How businesses and managers might adjust their corporate strategies to become more successful

Adjustment of Corporate Strategies of Success
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Executive Summary
Today’s business environment is characterized by the internationalization of companies due to globalization. With operations distributed in different countries around the world, organizations and managers face the challenge of finding the best strategies to attain competitive advantage. As shown in this paper, four strategies that can be applied by a business with international operations include global, multi-domestic, transnational, and international. This paper begins by giving a literature review of how organizations approach international operations based on Michael Porters’ configuration and coordination dimensions. The paper goes on to place the topic in the international business context by noting that optimal configuration and coordination of value chain activities are integral for success in the global market. The paper also examines how international firms such as Carrefour and Volvo approach the global market. The paper concludes by recognizing the challenge organizations and managers face and offers two recommendations that can help them adjust their corporate strategies to be more successful.
Literature Review
A key unresolved issue in international business according to Hoon and Rugman (2012) is whether firms should pursue a regional or global strategy. Pursuing a global strategy, in this case, means applying the strategy used in the domestic country to the global context. Regional strategy means that assets are distributed within each of broad geographical region (Hoon & Rugman, 2012). The authors point out that configuration indicates how a firm locates its plants and resources in the value chain. Hernández and Pedersen (2017) note that in order to build an overview of the configuration of the global value chain, it is important to evaluate the activities involved. Therefore, primary activities such as outbound logistics, operations, inbound logistics, and marketing as well as secondary activities such as human resources, research and developmet (R&D), and finance have to be examined (Fearne, Martinez, & Dent, 2012).
According to Schmid, Grosche, and Mayrhofer (2016), firms operating in the international market environment have to choose how far they will concentrate and centralize their activities. For each of the activity that makes up the value chain, an organization must make sure that they are coordinated appropriately across the borders. The article by Hernández and Pedersen (2017) explores other important activities that organizations and managers have to take into consideration: essential activities, core activities, upstream activities, middle-end activities, and downstream activities. Coordination in an organization aims to locate each of the value chain activities where conditions are best for the highest possible level of efficiency (Vahlne, Ivarsson, & Johanson, 2011). The authors note that the resulting configuration determines the processes that need to be coordinated. In this sense, an important goal when coordinating two organizational units is to create a fit such that better joint productivity is attained (Vahlne, Ivarsson, & Johanson, 2011). The four strategies that businesses can use in the international market environment according to Segal‐Horn (2015) include multi-domestic, global, international, and transnational.
Managers in the international business environment are “fine slicing” their activities and each part of an activity is being located optimally in the supply chain (Buckley, 2011). Therefore, essential and advanced activities such as product development, research, and design, which were previously considered core, are being offshored (Linares-Navarro, Pedersen, & Pla-Barber, 2014). When activities are globally dispersed, managers need to consider how their firms may have to adapt to local conditions while at the same time focusing on exploiting economies of scale (Hernández & Pedersen, 2017). In the configuration of a global value chain, a firm may have to manage heterogeneous cultures, languages, and legislations, meaning a greater level of control and monitoring may be required.
Context of the Topic in International Business
In today’s globalized business environment, businesses and managers have to deal with complexities that come with having operations in many markets around the world. As the world becomes more globalized, the number of firms expanding to newer markets rise, increasing further the complexity of having international business operations. Managers and business organizations have to configure their activities at optimal locations to enhance their competitive capabilities. Therefore, an understanding of how to configure and coordinate important organizational activities is integral to the success of firms in international business.
As informed by Vahlne, Ivarsson, and Johanson (2011), it is important for a firm to be able to simultaneously make adjustments to meet local conditions while being effective and efficient at the international level. The optimal level or configuration and coordination cannot be attained quickly by an organization. A firm operating in the global business environment has to go through the cumbersome process of adjustment and readjustment to increase its efficiency. Therefore, it is vital for managers and businesses to understand their value chain activities and potential ways of configuring and coordin...