Global Strategy Development & Implementation Assignment sample

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1. Introduction Of Global Strategy Development & Implementation

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Ashahi Breweries is a Japanese Beverage company and the company is headquartered in Sumida, Tokyo, Japan. This Japanese Beer company is planning to develop its global footprint and planning to build its subsidiary at Norway. The company will expand their branch through Joint Venture with Hansa Borg Bryggerier Beer Company of Norway. Global strategy helps a business to create strategy for expanding their global market (Peng, 2021). In regard to this, Ashahi is also taking help of global strategy to expand their market in Norway.

This report has primarily focused on the Ashahi group and related processes to develop their market in Norway. In this context, The Company has taken the help of global strategy to expand their horizon. For analyzing purpose, widely used market analyzing tools like PESL and Porter’s Five Forces have been elaborated to identify the related circumstantial occurrences and for understanding the market of Norway. Apart from this, the research has focused on the strategies of penetrating the market of Norway and has identified several issues in this regard that may hamper the successful operation of Ashahi in Norway. The final part has mainly highlighted the solution of the raised problem to assist the Ashahi beverage company in gaining a successful business story in Norway.

2. Company overview

Ashahi Breweries is one of the most popular brewers in Japan. The company also operates a large variety of alcohol and soft beverages, as a matter of fact, it has also proved to be capable of improvising its working efficiency through a large number of advertisements and promotions. However, its sales promotion expenses and production efficiency have been developed through focusing on center brands and the latest value products.

3. Porter’s Diamond Model

Porter’s diamond model has been utilized by various national and multinational companies in order to extend and generate competitive opportunities for the required growth and universal development of a company. The primal factors of this model are corporate strategy, structure & competition, conditions of factor, the circumstances of demand, and linked and supporting industries (Anderson, 2017).

Factor Conditions

· There are multiple amounts of natural resources including prepared and production plants along with proper water channels which formulates the method of the firm quite cheaper to contact (Umemura, and Slater, 2021). As a matter of fact, the components required to be refined regularly.

· The infrastructure of Ashahi Breweries is basically improvised through the country’s support of its internal resources. Therefore, this support has been proved to be significant for the firm to develop in the global marketplace (Park, and Hong, 2019).

· In the case of Ashahi Breweries, Human resources inhabit the training courses within superior investment programs which were assumed by the company itself, in relation to its crucial employees and human resources around the world (MARY, 2018).

Related And Supporting Industries

· The existence of related industries in the global and household market has also been a resource for expansion and enlargement in terms of internationalization for Ashahi Breweries.

· The involvement of supporting industries in the entire expansion process of the industry has been proving to be beneficial which is also acceptable for Ashahi Breweries to expand the business functions and attracting consumers by creating awareness for a superior product consciousness and recognition (Park, and Hong, 2019).

· According to the context, the function of competitor industries is to force the company to carry out authoritatively and also determine the newest markets in order to grow revenue streams.

 Strategy, Structure, And Rivalry

· The primal intention of Ashahi Breweries is to take advantage of buyer's worth and pleasure. As a matter of fact, it moves towards tactical choices and emphasis in a comparable way.

· Ashahi Breweries is an additional lively company that has principles of open and unobstructed communication (MARY, 2018).

· The international competition has also permitted the company in order to forecast worldwide trending culture along with consumer behavior prototypes.

Demand Conditions

· It is certainly required to determine the actual size of Ashahi Breweries for its exceptional growth and internationalization events.

· Sophisticated and challenging sounders have been responsible for pushing the firm in order to utilize its capital towards expansion (Umemura, and Slater, 2021).

4. Possible strategic choices available to the parent Company

Ashahi Breweries has encountered multiple difficulties to operate in various foreign marketplaces. However, the company is now constantly taking initials for emerging into the latest foreign markets. As a matter of fact, this company implements various strategies including transnational, multi-domestic, global, and domestic strategies for emerging in the marketplace of Norway.

