What is a transnational business strategy

1. Get a complete guide to business strategies at Bstrategyhub.com. We provide business models and SWOT analysis of various companies. Follow us on social media for more information. You may think that a company that operates globally is just called a global company. However, there are actually four different types of globalized businesses: Global International Transnational Multi-domestic Each of these strategies entails different business priorities for the company. Multi-domestic – For multi-domestic corporations, responsiveness to local markets and the needs, demands, preferences, and such of consumers within that region is the highest priority. As such, multi- domestic companies sacrifice global integration and efficiency for higher local responsiveness. Global – Companies with a global strategy, on the other hand, prioritize global integration above all else. Local responsiveness is much less of a priority, so these companies’ products, services,

2. marketing, and operations will not differ among different regions. Instead, the company will have only one product or service offering, one branding and marketing strategy, and one operational strategy worldwide. Transnational – As you can see, transnational business strategies rank high in both global integration and local responsiveness. They are essentially the best of both worlds – like global companies, transnational corporations have one efficient, global strategy integrated across all markets. However, they also reflect multi- domestic companies by maintaining responsiveness to local and regional markets. Here, we’ll explain how transnational companies incorporate both of these elements into their business strategies, what are some recognizable examples of transnational companies, and what are the advantages and disadvantages of this strategy. The main characteristics of a transnational business strategy High global integration High local responsiveness High global integration Transnational companies have a centralized management team and head office that coordinates all of its international operations. Unlike multi- domestic companies, which have nearly totally independent subsidiaries in each region, all of a transnational company’s regional divisions are dependent on the central global office. While some transnational business strategies will allow for more autonomy for local divisions than others, the generally defining characteristic of a transnational corporation is high integration across all of the company’s operations worldwide. Most of the company’s strategies are standardized across all regions in order to maintain efficiency and lower costs as much as possible. For the most part, each of the regional branches of the company will follow a central business

3. and marketing strategy and will operate within parameters set by the head management team. High local responsiveness However, while transnational companies strive for global integration and efficiency, they will still observe the local markets in which they operate and respond accordingly. For instance, the company will have one global product or service offering but may also have a few additional products and services that are unique to the local market. Or, products and services that aren’t in demand or aren’t relevant in the local market may not be available in that region. In addition, a transnational business strategy will have a global branding and marketing strategy but will tailor its campaigns, messaging, and communication depending on the region that the marketing airs in. Transnational companies understand the importance of being sensitive toward local culture, language, lifestyles, etc. and, as such, will ensure that their marketing content aligns with the local culture and language of that region. While multi-domestic companies will allow their regional managers full autonomy in the creation of marketing content, transnational corporations are more likely to allow local branches to translate the company’s global message into the local language, bearing cultural norms and consumer preferences in mind. Transnational companies essentially balance global standardization and efficiency with the ability to tailor products, services, and marketing to local markets. It has been said that transnational businesses “think globally and act locally.” Website :- https://bstrategyhub.com/