Questions: Multinational, Global And Transnational Strategy

8. What is diversification and why do organisations diversify? Recommend two (2) possible ways that this organisation can diversify, if they choose to

We already heard the sentence “Don’t put all your eggs in one basket” (Solovic, 2014) meaning in business perspective is of that practice of your business in another new industry apart from core business. Don’t concentrate always in one thing which is old and usual that we are doing from long time so if we can take some risk to do something new it will help to business growth and we can launch new product or service as well. This can be seen as a branching out into the new business opportunities (Ashe-Edmunds, 2015). According to David (Allen & Gorgeon, 2007) it relates to the risk but when we see it in strategic point of view it consider as a doing something new. Meaning

Provide a brief synopsis of the following: multinational, international, global and transnational strategies.

1. Multinational

Multinational means facility or service or assets in different country other than home country. Many companies like Nike, Cocacola, BMW have the office in many countries as from that they get many customers, technology and make development of the service. It helps to create the job as well.

Multinational strategy is to improve the efficiency in location and product as different place which have same resource but get benefits of lowest cost in production of same product. As for example the production of toys involved excessive labour cost so its good that if production will be done in which country where labour cost is low. That’s what wal mart is doing (Diaconu, 2012).

2. International strategy

International strategy is transferring the activities or service. Means for final good have to do much process on it. Just like import and export of goods means there is no any investment outside the home country. Technology or product may be generated in home country than send to the demanded market.

3. Global