Global Strategy Assignment Sample
1.0 Introduction
Finding a prominent place in the international market is one of the biggest targets for private sector firms. Seeking homage in the international market not only helps the organization to stay stable in the market, provide a competitive advantage but also improve the quality of the work the firm deals with. Proper usage of trends taking place in the market can help the firm not only to improve its market portfolio but increase the range of products. The firm taken into consideration for the present work is Punj Lloyd Constructions limited. The company deals with the construction business and has a major number of stakeholders and branches in countries like Malaysia, Singapore, Indonesia, Sri Lanka, and Kazakhstan. The firm also deals with the oil and gas business in Malaysia but the main market share of the firm goes to Construction and engineering projects. The firm also deals with a different range of businesses consisting of aero services in India and Brazil. The firm basically has different shareholders. They are companies dealing with the construction business, raw materials, and companies providing steel and iron materials. Irrespective of these the key stakeholder of the firm is the leaders of the firm that provides a major amount of revenues to the firm and invests accordingly. The revenue of the firm was 1 to 10 million dollars till 2014 and then it increased to 100 million till 2020. The main competitors of the company are L and T construction, Siemens construction, TATA, and Birla. The company certainly has a major number of competitors from firms dealing with a similar business in India as well as the international countries. The work gives a proper amount of information regarding the global driver’s analysis of the firm along with understanding the different types of challenges faced by the firm to enter the international market and the impact of globalization on the firm.
2.0 Global driver’s analysis
Global driver’s analysis is applicable for the industries and companies that are globally operating the sector with a huge workforce. The driver’s analysis is also known as the key analysis according to the system of the business (Cui et al., 2018). The design is made in such a way by Punj Lloyd constructions so that the international clients are gathered in more and more numbers. The analysis is important so that the business expansion can be implemented easily without the changes in various management techniques. The global driver’s analysis focuses on three ideas regarding the business development and they are,
- Best ways for brand improvement
- Concentration in price reduction and improvement in quality
- Focus on producing an eye-catching brand
Figure 1: Global Drivers Analysis
(Source: Self-made in Word)
The main output regarding this driver’s analysis is a complete measurement regarding the importance of the business development and strategic analysis (Ceccorulli and Lucarelli, 2017). The importance of the sources is the main weight of the system and the management has to analyze the change in the businesses. The statistics are more and more important that decides the changes regarding the overall development of the business.
2.1 Yip’s global drivers model
Competitive Globalization Drivers
Yip’s global driver’s model’s most important aspect understands the competitive globalization drivers. Usage of this model can help Punj Lloyd to understand the efficiency of the competitive firms not only in national but also in international countries. Proper understanding can help the firm to make strategies that can help in improving the objective of higher exports and imports taking place in the firm but also improve efficiency against its competitors in different continents (Tocci, 2017). Most of the countries Lloyd deals with are in the Asian continent but weeks to reach the European region they can not only help in arranging better amounts of revenue but also get a better amount of customers that value the services. Having a proper understanding of the global competition can help the firm to make proper strategies for arranging revenues along with improving the innovative systems in the firm for better development. as per the ideas of Tocci, (2017), the main objective for Lloyd would be to concentrate on will be countries with lower trade barriers, areas target have lower transportation costs, arranging proper communication, maintaining the cut lengths, development of ICT and increment the spread of innovation and technology.
Cost Globalization Drivers
To overcome the challenges of competition and the rising rivals it is important for Punj Lloyd to understand the global scale economies that can be helpful for improving its performance is steep curve effect as well as improve the sourcing facilities that can help in the improvement of the efficiency of the firm. As per the ideas of Sith, (2017), The leaders of the firm also have to be careful about managing relations with the key stakeholders in the international construction market for arranging favorable logistics and understanding the exchange rates in different continents(Smith, 2017). Proper understanding of the global market can help the firm to improve cost so high productivity and plot various cost factors for sourcing, manufacturing, and development. The firm has to get a proper understanding of the costs difference of the products in different countries and select certain target areas that can help in arranging better revenues also with less amount of competition in the international market.
