The Importance of Strategic Management in International Business

Introduction

Strategic management is the ongoing business planning, monitoring, analysis and development of the strategic planning for the international businesses in order to meet the organisational goals and objectives (Morschett, Schramm-Klein and Zentes, 2015). The aim of the study is to analyse the international business strategic management and understand its importance in running the international firms in near future. The study also helps to develop proper understanding about the strategies of the organisations in running their business internationally, so that they can gain high competitive advantage in the market. Hereby, through this study, it is possible to evaluate the strategic options and critical success factors of the organisations to run their business across the globe. In the recent era of globalisation, all the multinational corporate firms are operating in the market and they try to develop effective strategic planning for gaining high competitive advantage as the competition in the market recently is intense and it is very difficult for the firms to gain high markets share bud delivering huge numbers of customers in the market. The statement in this study is to discuss the strategic options of the international firms where the companies try to implement effective strategic planning in heir business to expand their firms internationally. The study explores the strategic planning of the international firms in order to run their business across the globe and furthermore the study provides a scope to understand the importance of strategic management for an international company in expanding their business successfully by securing future sustainable development.

Strategic planning of the international business

Strategic planning is necessary for the organisations, where the corporate firms try to reallocate the organisational resources for better performance. In this regard, the strategic planning of product strategy, pricing strategy, placing and process innovation as well as promotional strategic planning is effective for the international firms to run their business in a systematic manner (Reiche et al., 2016; Morschett, Schramm-Klein and Zentes, 2015). In this regard, as per the products, the corporate firms try to maintain the quality and design as well as raw material of the products so that the final goods can satisfy the customersvand fulfils the requirements and expectations of the buyers. Proper packaging style, labelling and the quality products are the major strategies to retain the customers for long run (Hamilton and Webster, 2018). In addition to this, the pricing strategy is another effective strategic move of the business, where the multinational corporate firms try to follow premium pricing strategy to grab the market opportunities, so that the products can be introduced in the market and the brand can be established successfully, and in the premium pricing strategy, the firms try to deliver the quality products at completive price s that the customers can understand the values of the product and afford the price for the quality products (Willcocks, 2018).

In addition to this, the corporate firms try to strengthen their supply chain by hiring the efficient distributors and supplier who can manage the warehouse and maintain the stock of the products successfully (Hamilton and Webster, 2018). The multinational corporate businesses are trying to follow green supply chain where they use electric vehicles for making the business sustainable where the firm can provide positive environmental footprint in running their business ethically (Morschett, Schramm-Klein and Zentes, 2015). This is an effective initiative in the rennet years, where the people are concerned about environmental protection and the firms are trying to create value for the social communities by making the business environmentally sustainable, where the use solar panel and wind energy or utilising the renewable resources and saving the natural resource of the earth as well as using electric cars or reducing greenhouse gas emission are effective for the companies to secure future sustainable development (Hamilton and Webster, 2018). In addition to this, recently, the firms invest in technological development for process innovation and in this regard, investment on Information and Telecommunication Technology and strengthening the Information Technology of the business expand the opportunity of globalise the business and access the market information for further expansion of the operational activities in near future (Noe et al., 2017).

Additionally, the organisations invest on marketing promotional activities where social media advertisement, sending personalise email, interacting though social media as well as word of mouth, television advertisement and social campaign are effective to promote the organisational products and services in the market which in turn helps the firms to strengthen their customer’s base in near future (Myers, 2019). Apart from that, the firms try to utilise the organisational resources and strengthen their employee’s base in long run for managing internal conflicts in the organisational workplace and develop suitable organisational culture in order to enhance the organisational performance (Noe et al., 2017). Hereby, the strategic planning of products and pricing as well as process innovation and technological advancement, international marketing and environmental sustainability are the major strategic planning of the international corporate firm to globalise the business and gain high competitive advantage in the international market (Buckley et al., 2019).

Importance of strategic management in business

The strategic planning is important for the all the multinational corporate firms in order to run their business in the market where the competition is high and it is hard for the organisations to run their business by proper utilisation of the organisational resources and capabilities. It is beneficial for the firms to develop effective strategic management after analysing the external and internal business environment, where the firms are trying to evaluate the market demand and identify the future opportunities in running their business internationally (Rothaermel, 2017). It is hereby necessary for the corporate firms to have proper strategic management planning in order to expand their business strategically and gain high competitive advantage over other competitors in the market. Additionally, it is also necessary for the organisations to maximise the profitability and enhance the sales volume which can be possible through effective development of the organisational strategies (Lasserre, 2017). For identification of the market opportunities and understanding the demand in the market, it is necessary to analyse the market and develop proper strategies. Strategic management for the international businesses provides an opportunity to the firms to improve coordination and enhance communication in the market which in turn helps to enhance innovation and creativity of the business.

