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Multiple-business corporations – Essay Sample

Multiple-business corporations – Essay Sample

Multi-national Companies often embrace a number of diverse operating Companies. Coca Cola is an example of an established brand and sells its beverage world-wide.  The strategy of Coca Cola has been with developing different bottling contracts and diversity of its operations in different countries.  They have not focused upon a single strategy for the development of global markets but more look at each country and their individual requirements and adjusted accordingly “the Company well today as people seek brands that honour local identity and the distinctiveness of local markets” (Coca Cola Corporation, 2009).  Where the multi-national has subsidiary companies like that of Pepsi Cola for example, it is often appropriate to let them have a degree of self-autonomy in the setting of their own business strategy.  This however has to broadly fall within the overarching strategy of the holding Company.  The idea is to let the subsidiary leverage off the benefits of the multi-national in terms of economies of scale and resources.

It is very difficult within the concept of globalization for a multi-national company to adopt a uniform strategy that meets the business requirements of all the different countries that it is operating in.  There are far too many variables involved that consider such items as ethnic diversity, religion, cultural considerations, politics etc. “while basic human needs may be similar everywhere, differences in cultural and other environmental factors significantly influence the buying behavior of people in different countries.” (Lemak David J, 1997).

In strategic planning the multi-national has to consider many ethical dimensions that may ultimately impact the brand image.  For example if using local business operations be aware of the international implications “Several U.S. companies such as Walmart and Nike offer products assembled from abroad” (Capozzi, 2010). Niki got themselves embroiled in a human rights scandal for using children in the manufacture of their product abroad and this focused upon child exploitation and slave labour.  The central management team was not fully aware of the local activities and suddenly this got world attention through the media spotlight.  In addition many Companies that are using goods made in China and imported under their brand name in Europe and the America’s may suddenly find themselves with a quality issue.  This impacted Marks and Spencer in Europe where they had built a reputation on the quality hallmark of their clothing.  A switch in policy and strategic thinking failed to consider the impact on their customer base when quality took a dive as a result of cheap imported goods.  It took many years to recover a customer base that deserted them in droves through this one significant change in global marketing strategy.

 

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