Market Globalization Drivers
One of the major tasks of the organization is to arrange a proper customer base that has common needs in national and international markets. Understanding the changing needs of the customers globally not only can heal the firm to improve its facilities but also increase its range of devices to get benefits in the international market. To improve its market position in the global market Lloyd has to be careful about managing properly working supply chains, making partnerships with different stakeholders, arranging raw materials in the firm properly(Puck and Filatotchev, 2020). Having proper communication and understanding the goals of the firm and the partners can help Lloyd to improve the transparency with them and improve the competitive position in the economic market.it is important for the firm to improve its independence from other partners that can also help in arranging a good economic balance in national and international countries (Vogelmeier et al., 2017). Targeting a particular economically stable and independent country will not only help the firm to get better deals but also multinational sourcing channels can help in improving trading and activities on investments. The increased frequency of cross-border transactions can also increase finance and competition.
Government Globalization Drivers
It is very important for an organization to understand the situation of the economy and political changes taking place in a country. Having a proper understanding of these notions not only helps the form to trade proper strategies to enter the targeted market but also understand the favorable trade policy that can be essential for the growth of the firm. Proper understanding of the competitive country can help Punj Lloyd to improve its technical standards and arrange innovative ideas for improving marketing regulations. The difference of rules in different countries can provide a huge amount of risk. Proper understanding of marketing regulations helps the firm to work with the government-owned competitors but also understand the concerns of the target government (Pishchikova and Piras, 2017). Proper understanding of the risks can help the firm to orbit taking further actions and target other countries and improve its performance.
Figure 2: Yips Global Drivers Model
(Source: Sef-made in word)
3.0 International entry strategy
Globalization is one of the key aspects that the companies are looking forward to and the Punj Lloyd constructions are related to the expansion of their business in the global analysis of the world. The change in the business strategies is one of the most important aspects because the management structure decides the business ideas and growth of the firm. The changes in the marketing scheme and detailed study about the people out there are the most important aspects that are required for the development of the system (Rinaldi et al., 2021). Hence this can be said that the changes are needed by the business of Punj Lloyd constructions so that the construction industry can be expanded according to the needs of the system.
There are certain objectives that Punj Lloyd can take into consideration for entering the international market that can not only provide certain advantages but also improve the arrangement of proper marketing strategies, improve arrangement of materials and sourcing and take proper control of the situation. The strategies can be,
Figure 3: International market entry strategies
(Source: Self-made in Word)
3.1 Using Exporting
Exporting is an important aspect for Punj Lloyd as the firm can make use of selling the products in international countries or the new market is the national country. It has been found that Punj Llyod most makes use of direct exporting in other countries in the market without the usage of any third party involvement. As most of the products of Lloyd are luxury products, usage of this strategy often does handy for the firm yet can be seen as a risky measure due to the continuous change taking place in the target market (Dialami et al. 2017). The continuous changes often let in changes of the currency amount and it becomes important for Lloyd to arrange proper information before making the agreement. This often increases the pressure to work on the firm and its employees.
3.2 Licensing strategy
Punj Lloyd has business in different sectors be it in providing construction or engineering services or service regarding the aeronautical facility. It has been found that even though the firm often makes use of direct exhortation certain risks can become barriers to the generation of revenues. The firm can make use of licensing started as this will help the firm to sell certain products directly to the international company but also improve its understanding of the changing needs of the construction materials of the international countries (Mol et al., 2017). This procedure can help Lloyd to get a license for certain products by selling them to other companies in the foreign market. Even though the strategy is quite positive, there are certainties related to it. The company punk is seeking to sell can have some buyer power which Lloyd has to understand. Not letting buyers overpower the cost range of the products can help Lloyd to improve its licensing strategy.
3.3 Ownership of the company
Making use of ownership of any company in the international market of new markets in the home country is part of the leader’s strategy that has been used by the competitors of Punj Lloyd. This type of strategy is quite popular in Asian countries that help the firm to sell the products in the international market without investing in the shipment and distribution process. Usage of this objective can be very helpful for Lloyd as purchasing an existing company and following similar processes in providing credibility also helps in better understanding of the local business (Newman, 2018). Owning a company is one of the least risky market entry strategies that help in boosting sales. Certainly has to understand the weakness of the target country and provide agreement promising to provide certain immunizations but also range better arrangement of ROI.
3.4 Using franchising
Making use of franchising can also be easier for Punj Lloyd as it will help the firm to take over small construction companies and pay for continuity in the work process. The age of franchising can only be seen in the western continents so before making use of this strategy Llyod has to improve its brand position in the market before taking over certain small branches and providing revenues and increasing the options of the facility (Biscop, 2019). There are a lot of benefits of franchising as it helps the firm to understand the new trends taking place in the construction services and improve its quality of work in other branches of the firm. There are certain risks of franchising that are mostly due to the importance of the brand position that also helps in getting the attention of the consumers. This type of approach also lets the target company join the franchise agreement and provide a way to earn profit irrespective of the indirect management approach.
