Article On Global Strategy

Added on - 01 Mar 2020

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Running head: GLOBAL STRATEGYName of the Student:Name of the University:Author note:
1GLOBAL STRATEGYGlobal Strategy: An Organizing Frame Work, the author of this journal is SumantraGhoshal. The author in this article discusses about the global strategy which has been gainingimportance over the years. She has discussed a the importance of having a conceptual frameworkfor the Global strategy. The journal states that lack of having a conceptual framework has createdconfusion among the scholars, many articles have been published previously but none of thearticles succeeded in providing a clear idea about Global strategy. The author has discusseddifferent issues related to the global strategy. The different issues are strategic goals, managingrisks, national differences and how to use these differences for creating a global advantage,economies of scope and economies of scale are discussed in the journal (Ghoshal 1987).According to Sumantra (1987) many articles in the Harvard Business Review, Fortune,The Economist and other popular journals have been suggesting the Multinational Corporationsto take up the Global Strategies. The issue has grabbed the attention of the managers of theMultinational Companies. Many conferences have been conducted have attracted manycorporate. This conferences are conducted by the conference board in New York, The financialtimes in London and the Nomura Securities in Tokyo. Even the countries that are growing at aslower rate are using the global strategies. According to the writer global strategies are the mostimportant tool that is used in the International business in the present scenario (Ghoshal 1987).The global strategy is not clear to many and there are much confusion regarding theconcept global strategy. The writers in this field have not been successful in distinguishing theconcepts of global firm, global industry and global strategy. A global strategy is appropriate forglobal industries are, where firm's competitive stats in one national market is affected by itscompetitive status in any other countries’ market. This type of interactions between the variousmarket positions of the companies arises from the production benefits or it can arise from the
2GLOBAL STRATEGYjoint ventures or mergers or the sharing of the cost and the other resources in throughput themarket. This is not always true because it is opposed by .... Who believes that productionbenefits and the benefits from the mergers and joint ventures can be created and in many caseshas been created by strategic actions that are taken by the organization. In many industries theeconomies of scale are such as aeroframes or aeroengines, the economies of scale are very largemaking the need for global integration of activities very important. Many cases industries werenot initially global but are striving hard to make a position in the global market and some haveeven acquired that position. For example, Yosh~da Kagyo KK (YKK) or Procter and Gamble(Yip 2014).She further says that there is a difficulty that is faced by both practitioners andresearchers while coming across with the small but complex literary works on global strategies isthat there is no organizing framework so that the different opinions and prescriptions can beincorporated. The objectives of Corporations have many dimensions, and they many a timescontradict each other. On the other and it is often difficult to give priority to them. Actions takefor achieving a specific objective usually contradicts any other objective which might be equallysignificant . Every prescription aims at achieving certain objectives of a global strategy. Theframework is very useful for identifying the trade-offs between those objectives and hence ingetting a clear idea of not only the benefits but also the potential costs associated with thealternatives of the various strategies.The author further adds that, the core concept behind making the strategy is that, theactions taken as strategies must affect the other organizations. The firms that operate in imperfectmarket earn efficiency rents. Therefore the aim behind this strategy is to increase the efficiencyrents.
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