This sequential operation results in declining unit labor cost and overhead, ultimately cost leadership strategic advantage of the company in the marketplace. According to Levitt, the well knowledgeable customers are heading towards a ‘convergence of tastes’ and thus, every global corporation should maintain its ‘economics of simplicity’ and the success of future global corporations depends on their adopted strategies. “Everywhere everything gets more and more like everything else as the world’s preference structure is relentlessly homogenized” (Levitt, 1983). This paper is presented to analyze the traditional views of globalization strategy as mentioned Levitt thirty years ago and the changing scenario of global strategy in modern day context.
The purpose of this article is to review and evaluate various perspectives and theoretical basis of formulating a global strategy in according with Levitt’s Globalization viewpoints and to provide an integrated conceptual framework of global strategy that can synchronize the traditional global corporation views with modern day business situations. Lastly, from this article, implications of the historical study performed by Levitt with respect to emerging markets can be deduced which can provide necessary background for future research as well as incorporate into the changing internationalized management practices. Overview of Global Strategy Literature In academia, interest in global strategy by organizations has been strong for last three decades.
A number of perspectives were proposed to examine this issue of increasing global competition. The most provocative and critically evaluated theory was Levitt’s “Globalization of Markets”. The Globalization of Markets In the backdrop of the changing world of 21st century, the world is becoming more like a single market. Despite having deep rooted cultural differences, the worldwide consumers are becoming more and more homogenized.
Thus traditional multinational’s strategy of customizing the products according to the needs of the diversified markets may become a source of their competitive disadvantage. Internationalized organizations are opting strategies to develop more advanced, functional, reliable and standardized products, at the right price, on a global scale. The converging commonality of modern day world is a result of technological advancement. Almost every knowledgeable customer is wishing to experience advanced products/services offerings via the new technologies.
Barney, J., 1991. “Firm resources and sustained competitive advantage”. Journal of Management. Vol. 17 March.
Bartlett, A. and Ghoshal, S., 1989. Managing Across Borders: The Transnational Solution. Boston: Harvard Business School Press.
Bartlett, C. and Ghoshal, S., 1988. “Organizing for worldwide effectiveness: the transnational solution”. California Management Review. Autumn.
Bartlett, C. and Ghoshal, S., 1991. “Global strategic management: impact on the new frontiers of strategy research”. Strategic Management Journal. Vol. 12.
Collis, D.J., 1991. “A resource-based analysis of global competition: the case of the bearings industry”. Strategic Management Journal. Vol. 12.
Douglas, S.P. and Craig, C.S., 1989. “Evolution of global marketing strategy: scale, scope, and synergy”. Columbia Journal of World Business. Autumn.
Hamel, G. and Prahalad, C.K., 1985. “Do you really have a global strategy?” Harvard Business Review. Vol. 63, July-August.
Hout, T., Porter, M.E. and Rudden, E., 1982. “How global companies win out”. Harvard Business Review. Vol. 60.
Kogut, B., 1985. “Designing global strategies: comparative and competitive value added chains”. Sloan Management Review. Autumn.
Levitt, T., 1983. The Globalization of Markets. Boston: Harvard Business Review.
Ohmae, K., 1985. Triad Power: The Coming Shape of Global Competition. New York: Free Press.
Porter, M.E., 1986. “Competition in global industries: a conceptual framework”. Competition in Global Industries. New York: Free Press.
Quelch, J.A. and Hoff, E.J., 1986. “Customizing global marketing”. Harvard Business Review. Vol. 64, May-June.
Yip, G.S., 1989. “Global strategy … in a world of nations?” Sloan Management Review. Autumn.
Zou, S. and Cavusgil, S.T., 1995. “Global strategy: a review and an integrated conceptual framework”. European Journal of Marketing. 30, 1.