Business strategies - Essay Example

Please do not write about SABMiller and Avon, McDonalds and Subway, Wal-Mart and Starbucks, Coca Cola and sony, Dell Part Please write a small answer getting straight to the point. write it in discussion formatThrough reading of the business press, identify a firm implementing the global strategy and one implementing the multidomestic strategy. What organizational structure is being used in each firm? Are these structures allowing each firm’s strategy to be implemented successfully? Why or why not?

  Please be specific.Also, please attach a link to the article(s) that you referenced in your research.Answer:A successful global firm is Louis Vuitton Moet Hennessy (LVMH). The company produces standardized products with the distinctive Louis Vuitton design. Its organizational structure is flat and multidivisional according to class of products and brands, and its manufacturing operations for bags and apparel are outsourced (LVMH Annual Report). This is not successful in controlling these luxury goods, so there are many fake “LVMH” being sold in unauthorized outlets such as in Asia.

http://www.lvmh.com/comfi/pdf/LVMH_RA_2010_GB.pdfThe multidomestic firm is the Hong Kong Shanghai Bank (HSBC). While the banking functions are the same, what is different is the service in each place (the bank has a service product) which assumes the customs of the place. HSBC is called “the world’s local bank”. HSBC offshore banks are multidivisional and organized around geographical region or country area – that is, they have a degree of autonomy within their host country, in order to facilitate compliance with local regulations.

HSBC Annual Report 2010:http://www.hsbc.com/1/2/investor-relationsPart #2Write a small response to these 3 people comments Person #1 SABMiller owns several premium international beers, six of which are among the worlds top 50 beers.  It uses the multidomestic strategy to expand its growth, profitability and product offerings.  It uses a multidivisional organization structure with regional and divisional headquarters through different geographical locations.Avon previously uses the multidomestic strategy but changed to a global strategy when much of its sales was declining.

  The analysis of its various products is done in the companys New York headquarters.  It uses this strategy to control costs and gain additional economies of scale to improve performance.  A functional organization structure is used at the company.Answer :The global strategy is apparent in SABMiller’s standardized products, namely their own portfolio of international premium beer brands. The global strategy is important to maintain brand exclusivity, while the multidivisional structure according to geography allows for efficient distribution to international markets.

Avon also uses the global strategy and functional organization; it abolished its three international regional headquarters and instead established nine streamlined business centers in charge of sales, marketing and distribution worldwide. The managers of the nine functional units report directly to the Office of the Chairman, so the structure is horizontal.Person #2 I think McDonalds uses a multidomestic strategy and Subway uses the global strategy which I have experience them both in different parts of the world.

 McDonalds has offered different products to other parts of the world. McDonalds is known for its Big Mac and nuggets and these are being sold at most locations but I notice the breakfast menu to be different in different. When I was in Canada toast was on the menu; I am not sure about other parts of the United States but the many McDonalds locations by me do not offer toast. Subway uses a global strategy; for the most part every sandwich in the United States is available in Mexico. All the combination of toping and meats was available in Mexico as well as it is here.

 I do not think Subway is trying to make its stores localized like McDonalds but they are both very successful and have locations all over the world. Answer :McDonald’s is truly multidomestic as it allows its stores to adapt their menu offerings in host countries to the local taste and culture. Subway does not do this and offers basically the same standard sandwiches, with slight adjustments depending on the local availability of ingredients. Subway has just exceeded McDonald’s in number of stores worldwide, although McDonald’s sales volume still exceeds Subway’s worldwide.

Person #3 Coca cola implement in multi-domestic strategy because they have different flavors in different countries. The company uses leadership culture in their everyday activity. Their leadership behavior is suppose to engender organizational trust and commitment towards their vision, support and challenge. Coca cola’s leadership style was good in teamwork but their leadership style lack shared vision of leadership and cohesion in the executive team. To respond to that, the executive team re-examined the company’s leadership, culture and work processes.

Leadership team meeting, topic centered workshops, individual coaching, upward feedback and applied learning projects were advised. Sony is an example of a firm that implement global strategy. Their products are the same every where for different people. Professional Solutions Europe is sony’s most profitable electronic division in Europe. The firm uses acquisition to achieve revenue demands. Ernst Young’s corporate M&A team suggests that, PSE growth would also come from prioritizing business segments, chasing higher market share, devising new business models and revising internal structure.

In this sense, acquisition is not enough to be successfuAnswer:Coca Cola classic is the principal product of the company and it has the same formulation world wide; in fact, this formula is a tightly guarded secret known only to two men in the whole company. Thus, the formulation of the concentrate is prepared only in central headquarters then shipped internationally. It is only recombined with water and bottled in the localities.Sony’s is indeed a global strategic firm because all its products and supporting software are standardized.

For the hardware, this is because the R&D that goes into developing the product is substantial. However, unlike Apple which allows independent software developers to provide their own applications, Sony electronic products (i.e. playstation) run only on company developed software and programs. This is a slow process and the resulting product is usually more expensive.