Exam 1
Question 1
Strategic management for Zebra Corporation also involves the global strategy. Global strategic management for the company would involve standardization of goods, integration of goods, and configuration dimension. In standardization, the company would be seeking to determine the extent in which it needs to standardize its goods across countries. In integration, the company would be determining the extent in which it integrates its competitiveness across countries while in configuration dimension the firm would be determining the extent in which its goods are concentrated within one location across all countries . There are advantages for the company to standardize its goods in Russia. Standardization entails offering standard laser printers for personal computers across Russia .
Absolute standardization is may not be entirely necessary across all nations especially if all the core elements of the laser printers are applied consistently within the country. The laser printers have to be integrated with the minor adaptations to Russian specialties and peculiarities . Since the company sells products that are based on technological advancement, it managerial practices, customer taste and products are basically converging across nations. When the global market converges, there is room for standardized products to be sold across countries including Russia . This helps in minimization of the need of additional costs and complexities for adapting the laser printers to the local Russian market. Standardization simply helps to achieve high performance of the laser printers across countries .
Product standardization will help the company save on cost when it comes to research and development . The company will also save on the cost for marketing and production. With regards to research and development (R&D), Zebra Corporation can focus its financial resources on just the standardized laser printer without having to think about adapting the printers to the taste of the local Russian market and to the Russian culture . The company will therefore have smooth operation in the Russian market without incurring high costs. With regards to production and marketing, the focus for the company will be the same. They will only emphasize on production and marketing of only one product, the standardized laser printers . Standardization will also apply in marketing approaches such as packaging, and branding; implying that the company will not have to use extra money to package and brand the product differently. The effect of globalization is increasing the need for standardized goods across countries. Globalization has created homogeneity in consumption of goods and services . Therefore, the company would not have to adapt the products to the peculiarities of the Russian local market .
Product adaptation and product standardization are different concepts in global strategy. The former implies that the company adapts the laser printer in the local Russian market . The laser printers will generally be design to suit the Russian market. Generally, laser printers are made from standard parts. However, when sold internationally, some modifications are made to adapt the product’s power supply (e.g., voltage requirements and shape of the plug for electrical outlets) and internal software to suit specific language requirements. The need for product adaptation in this case is mainly characterized by regulatory and legislative forces in both the US and Russia .
Sometimes the need can be characterized by uncontrollable forces in the market place. For instance, in Russia, the voltage requirement is different from that in the US. Therefore, the company has to adapt its products to this regulatory and uncontrollable market force . The company will have to adapt its products as well as marketing approaches such as distribution, promotion, positioning, packaging, and pricing .
Adaptation also has advantages. If Zebra Corporation decides to adapt the laser printers to the taste the local Russian market, they are making the product to suit to the needs of the Russians . In addition, the product will take into the cultural taste of the country. Product adaptation therefore helps the company to develop awareness of Russian culture and taste of the laser printers. With this knowledge in mind, the company can easily make the printers to suit the needs of the local market . Product adaption of the laser printers is essential if the company intends to consumer value based products. The consumer value based products focus entirely on the consumer and giving them a value for their money. Value revolves around moral standards and economic returns . It would be unhelpful if the company decides to sell its product in the Russian market while the consumers are not able to use the products. The specific properties of the laser printers are regarded as the indicators for value creation to the consumers .
Language and culture affect the product adaptation. . Language is said to have a dual character. It is both a carrier of culture and a means of communication. It is unthinkable to have language without culture and similarly culture without language . The relation between language and culture is described to be mutual whereby each is part of the other. This implies that the two are interwoven and they cannot be separated. If in case they are separated, the significance of the other is lost. Russia as a country does not use English language as its official language. The company will be required to adapt the printers to the Russian language and culture .
