5
Consequences Of A Global Economy (cont.)
Meaning of these consequences for managers
opportunities are greater-movement toward free trade has opened up many formerly protected markets
the environment is more complex-challenge of doing business in countries with different cultures
have to coordinate globally dispersed operations
the environment is more competitive-must deal with cost-efficient overseas competitors in addition to domestic competition
an increasing number of medium-size and small firms also engage in international tradeGlobal Strategy
Pressures for global integration
universal needs-consumer tastes in different countries are similar with regard to certain types of products
create strong pressures for a global strategy
pressures to reduce costs-impetus for global integration of manufacturing
key international competitors located where factor costs are low
global strategic coordination-response to global competitive threats
centralize decisions regarding the competitive strategies of foreign subsidiaries