International Business: Global Standards Strategy

International Business Name Institution International Business Question 2: In this age of globalization, some gurus argue that all industries are becoming global and that all firms need to adopt a global standards strategy. Do you agree? Why or why not? Illustrate your points with relevant examples. In the current world of business, globalization has become a common trend. Industries are increasingly going global with the main aim of benefitting from the many advantages associated with globalization. These include enjoying free trade, availability of labor among many others. The prevalence of this trend has led to a growing debate on whether or not business firms need to adopt a global standards strategy. Generally, all factors are in support of the idea that the firms should adopt global standards strategy. This view is because of the efficiency to the industry when carrying out its operations. In addition, the product life span will be prolonged with the adoption of the global strategy, which will give the firm a competitive advantage over others. Furthermore, this will lead to heightened customer awareness and satisfaction, improved effectiveness of the products and services provide access to new markets as well as ensure cost reduction and savings. For all these reasons, there is indeed a growing need for the global standard strategy to be adopted by all firms in this age of globalization. Concerning efficiency, the economies of scale of a company are leveraged through the global strategy. O’Farrell (2018) notes that: with an access to a wider market, a company’s product can be sold all over the world. In the same way, obtaining raw materials for such a company becomes easier since they can be bought in bulk and due to this, a company may save a lot. The costs in other areas can be reduced too such as in labor, packaging, and even the cost of marketing material. A firm can have access to new markets through the adoption of the global standard strategy. With this access, much can be enjoyed in terms of reduced costs due to the standardization in some of the markets. A company like Coca-Cola is one that has previously enjoyed the benefits associated with cross-border sales at a time when the US market was becoming saturated with its products. As a result of taking its products to outside markets, the company was still able to record a sizeable profit from the same. It is for this reason that firms need to adopt a global standards strategy. All firms need to adopt a global standards strategy because it increases the life span of a product. Concerning this, some company products may become obsolete in one market but they can still be successfully marketed in other markets (Lorette 2018). This ensures continuity of the life cycle of a product in a way that enables the company to produce even more newer and latest versions of a product because of a ready market. Examples of companies that could benefit from this are the Coca-Cola Company and Apple Company given that their products are the same all over the world. In this case, when Apple wishes to launch a new model of one of its products, it can take care of the old unsold stock by selling the same to those markets that are less developed. In doing this, it has to be ensured tha...