Illustrates the appeal of Multi-national Diversification

Question

Illustrates the appeal of Multi-national Diversification?

Answer 1

The appeal of Multi-national Diversification:

More Opportunities for continued Growth and greatest Competitive benefit Potential: Despite their complexity, multi-national diversification strategies have huge plea. They hold two main avenues for growing profits and revenues: (i) to grow by entering added businesses and (ii) to grow by extending the operations of existing businesses into more country markets. A strategy of multi-national diversification holds six attractive lanes to competitive benefit, all of which can be followed simultaneously:

i. Full capture of experience and economies of scale and learning-curve effects.

ii. Opportunities to capitalize on cross-business economies of scope.

iii. Opportunities to transfer competitively important resources both from one country to another country and from one business to another.

iv. Ability to leverage use of a famous and competitively dominant brand name.

v. Ability to capitalize on opportunity for cross-country and cross-business collaboration and strategic coordination.

vi. Opportunities to use cross-country or cross-business subsidization to outcompete rivals.

KEY CONCEPT:

Transferring a dominant brand name from one product or business to another can frequently be done very economically.