Companies develop global strategies to enhance efficiency, learning, and flexibility, but national differences in laws, customs, and employee benefits must be considered. Micro and macro factors influence strategy implementation, and a global strategy is necessary for effective competition on an international level.
Companies create and develop strategies so that operational efficiency can be gained and maintained. For those companies that operate or wish to operate on an international basis, a global strategy is usually developed and implemented. This type of strategy usually includes ways to address a company’s learning processes, its efficiency tactics, and its ability to be flexible. There are several factors that influence the creation and implementation of an overall strategy, which is used at both the micro and macro levels.
The purpose of a global strategy is to enhance a company’s efficiency, learning and flexibility capabilities, thereby enabling it to operate effectively on an international basis. Many companies find it difficult to address all three of these areas simultaneously, making it very important that this type of strategy is as detailed as possible. When a business cannot effectively address these areas, many times, it will find that it can only survive on a national level. When it comes to tackling learning processes, companies find it essential to create a global strategy that takes into account national differences.
Laws and customs, morals, values and ethics differ from country to country, which causes these factors to always influence a company’s overall strategy. Preferred employee benefits also impact the development of this type of strategy. Those employed in one geographic location will often prefer different benefits than those employed in another location. With so many factors influencing an overall strategy, it’s easy to see that developing one often requires a significant amount of time and a great deal of close attention to detail.
There are two basic levels of economics: micro and macro. A comprehensive strategy is implemented within both levels. When a company develops an overall strategy, there is no need to create one for both the micro and macro levels. The strategy it develops is simply influenced by factors and elements on both levels.
When strategy is implemented, micro-level factors influence how a company allocates its resources so that profit opportunities can be exploited outside of its domestic locations. Many times, deciding whether or not to trade with particular foreign countries is decided within the overall strategy of a company and this decision is also influenced by micro-level factors. A global strategy is influenced by macro-level factors such as taxes and tariffs imposed on a company by foreign countries.
There are many pressures placed on companies in the 21st century to develop a strategy that can be implemented on a global basis. Companies are able to provide better customer service when they employ a strategy that allows them to centralize the development and distribution of their products and/or services while operating globally. Regardless of the type of business that operates on an international basis, a global strategy is imperative for effective responses to global competitors and their operating tactics to be provided.
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