  • Transnational Strategy: Transnational strategy describes multiple numbers of actions taken by the company hereby a business comes to a decision to perform its several actions transversely global marketplace. The general appliance of transnational stagey analysis the entire procedure and assets, connecting them in diverse countries in which the company operates or trying to operate (MARY, 2018).
  • Multi Domestic Strategy: Multi domestic strategy’s primal motive is to deliver immense concentration on the preferences, responsiveness along within the local markets. The company has to take initials in order to initiate in the foreign marketplace. The company can develop the service quality and therefore by implanting various strategic skills the company gets to draw attention towards its potential customers. Through implementing several multi-domestic strategies the company will be capable to compete with its rival in the international market along with various foreign markets (Kitayama, Williams, and Takeshita, 2020).
  • International Strategy: Implementing an exceptional international strategy will be extremely beneficial for Ashahi Breweries to increase the ability to supply goods and to get an exceeding rate of productivity. International strategies describe various tactics regarding the foreign market value, cultural impact, and marketing strategies which will be beneficial for the company to get succeeded in the marketplace of Norway. However, it is extremely beneficial for Ashahi Breweries to understand the cultural impact on the business and how it will be beneficial for the company (Popescu et al., 2021). By identifying local people’s demands the company will be able to achieve numerous successes in the marketplace of Norway.
  • Global Strategy: Global strategy emphasizes economical infrastructure and offers exceptional advantages to commercialize discoveries manufactured at the company level. As a matter of fact, the global strategy will not be accommodating for Ashahi Breweries in creating operational choices transversely nationwide limits (Kitayama, Williams, and Takeshita, 2020).

5. Country Analysis

5.1 PESL analysis of the country Norway

Political

  • Norway is among the world's few countries with a stable political atmosphere.
  • Norway's tourist business has also benefited from this stable political atmosphere.
  • There have been no large-scale political feuds in Norway in recent years.
  • Norway maintains cordial ties with the remaining member nations and allows them to benefit from discounted tariff rates (Gulbrandsen, Inderberg and Jevnaker, 2021).

So it can be evaluated from Norway’s political analysis that the Ashahi Breweries that deals in beverages will face no problems regarding political issues to expand its business. Norway being a tourist attraction and politically calm country will fetch a large amount of profit to its businesses. Thus, it can be said that Ashahi will be flourished with benefits as the country offers a lots of possibilities to the growth of businesses functioning in the country.

Economical

  • The Norwegian government has nurtured the businesses to maximize income generation.
  • Norway's economy is diversified, comprising industrial and non-industrial segments (Standal, Talevi and Westskog, 2020).
  • Norwegian economic research reveals a high standard of living in comparison to the rest of the globe.

Norway’s economical factor will undoubtedly help Ashahi to retain their success there as it will be nurtured by both the governments and economical opportunities available there. The company can gain lots of profit in Norway because Norwegians like to pay for quality items. If Ashahi perpetuates the excellence of its beverages then it can definitely swell a great amount of profit.

Social

  • Norway’s populace is very literate in English. This facilitates outsiders' entry to the nation.
  • The population's familiarity with English language enables the tourist sector to thrive.
  • Norway's overall working conditions are excellent (Pincinato et al., 2021).

Ashahi Breweries will not face any problem to connect the Norwegians as communication will not be a barrier in expanding the business rather owing to its welcoming nature and picturesque environment Norway attracts a lot of travelers and visitors, so Ashahi has a chance to swell a lot of profit and evolve into a improved company. 

Legal

  • Norwegian legal system as an example of how a just and progressive judicial system should be run and function (Hungría and Hungría, 2020).
  • The legal system assures that all businesses are treated similarly and that all social borders are dismantled and destroyed.

Norway offers a chance to all of the business functioning inside it to be treated similarly and also offers the opportunity to flourish by providing law of security. Ashahi will also flourish due to Norway’s protective legal characteristics.

5.2. Country Environmental Analysis

5.2.1 PESL

The analysis has described in detail the environment of the Norwegian beverage company. Undoubtedly, Norway is the most peaceful country and does not encourage any kind of conflict inside the country. The political stability along with the strictly maintained laws will encourage Ashahi to flourish in the beer market (Maehle, 2020). A country that holds one of the foremost positions in the happiness index and acquires one of the lowest unemployment rates indicates a shining future for any business. Purchasing power and economic status are very crucial for any business as they dominate the sales and revenue of a company. Therefore, the economic stability indicates a long journey for Ashahi. Sound working conditions, tourism explosion and no barrier in language have provided an abundant opportunity to the company. Apart from this, the happiest country is considered to be the most peaceful because Norway strictly follows their law to maintain its reputation.

5.2.2 Porter’s five forces

Rivalry

The million-dollar beer market of Norway is dominated by two beer companies (Rakap, 2018). Their dominance has influenced the beer price of Norway as well. The most established beer company, Ashahi, can easily enter the market and can give fierce competition to its rivals.

