International Strategy • Advantages • Firm try to create value by transferring valuable skills and products to foreign markets where indigenous competitors lack those skills and products. • They tend to centralize product development functions at home. • Disadvantages • Due to the duplication of manufacturing facilities, firm that pursue an international strategy tend to suffer from high opreating costs. This makes the strategy inappropriate in manufacturing industries where cost presures are high Multidomestic Strategy • Advantages • Multidomestic firm extensively customize both their product offering and their marketing strategy to math differ national conditions. • They also tend to establish a complete set of value creation activities, including production, marketing, and R&D, in each major national market in which they do business. • Disadvantages • Many multidomestic firm have a high costs structure. They also tend to do a relatively poor job of leveraging core competencies within the firm. • Many multidomestic firms have developed into decentralized federation in which each national subsidiary functions in a largely autonomous manner. Global Strategy • Advantages • Global strategy focus on increasing profitability by reaping the cost reductions that come from experience curve effects and location economies. That is, they are pursuing a low-cost strategy. • Global firm prefer to merket a standardized product worldwide so they can reap the maximum benefits from the economies of scale that underline the experience curve. They may also use their cost advantage to support aggressive pricing in world markets. • Disadvantages • These conditions are not found in many consumer goods markets, where demand for local responsiveness remain high ( e.g., processed food products ). • This strategy in inappropriate when demands for local responsiveness are high. Transnational Strategy • Advantages • Firm with a transnational strategy was confronted with significant pressures for cost reductions and for local responsiveness. • Firm realized many of the benefits of global manufacturing while also responding to pressures for local responsiveness by differentiating its product among national markets. • Disadvantages • Pressures for local responsiveness and cost reductions place conflicting demands on a firm; being locally responsive raises costs.