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Critically discuss to what extent Porters Diamond is a useful concept in explaining home and host location strategies of international business Illustrate your answer with reference to at least two case companies - Essay Example

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The models can be used by firms that focus on internationalising and defining the best locations that provide opportunities for…
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Critically discuss to what extent Porters Diamond is a useful concept in explaining home and host location strategies of international business Illustrate your answer with reference to at least two case companies
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"Critically discuss to what extent Porters Diamond is a useful concept in explaining home and host location strategies of international business Illustrate your answer with reference to at least two case companies"

Download file to see previous pages As a model that explains why particular industries are competitive in particular locations, Diamond model looks at clusters, as well as a number of small businesses and other factors where the competitiveness of one firm is related to the performance of other entities locally or regionally. As a major tool that provides analysis for competitiveness, Diamond model incorporates four broad factors. This paper aims at determining the advantages and disadvantages of Diamond Model as a tool for explaining home and host location strategies of international business. The paper will focus on Marks & Spencer (M&S) and Carrefour, UK and France based organisations.
Porter’s Diamond model indicates that the competitive nature of nations is determined by the ability of the industry to upgrade its position and innovation. It indicates that the nation’s ability is also an influencing factor in providing a home base for firms to improve their services in terms of features, technology, and quality (Cavusgil et al, 2014). One of the advantages of the model is that it identifies 4 interrelated factors that create the important national environment where firms are initiated, develop and acquire sustainable competitive advantages. Through the use of Diamond framework, firms are able to undertake necessary research that is useful for internationalisation process.
The first factor includes factors of productions that entail land, capital, raw materials and infrastructure among others. In addition, it covers other infrastructures that are not inherited but are developed by a nation for instance skilled labor. Shiue et al (2006) argues that an organisation can achieve competitive advantage due to its ability to create the factors. For example, Carrefour Company, which was initially owned by the family decided to internalise in order to become competitive. This meant that Carrefour needed high amount of capital an aspect that made the company to go ...Download file to see next pagesRead More
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