In addition to this, the strategic planning is beneficial for the firms to develop effective products and pricing strategy in order to attract the customers in the market and it in turn provides a scope to strengthen their customers base and secure future sustainable development. The strategic planning is also effective for the international corporate firms to develop the planning for running the process and strengthening their supply chain to run the business operational activities internationally (Binder, 2016; Lasserre, 2017). Through developing proper strategic management, the firms are also able to secure future development and growth of the company through enhancing their performance in the market (Rothaermel, 2017). It further minimises the adverse condition and enhance the capabilities of the firms to serve better products and services to the customers which in turn helps to maximise satisfaction among the customers (Buckley et al., 2019). Moreover, the strategic planning of the firm provides proper direction in which the firm can be established well in the market and it is beneficial for the organisations to make effective decisions for running the operational activities properly.

Managing human resources and reallocating the organisational resources are also possible under the strategic management planning. Improving stability of the business as well as strengthen the management process is also other importance of the businesses in order to conduct their operations in the market successfully. Hereby, through developing proper strategic planning, the international firms can get high market hare across the globe and it further provides a scope to strengthen their position in the market by retaining long term buyers. It improves the understanding about the strategies of the competitors and also it helps to initiative and influence firm’s performance by utilising latest technology and organisational resources (Noe et al., 2017; Buckley et al., 2019). Moreover, it is also beneficial for the firms to run their operation internationally ere the companies are trying to formulate better strategy to attract more audiences in the market (Buckley et al., 2019). Hereby, proper direction towards strengthening the organisational process, reallocation of the resources and utilising the organisational capabilities are possible through the strategic management planning and it further provides a scope to enhance the performance of the business in running their business internationally.

Conclusion and recommendations

It can be concluded that, the strategic management process is beneficial for all the corporate firms in running their businesses across the globe, where the organisations can secure future sustainable development by operating in the market efficiently. In this regard, the corporate firms in the recent era of globalisation and digitalisation aim to enhance innovation and creativity as well as establish the firm in the market by strengthening their customer’s base in the international market. It is hereby important for the firms to develop effective strategic planning for successful utilisation of the organisational resources and capabilities in order to gain high competitive advantage and get high market share across the globe. As per the strategic planning, it is necessary for the international businesses to develop proper strategic planning in order to improve their advantage in running their business in the market and in this regard, the strategic recommendations for the international businesses are described further.

The international firms need to invest on research and development so that proper product can be developed well and in this regard the firm should focus on products diversification strategy for managing the effective product line with variety of products and services, so that the customers can get the opportunity to choose the right products and services according to their personal needs and preferences. This in turn provides a scope to retain long term buyers. Additionally, the firm needs to manage their human resources where the strategic human resources management is necessary as the employees are the major stakeholders of the business, where the employees play crucial role in running the organisations activities strategically to fulfil the pre-specified goals and objectives of the firms. The employee management is hereby necessary where the manager needs to provide proper remunerations, salary and performance related pay to create values of the employees as well as provide organisational culture with diversity management and respecting each other, giving them freedom and harmony, enhancing communication and cooperation as well as developing partnership working process in the organisation. These activities are important to manage the employees and retain the experienced staff in the business for running their business operational activities proficiently and enhancing the organisational performance in long run.

The firms also need to deliver quality services and products to the customers at effective price, so that the customers can afford the products and services successfully, in the market and this further provides an opportunity to the international business to attract the audiences in the market and retain them for long run. In the recent era of digitalisation, the organisations must focus on innovation and creativity and in this regard developing company’s own website and managing the customer’s portal are necessary to fulfil customer’s queries and satisfy them properly by giving them 24*7 efficient services as per their requirements and expectations. This is effective for the businesses to secure future sustainable development and strengthen their customer’s base in long run. moreover, the organisations need to focus on developing mobile application in the recent era of digitalisation to make the order placement and payment structure easy for the customers and in this regard the sakes representatives needs to build strong relationship with the customers for giving them the opportunity to compare the products quality and price with other firms and influence the customers to make effective purchase decision. These are the major strategic recommendation through which the multinational corporate firms can run their business strategically in the global market and expand their business successfully, by retaining more long run customers in their business.

Reference List

Binder, J., 2016. Global project management: communication, collaboration and management across borders. London: Routledge.

Buckley, M.R., Wheeler, A.R., Baur, J.E. and Halbesleben, J.R., 2019. Research in personnel and human resources management. London: Emerald Publishing Limited.

Hamilton, L. and Webster, P., 2018. The international business environment. London: Oxford University Press.

Lasserre, P., 2017. Global strategic management. London: Macmillan International Higher Education.

Morschett, D., Schramm-Klein, H. and Zentes, J., 2015. Strategic international management (pp. 978-3658078836). Berlin: Springer.

Myers, M.D., 2019. Qualitative research in business and management. London: Sage Publications Limited.

Noe, R.A., Hollenbeck, J.R., Gerhart, B. and Wright, P.M., 2017. Human resource management: Gaining a competitive advantage. New York, NY: McGraw-Hill Education.

Reiche, B.S., Stahl, G.K., Mendenhall, M.E. and Oddou, G.R., 2016. Readings and cases in international human resource management. London: Taylor & Francis.

Rothaermel, F.T., 2017. Strategic management. New York, NY: McGraw-Hill Education.

Willcocks, L.P., 2018. Global business management foundations. London: SB Publishing.

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