Question

If your company produces a basic mobile phone with limited features and wants to compete internationally, which strategy would the company most likely employ a multidomestic strategy, a transnational strategy, or a global strategy?

Answer 1

A company producing a basic mobile phone with limited features and wanting to compete internationally would most likely employ a transnational strategy.

Step-by-step explanation:

A company that produces a basic mobile phone with limited features and wants to compete internationally would most likely employ a transnational strategy.

A transnational strategy combines elements of both a global and multi domestic strategy. It focuses on balancing global integration with local adaptation. In this case, the company would aim to leverage comparative advantages of different countries for different aspects of the production process, such as design, assembly, and component production. By doing so, the company can benefit from economies of scale, lower costs, and local market customization.

For example, Apple, a global company, designs and markets the iPhone in the United States (leveraging comparative advantage in design and marketing) and assembles it in China (leveraging comparative advantage in skilled labor force), while also sourcing components from Korea (leveraging comparative advantage in producing components).

Answer 2

A company producing a basic mobile phone would likely use a global strategy, focusing on uniform branding and production much like Apple's approach for the iPhone. This strategy leverages comparative advantages of different countries to minimize costs and sell competitively priced products globally.

Step-by-step explanation:

If a company produces a basic mobile phone with limited features and wants to compete internationally, the most suitable strategy would likely be a global strategy. This approach involves selling the same products in multiple countries with only minimal changes. Unlike a multidomestic strategy, which entails customizing products to meet local demands, or a transnational strategy, which tries to balance local responsiveness with global efficiency, a global strategy focuses on uniform branding and production to capitalize on economies of scale.

Taking Apple as an example, the company employs a global strategy for the iPhone. Apple leverages a comparative advantage, with design and engineering in the United States, components produced in Korea, and assembly in China, combining these strengths to create a product that is globally recognized and competitively priced. This strategy allows Apple to focus on innovation while benefiting from lower production costs, ultimately leading to products offered at lower prices to consumers worldwide.