we discussed how several companies such as Ford (Learning from Mistakes opening incident) and Coca-Cola (Strategy Spotlight 7.4) adopted a localized international strategy.
Interview a manager in an organization with foreign market exposure and ask the following questions:
(1) what are the main benefits of localizing products or services in your industry?,
(2) how do you manage the resulting complexity of localizing products or services?
(3) do you find it necessary to localize other value chain activities (such as HR management)?
Then ask yourself this question: Do the responses indicate that the organization is guided by established industry best practices or systematic strategic analysis of the internal and external environment?
Question 1: What are the main benefits of localizing products or services in your industry?
Question 2: How do you manage the resulting complexity of localizing products or services?
Managing the complexity of localizing products or services can be challenging, but it is essential for success in foreign markets. Here are a few tips:
Question 3: Do you find it necessary to localize other value chain activities (such as HR management)?
Yes, I do find it necessary to localize other value chain activities (such as HR management) in order to be successful in foreign markets. For example, it is important to localize the compensation and benefits package to reflect the local cost of living. It is also important to localize the training and development programs to ensure that employees are equipped with the skills they need to succeed in the local market.
In addition to HR management, there are other value chain activities that may need to be localized in order to be successful in foreign markets. These activities may include marketing, sales, customer service, and manufacturing. The specific activities that need to be localized will vary depending on the industry and the target market.
By localizing its value chain activities, a company can show that it is committed to the local market and that it understands the local culture. This can lead to increased sales, market share, and customer satisfaction.