A global firm can be an organization that has operations throughout geographies and where functions in one nation affects or has proper impact on the company or its operations in other areas.
There are several factors which have helped the emergance of global firms:
The falling of international trade barriers have got facilitated the emerging of global firms. It has made it less difficult and less costly to incorporate activities and coordinate resources across foreign borders. The falling with this barriers plus the globalization has also homogenized customers. In a globalized world global customers include similar requires and with the same product companies are able to reach all buyers in different markets.
The globalizazion has took place in the post industrial time. In this time there is furious competition among companies, in support of those companies able to decrease their cost have to be able to survive. A worldwide strategy enables firms to minimize costs by simply economes of scale or perhaps by having functions in third world countries.
A part frm the economies of scale, global firms can also be capable to lessen their costs by undertaking different parts of the significance chain in several places. This ability will certainly derive in cost decrease and stretegic advantage. An excellent00 world wide coordination of the source chain is needed. Tis is the reason00 IT and networking beeing core to successful global company functions today.
Global strategy as opposed to Multidomestic strategy
There are two different ways a good can way an international stretegy: Global Approach or Multidoemstic Stretegy.
Using a Multidomestic technique the control is generaly decentralized as well as the decision making is carried out on a local level. When a firm comes after a Global approach it will have a centralized control with small decision making specialist left in the local level.
Multidomestic firms come up with single-country strategies which concentrate strictly issues home-market while for global businesses the world can be described as...