Creating a Successful Global Business Strategy
Clarke Ricks
School of Business, Liberty University
BUSI 690: Policy and Strategy in Global Competition
Dr. Hicks
April 6, 2021
Creating a Successful Global Business Strategy
International business is a complex field where business managers are required to
coordinate input from multiple teams from several different locations around the world.
Although there is not a single universally accepted definition of a “global business
manager”, Christopher Bartlett, an authority in global business management, proposes one
of the most commonly adopted models. Bartlett’s model defends that there is “no such
thing” as a general, all-encompassing global business manager. Rather, Bartlett divided the
role of Global Manager into several distinct manager types that, together, compose the
global business management team.
According to Bartlett, business managers, country managers, and functional
managers provide the majority of the direction while senior executives coordinate the entire
management team. Together, these four types of managers overview strategy, country
profiling, local regulation, resource management, worker performance, and overall
production. Bartlett’s model of global management exposes the first challenge of global
management: a high level of coordination.
Another challenge of international business is balancing the market expectations of
multiple countries at once. Every national business operation needs to understand its
domestic demand for current and upcoming products. For each new country a business
enters, an additional set of demands and market conditions need to be considered,
increasing the complexity of managing the business at the global level.
Three Keys to a Winning Global Business Strategy
We can start seeing why operating in multiple national markets is a daunting task.
According to Professor Tomas Hult, Director of the International Business Center in the Eli
Broad College of Business at Michigan State University, there are three keys for a successful
global business strategy. The first key is to define the core business strategy for each
strategic business unit in a company.
The second key is to adapt the core business strategy to each national market, to
internationalize the core strategy. It is also important to take in consideration that the
internationalization process typically results in local business strategies with large
differences between countries. These differences affect the business’ cost position, product
quality and competitive differentials at the global level.
The third key to a successful global business strategy is to counteract the
weaknesses created by the internationalization of the core strategy by incorporating the
original unique characteristics of the business into each local national strategy. This process
can be called “globalization”. A global business should balance global consistency
(globalization) with local responsiveness (internationalization). While global consistency can
significantly increase leverage and competitive advantage for the firm at the global level,
local responsiveness (internationalization) can improve competitiveness at the local level.
Therefore, it is crucial to avoid “over globalizing” or “under globalizing”.
Benefits of a Successful Global Strategy
Although defining and implementing a winning global strategy can be a challenging
task, the benefits of a successful global business strategy clearly outweigh the effort. One
important benefit is cost reduction. A global business can assign different tasks to the
national teams that are the most efficient in accomplishing each task. If each team focuses
on the area for which it is most suited, overall efficiency rises and costs in terms of time are
reduced.
A second important benefit of implementing a successful global strategy is the
reduction of product development time. When a product is designed by several specialized
teams, each working at their maximum capacity, the overall time-to-market for a particular
product can be significantly reduced.
A third significant benefit is a creative input from different international teams.
Releasing a product into several different national markets without understanding the
culture and demand of each national market can lead to disappointing sales results. By
incorporating the input of international teams, a global product may be developed to fulfill
customer expectations in multiple countries.
Creating and executing a global business strategy may be an intricate enterprise,
but with the increasing payoff for companies expanding their business to international
markets, the effort can be worthwhile. A skilled global management team can effectively
coordinate the input from several different national teams which can result in significant
gains by successfully expanding the business to the global level.
A global standardization strategy refers to the ability to use standardized marketing
messaging and campaigns across markets, countries, and cultures. The world’s biggest
brands, such as Adidas and Coca-Cola, use a global standardization strategy to create a
consistent brand experience across regions and languages.
No matter where you visit those brands, the experience and imagery is virtually the
same.
In contrast to localization, where there's a more differentiated marketing approach
to each market, global standardization provides significant cost benefits as a result of less
messaging and fewer campaigns.
However, the key is in knowing when a global standardization strategy will be
effective. Because it banks on a universal appeal despite cultural or locational differences,
you'll need to research whether customers use or think about your products differently
depending on their market. If there's no difference between the usage and understanding
from country to country, a global standardization approach is practical.
Choosing localization or global standardization is one aspect of creating a great
global marketing strategy.
To give you an idea of what a great global marketing strategy looks like, we've
compiled a list of brands that totally "get it."
From adapting their social strategies to translate across multiple languages to
adjusting their menus to appeal to the cravings of a diverse group of people, these brands
are taking positive steps toward creating a solid presence across the globe.
So, if you're looking for inspiration on how to craft a successful international
marketing strategy and expand your business' reach, check out these examples from the
world’s most successful companies.
Austrian company Red Bull does such a great job with global marketing that many
Americans assume it’s a local brand. How?
One of its most successful tactics is to host extreme sports events all over the
world. From the Red Bull Indianapolis Grand Prix to the Red Bull Air Race in the United
Kingdom to the Red Bull Soapbox Race in Jordan, the brand's powerful event marketing
strategy takes them here, there, and everywhere.
Aside from events, Red Bull's packaging also plays a part in its global appeal.
"Red Bull really looks like a product from a global economy. It doesn't look like a
traditional American soft drink — it's not in a 12-ounce can, it's not sold in a bottle, and it
doesn't have script lettering like Pepsi or Coke. It looks European. That matters," explains
Harvard Business School professor Nancy F. Koehn. Though it's since diversified its product
selection since that article was published, the fact remains that Red Bull's consistent
packaging has helped this brand go global.
How to Imitate Red Bull’s Strategy
For smaller brands, reaching Red Bull’s level of international awareness might seem
out of reach, but you can imitate the brand’s strategy by offering one notable product — the
product you’ll most be known for. Then, be sure to keep the packaging the same no matter
where you distribute it.