The other factor that affects product adaptation is changes in the economic climate. Economic matters in Russia can be out of the control of the company thus necessitating for product adaptation . Problem in the Russian economy can lead to a reduction in sales. It can lead to the company being forced to consider using expensive materials for the production of the laser printers or even forcing the company to redesign the entire product to make it easily affordable to the customers
If the management of the company is concerned that its pricing might be too high, given the lower income level of typical Russian consumers, there are steps that it can take to reduce the pricing of its products to remedy the situation.
Question 4
There is no doubt that undertaking a market assessment opportunity is a fundamental factor for Levi Strauss given that it intends to evaluate and examine its trading position as it plans to enter a new market. In this instance, global opportunities available to Levi Strauss entail the chances that it can use to transform into profitable and productive activities. Such activities include but are not limited to the evaluation of investment opportunities, identification of merger/acquisition opportunities, and as delegating some of its services to a foreign market. Often, a new market presents a myriad of opportunities are available for any international company willing to undertake business ventures . Depending on the availability of different modes of entry and the level of involved risks, a venturing company must make careful and informed decisions. For instance, utilization of existing resources and economies of scale can be capitalized upon by entering into joint ventures with foreign partners. This move can also enable the venturing company to gain easier access to the already established domestic markets. Another easier mode of entry entails making foreign direct investment in foreign markets through the establishment of facilities such as production and processing plants, and in turn creating employment opportunities for the locals .
For Levi Strauss’s desire to assess the available opportunities in the global market, several key issues needs to be assessed and analyzed. Levi Strauss is one of the largest manufacturers of trousers especially denim trousers. Being in the apparel and fashion industry, the company will have to realize the disparities of taste in fashion with different countries. Product adaptation is therefore an important consideration for the company as it has to make products that suits the culture and needs of a target group within different countries.
There are steps that the company needs to undertake in order to conduct the assessment. The first important consideration is to assess the internal environment within the company. Before it ventures out to a foreign market, the company has to assess its readiness for an international move. In order to assess the internal environment of the company, strategic tools of business analysis can be employed. The company will be required to establish its strengths and weaknesses, assess its financial readiness for the entry into a new market, assessing the resources required for the venture, and determine the readiness of the employees and the management team. The company will have to establish the skills required to begin operations in a foreign market. This specifically relates to the management. For instance, depending on the magnitude of the move, there will be need for identify the people to manage its operations within the foreign market. The management has to be motivated and committed for the venture.
The second step in the global market assessment is to establish the goals for the international venture. Beginning business in a foreign market may be created by the need of following a target group of key customers, the need to increase profit and sales. The strategic goals of the company can be checked to evaluate whether they are in line with the move to begin operations in a foreign market. After which, the company will analyze the sustainability of its products within the foreign market. For instance, if the company fails to adapt its products to the taste and culture of a country, the products may not be sustainable. Muslim countries forbid their women from wearing tight trousers. This is an important thing to note when the company begins operation in a Muslim country. At the same time, Japanese generally have a small body, thus necessitating the company to make tight jeans. All the factors that may hinder the product from making significant sales within the different foreign markets have to be taken into account. The consumption behavior of a target group within the foreign market has to be assessed . The mandated regulations of the government have also to be assessed.
Screening of the countries to begin operations is the third step. All the countries with potential target market have to be reduced to a manageable number. Factors to be considered in this step include the growth rate of a market, and the size of the foreign market. Companies want to venture into markets that show a lot of potential. Prahald (2010) says at the bottom of the pyramid is where there is a lot of potential for growth. Markets in developing countries may not be desirably large but they are Prahalad argues that they show a lot of potential for growth. By selling adaptable goods, the company will be able to build considerable economies of scale in terms of sales of the good. The company can have an advantage over its competitors by maintaining a certain price range for its goods. The global strategy for product adaptation will assist the company to be flexible enough to respond in good time to the needs of the local Russian market.
Prahalad, C. (2010). The fortune at the bottom of the pyramid: eradicating poverty through profits. Chicago: Pearson.
Yip, G., & Hult, T. (2002). Total Global Strategy. Prentice Hall.
