view of Child and Lu, (2018) stated that globalisation is mainly divided within the globalisation of market and globalisation of commodities. Globalisation of the producing the commodities will continues to suffer from the things as cost of transportation, barriers of trade, social, economical and political risk that are impacting the growth of the enterprise in vital aspect. In contrary to Odiko, Ogutu and Omar, (2018) stated that globalisation has important effect on the business environment, this also prompt the evolution of multinational enterprise. Globalization has increased competition both at local and international level. Due to which conflict within strategic dilemma between local responsiveness and global integration occur which further makes it difficult for international organizations to adopt same strategy for doing business in different market places. As a result many MNC's bring variation within their product features, quality, prices as per the local market representatives and need of the market.

Strategic Choice For International Business-

Under the global plan of action of the framework the global business is not undertake as core interest of enterprise. Thus, entity needs to simply decides to opt for the go global and also sets up the global division that deals with the non domestic business. As per the view of Ardley and McIntosh, (2019) stated that at the time when internal business develops the firm may also decides to source some element from the globalised market and this also standardised some product and services. As the firm international presence enhances and multi domestic and localisation scheme develops. The plan of action the entity use to set the subsidiaries within the respective countries that tends to operate business activities severally from each other. It is the kind of the strategy that mainly put focus on local responsiveness and this is frequently achieved at the disbursal of cost and possible attribute.

Culture, Communication Difficulties and Cost of Undertaking Business Activities-

Culture is the elusive and this can have wide impact on the international business strategies as this differs everywhere. As per the view of Priem, Wenzel and Koch, (2018) stated that dimension of the culture impacts the work practices in different countries. Cultural deviation can also determinant the demand for the commodity and services within the market. Power distance, individualism vs collectivism, uncertainty avoidance and masculinity vs femininity, long vs short term orientation etc.

As per the view of Ardley and McIntosh, (2019) stated that national culture framework and large power can translate within the potential corruptive practices. Therefore, high power distance society people attend to view the immoral exercise as acceptable. In addition to it, uncertainness of the avoiding countries tends to have the legal framework and strict rules of doing the business. This highly impacts the operational performance of the enterprise. Therefore, the individualism vs collectivism termed out as crucial characteristic that highly influence the business cost (Teagarden, Von Glinow and Mellahi, 2018). Collective is connected with unethical behaviour and corruption. On the other hand, masculinity tends to highly influence the cost of the business. For example- If any counties has the high masculine cultures than this will be connect with the unethical business practices. In addition to this, feminine cultures also results in the higher secrecy and conservatism within the accounting and finance.

In contrary to Aguilera, Henisz, and Shaver, (2019) stated that religious belief has an essential impact on work practices of business. In the international business, the people come from the varied place and sometimes it becomes typical to cope with and it brings chaos. Thus, to get overcome with it the firm needs to adopt suitable strategy that can helps to bring effective and efficient business practices. Good communication can be termed out as the heart of internation business plan of action. Henceforth, the communication across cultures is defined as very challenging and this develops cross culture competence and communicating skills defined as centre focus.

Impact of Political Risk-

As per the view of Hamilton and Webster, (2018) stated that political challenges highly faced by the investor that results into legal action and sometime inactivity. Henceforth, political risk leads to have negative business consequences due to action of legal authorities and public sector enterprises. In many of the countries political situation are not favourable and this highly affects the working of the enterprise. Thus, political risk can also be translate with the change in tax barriers and this is the things that makes the firm more and less competitive globally. In addition to this, Reuber, Knight and Zhou, (2018) stated that intellectual property rights as political risk termed out as judicial framework that s different each country.

Therefore, political risk within the global business effect from the various components that highly affects the income of the firm and also complicates the business strategy of the enterprise. These can also include the issues of macroeconomic such as high interest rates and social issues. According to the view of Cabral, Hékis and Sidrim, (2018) stated that political risk for the international businesses inclusive of nationalisation and attack of the assets, act of terrorism and failure of local regime that enforce the contracts in the region. Thus, stable political condition helps to bring out the streamlined business functions.

Supply Chain Complexness and Risk of Labour Development-

From the overseas management of the suppliers and supply chain can be termed out as the difficult procedure. Unfortunately, the duration and supply chain enhance the chance of working with the suppliers that has immoral and ethical business practices. As per the view of Odiko, Ogutu and Omar, (2018) stated that to increase the consciousness and assist the local and international business react more efficaciously to this kind of issues. Thus, rates of the supply fluctuates and this makes harsh impact on the working policy of the enterprise.

Currency Rate-

Currency rate fluctuations is biggest challenge for operating the business activities at some other place. Monitoring the exchange is one of the significant strategy for the international businesses. As per the view of Child and Lu, (2018) stated that global economic excitableness can make prediction about the profit especially typical at the time when rates fluctuates at the unforeseeable levels. Thus, the major fluctuates can seriously effect business activities, expenses and profit. In addition to this, justify the risk for the unforeseeable monetary system rates can be setting up a progressive contract.

International Accounting-

The judicial areas that has to be focused when its about commuting the international business is known to be tax compliance. In addition to this, accounting is one challenge to the multinational business that are apt to pay the corporation tax at abroad. As per the view of Child and Lu, (2018) stated that Contrary tax systems, rates, agreement necessitate and this all can make the accounting function of the organisations importantly difficult. Therefore, accounting plan of action can be defined as key to maximise the profitability. With help of justify the risk of multiple layers of tax income makes the good business sense for the any enterprise that trading abroad. In contrary to Aguilera, Henisz, and Shaver, (2019) stated that the national account system principle desire to getting the respective economical condition of the country.

World Wide Environment Issue-

The risk relate with the environment impact of changes in climate that are the becoming one of the crucial term. Therefore, sustainability is one of the top agenda various global corporations. As per the view of Priem, Wenzel and Koch, (2018) stated that beyond ethical incentive becomes more Eco friendly, this establish environment conscious business practices that supports to attracts the consumers. Due to the world wide environmental issues the production technique may also led to impact the local legal authorities through waste and pollution.

Also read :- International Business and Risk Planing


Hereby, it can be concluded that international business strategy said to be as plan that guide the commercial transaction of varied organisation within different countries. In addition to this, global strategy of business termed out as plans and actions of private firms rather than legal regime whose main object is to as such increased profit by undertaking expansion.

The present report has covered the aspect of international business strategy. Therefore, study has also laid emphasises on challenges of internationalisation and this has also determined its affect that changes the both domestic and international business environment Working practices. To get more details about the online assignment help ask our experts.

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