The organization that you work for is interested in expanding their business overseas. You have been asked to gather some preliminary information to help management decide on whether to pursue this idea further.
Find an article describing an experience of either:
(1) a US company or division that conducts business in a foreign country; or
(2) a company or division based in another country which has started doing business in the United States.
Perform searches on "joint venture," "licensing," or "strategic alliance." Prepare a statement to the managers of the organization which answers the following set of questions:
- Was the company's experience positive, negative, or mixed? Justify your answer.
- What legal or political barriers did the company have to overcome? What technological obstacles did the company encounter? What cultural or business differences did the company encounter? What problems did these differences create for the company? What did the company do to overcome the obstacles? Did the company handle cultural and business differences effectively? Why or why not?
I have taken the case of McDonald's globalization strategy in India. The world-over it has followed the franchising routes to expansion, same as in India. In India it has faced unique challenges and has now become a successful brand in India.
ANSWER TO YOUR QUESTIONS
1. Was the company's experience positive, negative, or mixed? Justify your answer...
A.) "How" you arrived at your answer(s)
The company's experience in India is positive. It has been ranked No. 1 in food services in India.
(See reference NO.1 FOOD SERVICES MC DONALD'S INDIA)
"What" facts and sources you reviewed and considered
I have reviewed the articles on McDonalds and as a Management Thinker I am observing the growth of McDonald in India closely. The prime articles I have given as references.
I have also studied the strategy of KFC another multinational in India. After four years in India, Kentucky Fried Chicken (KFC) is struggling with four outlets, while McDonald's already has 16 in just two-and-a-half years.
(Think India to win India, Kohli Vanita)
With reports from Pallavi Bhattacharjee & Shuchi Bansal
B.) "Why" your response is the best one from all the alternatives
As quoting the article " McDonald's success is an intense understanding of India's culture and the psyche of its people - rarely researched so well by multinationals. "
In India it has introduced and successfully launched the product variants, which suits the Indian culture. For example Wider Vegetarian Menu, including local delicacies. It made the product affordable to attract the masses and to increase the turnover. McDonald's capitalized on the opportunity by developing products that have the potential to be sold by the parent's outlets around the world. The parent abroad is already replicating a few of these products - Pizza McPuff is being exported to McDonald's in the Middle east and McWrap, too, has created sufficient interest.
McDonald's made a burger, 'Indian,' and the experience of eating it 'Indian,' in tiny ways which one don't notice, but which influence the buying behaviour.
1276 words to describe the successes of McDonald's globalization strategy in India and what made that strategy effective. References included.