The international environment is one that offers significant challenges to any business, especially with the prevalence of multinational corporations that now operate around the world. Across the world, the economic environment is constantly shifting, meaning that multinational companies derive significant benefit from increasing their representation and services within individual companies. …
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This helps to secure their place in the international market if the economy in some countries significantly decreases. In addition, the increase in role within individual countries helps to ensure the global awareness of the brand. This report considers the strategy initiated by the DHL Express division of Deutsche Post DHL (henceforth DHL) to increase its investment in the Saudi Arabia network, increasing the access to DHL services for its customers, as well as customer service and delivery fleets. As part of this strategy, DHL planned to invest in the opening of 15 new service points.
The Global Economy and International Business
DHL is a worldwide logistics company that works with individuals, small businesses and large businesses in order to provide effective logistics solutions for whatever their clients require. The company has a number of different divisions which focus on different sections of their business. These divisions include DHL Express (Deutsche Post DHL, 2011a), which is involved in the worldwide shipping of mail and packages within a limited time frame, DHL Forwarding and Freight, which is involved in the global transportation of merchandise and goods to their destinations, this division focuses on the shipping of large items or large amounts of items, particularly for businesses (Deutsche Post DHL, 2011c). . The other divisions that the company commands are DHL Supply Chain, which provides warehouse storage facilities as well as managed transport and finally DHL Mail, which is responsible for a wide range of services including global mail, the retail outlets for the company, press services and marketing . Multinational organisations are confronted with the decision to either focus on regional or on global expansion. Generally speaking, if a company expands at a regional level it loses some of its ground at the global level, and vice versa. Globalization has been shown to be a strong strategy for companies, allowing them to increase their competitiveness . DHL has players in both fields, with a strong international presence as well as strong roles in a number of different regions. The expansion within Saudi Arabia is being developed as part of a wider strategy for expansion into the Middle East, with the idea that Saudi Arabia could serve as a foothold and a strategic location. Data Country Trends DHL has operated within Saudi Arabia since 1976. In 2008, DHL Express initiated a strategy to significantly increase their network within the Saudi Arabian region. In order to do this a total of $26.6 million USD was invested into the network. This strategy served two purposes; the first was for the expansion within Saudi Arabia, to provide better service and products. The second purpose was to take advantage of the influential role that Saudi Arabia has on the economic development in the Middle East and create strong customer relations and brand recognition for future development . Population Trends Stakeholders in International Business Stakeholders in DHL include customers, employees, investors as well as a number of partner organizations. Other stakeholders include those who are involved in making policy, various environmental and social groups, as well as the general public. In the expansion into Saudi Arabia, the company must balance the needs of the different stakeholders. In order to do this, DHL works actively with different stakeholder groups to ensure that there are no problems. For example, they engage environmental groups to discuss the impact in which the company will have in their expansion and the way in which environmental impact can be reduced .
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