3.5 Increasing outsourcing activities
There are different advantages of using the outsourcing strategy as it helps in hiring employees from different companies that deal with different types of business operations. The firm has to be considerate about making use of more innovative technology in the firm and usage of different working employees can help in improving facilities situation. Lloyd has to be considerate and make a proper agreement by understanding the strengths and weaknesses of the target company (Larik, 2017). Improving the strategies as per the weakness of the opposite firm can help Lloyd to increase the sale and promotion of the firm but also provide certain control of the outsourcing activities taking place. Although a certain amount of risk is also related to the situation as the opposite firm will also have a certain power of the outsourcing activities they can justify the sale of the products and also changes taking place in the employment cost.
After understanding the different types of market entry strategies it can certainly be said that making use of different types of strategies can be helpful for Lloyd to improve its market entry process in different countries but also help in arranging proper information regarding the strategies that can be helpful or the fir to improve its working process as per the changing needs of particular area and customers.
4.0 Globalization
Globalization is one of the most important aspects for every growing business in the world that is acquiring the latest trends in the system. Globalization means international development of the business and Punj Lloyd is focusing on the development of the business and its wide-spreading in the overall world. The management of the system is based on the development of the business and they are focusing on the expansion of the business in the external market and thus the external market demands are properly studied by the overall management of the system. Hence it is clear that the development of the system is based on the company management systems and the managers and experienced leaders are needed for leading the company to a perfect position in the international market.
4.1 Benefits of globalization
Spreading information and technology
The improvement of connection in communication has helped in the development of information and technology. Working in different markets and changes taking place due to globalization has groped international countries to more competitive, pieces of machinery and advanced technology that helps in improving the productivity of Construction business without creating workload on the manpower (Arteaga and Arteaga, 2017). The usage of effective communication can help Lloyd to indulge in advanced working processes in the home countries that can help in getting a competitive advantage.
Getting lower cost for raw materials
Lloyd has to deal with the use of raw materials on a regular basis for completing the work of competitions the organization certainly targets countries that need construction on a regular basis but also target country that has a lower cost of minerals. This type of strategy can help the firm to get lower the cost of raw materials and provide a huge amount of profits by making savings.
Access to new market and talent
Access to new markets can help the firm to get new opportunities to sell the products and increase the construction business and better amount. The difference in culture can help the firm to get back to a more flexible work environment (Biscop, 2021). The arrangement of proper methods of promotion and employment opportunities can help the firm to get better work processes and the generation of n ideas.
4.2 Challenges due to market globalization
The challenges that can be considered due to globalization in the international market can be regarding the changing needs of the elves and the situation of competition
- The cost structure and management of the firm have to change when it has to work in international countries (Koziej, 2017). It becomes important for the first to understand the changes of the economy taking place in the international country.
- The presence of different cultural people also leads to major challenges and the firm has to prioritize their traditions and cultures (Xingang et al., 2017). Using a flexible workplace can help in reducing challenges.
- The issues of competition will also be upon Lloyd as in most countries the development of the needs of the firm target and goes under construction work regularly that can prohibit the firm from improving its work process.
- It is important for the firm to treat areas of the country that have less competition and make use of buying strategies of small companies to reduce the competition.
5.0 Conclusion
After understanding all the information about the business Punj Lloyd deals with it can certainly be that the firm has the potential to increase its business range from the Asia continent to other places. The firm has different type of engineering and construction business ideas in the home country but also in Kazakhstan, Malaysia, Indonesia, Sri Lanka, and Singapore. The company mostly targets developing and developed countries that mostly are in need of trust be construction firms. The impact of globalization has certainly changed the working process of the construction business in various countries.
After usage of the Yips globalization analysis, it was found that the usage of cost, government, competition, and market drivers tend to provide impact on the growth of the business bit usage of the right protective strategies can ensure the firm can overcome the barriers and enter the international market. The firm can make use of different market entry strategies to enter different continent markets and countries. Usage of particular ways cannot be helpful for the firm as per the changes in the market. It was found that the major challenge faced by the firm due to globalization is regarding the changing requirements and competition. It is important for the firm to understand the advantages of the competition and continue working on the formation of strategies that diminishes the impact of the challenge of globalization in the international market.
Reference list
Journals
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