A Localized or Multidomestic Strategy

question 37

Multiple Choice

A localized or multidomestic strategy

• A)is generally preferable to a global strategy in situations where buyers are price sensitive because a "think local,act local" type of multidomestic strategy is better suited to achieving low unit costs than a global strategy.
• B)involves much less adherence to using the same basic competitive strategy theme (low-cost,differentiation,best-cost,or focused)in all country markets.
• C)is generally best suited for globally standardized industries,in which small country-by-country differences can be accommodated.
• D)is generally inferior to a global strategy when it comes to pursuing product differentiation.
• E)has two big drawbacks: (1)it hinders the transfer of a company's competencies and resources across country boundaries because the strategies in different host countries can be grounded in varying competencies and capabilities,and (2)it does not promote building a single,unified competitive advantage,especially one based on low cost.

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Definitions:

Dynamic Environment

An environment that undergoes rapid and unpredictable changes, requiring organizations or individuals to adapt quickly.

Core Competencies

are the unique capabilities or advantages that give an organization a competitive edge in the market.

Network Structures

Describes organizational layouts where groups or individuals work independently but remain connected through technology, collaboration, and shared goals.

Functional Structures

Functional structures organize a company into departments based on specialized functions, such as marketing, finance, or production, facilitating specialization and operational efficiency.