Question

Do you believe that the strategy type you chose for the previous question is the optimal global strategy for HP to pursue? Why or why not? Use factual information to help justify your answer.

Previous question: You have learned from your training materials that the integration-responsiveness framework juxtaposes the opposing pressures for cost reductions and local responsiveness to derive four different strategies to gain and sustain competitive advantage when competing globally. Which of these four strategies has HP adopted?

Answer: international strategy

Answer 1

Incentives for using an International Strategy:

1. Increased Market size: Since the core of international strategy is to be not bound or limited by the geographical regions,it helps establish a global market strutue for the company and lead to vast variety of possible demographics which company can reach and serve through its products.
2. Return on Investment: Higher the market size higher will be the returns on the capital employed into these markets and posiblitiy to mine extra income by the company.
3. Economies of Scale, Scope and Learning:A global company when compared with domestic ones enjoys large scale in production and sale economies, while its scope is now diversified on a global level, new level of information and knowlegde becomes easily available for learning and further growth of both quality and the company itself.
4. Obtain resourses and cost redution:Apart from above mentioned points the most motivating factor for adopting international strategy is to identify cheaper markets\Technologies for production and outsorcing company operations, which will result in overall cost reduction of the company's manufatured.It also helps in accessing to new resources for company's growth and innovations.