Threat of Substitutes

The threat of substitutes happens when in the market other companies provide similar products at a lower price (Bruijl, 2018). Substitute product hampers the ability of the making profit for a business. Penetrating in Norway market will be beneficial for Ashahi because of the high demand.

Threat of entry

When competitors can easily enter a new market due to low barriers, this issue rises (Grebenshchikova and Yakushev, 2017). Ashahi’s expansion in Norway is proven to have less threat and the market provides various opportunities for the company.

Buyer power

Buyers start to negotiate when they are strong in a market (Bruijl, 2018). In Norway, the population is low and the demand for beer and beverages is high that is good for Ashahi.

Supplier power

The supplier will be powerful when there is a fewer number of suppliers in a market. That dominance of suppliers often causes a business to spend more on raw materials that lead to a rise in price. The energetic Ashahi beer company should definitely penetrate into the Norway market because of having fewer suppliers in the market.

Fig 2: Porter’s Five Forces Model

(Source: Heubel, 2021)

  • Benefits

As per the report of Statista, around 2.73 million hectoliters of beer is consumed in Norway in 2019. The beer market is expected to grow by 4.74% by the year 2025 (Statista, 2021). The rise of the Covid 19 pandemic has tremendously increased the sales of beer and beverages in Norway. The most renowned beer companies of Norway, Carlsberg and Hansa Borg Bryggerier have seen a boost in sales even during this financial crisis (Maehle, 2020).

  • Costs

Norway is considered to have the lowest corruption rate in the world and has ranked 7th position in Corruption Perceptions Index for being the least corrupted country in the globe. In terms of infrastructure, the country is economically well developed and the quality of infrastructure is undoubtedly good in this country. The law of the country encourages other businesses to expand in their country as a part of the profit will help the economy as well.

  • Risks

The political stability and legally sound country, Norway, definitely is the best country for expanding business.

6. Strategic entry modes of the company

A strategic joint venture has been proving to accommodate for international expansion among the foreign market. It is a significant business agreement between two foremost companies having the capability of making vigorous decisions through working with each other. The primal focus of the joint venture is to generate a combined aim to accomplish an explicit ambition and in order to boost their respective bottom lines.

The primal reason for choosing or selecting joint ventures in the marketplace of Norway is to get rapid brand recognition for Ashahi Breweries as it will be the most efficient and quickest way to get recognized by the people of Norway (Popescu etal., 2021). As a matter of fact, strategic joint ventures have been proving to be beneficial for several companies in order to emerge in the selected marketplace otherwise it was quite difficult to enter without having the importance of connections and restricted intelligence to on-the-ground operatives in the area. It will be significant for Ashahi Breweries to create a joint venture within the foremost beer and water manufacturing industry, Hansa Borg Bryggerier Beer. 

As a matter of fact, this joint venture with Hansa Borg Bryggerier Beer can accommodate Ashahi Breweries to get recognized and rapid popularity for the expansion of the business. Social and cultural impact also has been considered as one of the most significant factors for getting succeeded in the foreign market (Almiron, etal., 2021). Having the partnership within one of the most beer manufacturing company, it will be accommodating for Ashahi Breweries in order to operate in the marketplace of Norway effortlessly. Therefore, the share of the venture owned by the two companies largely depends on their own individual contributions. Also, it has been observed that the most successful joint ventures are the companies where both companies achieve an equal amount of profits by implementing strategy (Almiron, et al., 2021).

In the case of Ashahi Breweries, implementation of successful joint ventures will become accommodating for accessing specific skills and various capabilities that they would or else be incapable to expand themselves in the foreign marketplace. Creating a joint venture with Hansa Borg Bryggerier Beer will be significant for understanding the risks factors and or cultural default of the country (Umemura, and Slater, 2021). As a result, the company can take initials thorough great maintenance of social and legal regulations of Norway. Otherwise, it will be problematic for Ashahi Breweries to enter the marketplace of Norway.

7. Identification of the issues in the management and organizational performance

During the time of operating in the foreign market, the company can face or encounter several problematic situations regarding the subject of organizational coordination. Regarding the fact of internationalization procedures, Ashahi Breweries has to deal with various difficulties including Conflicting Norms for Decision-Making, Lack of self-confidence and

It has been observed that individual cultures have their own way of reaching an executive decision. As a Japanese company, has several difficulties regarding the fact of the decision-making process which can be problematic in the process of internalization (Umemura, and Slater, 2021). As a matter o0f fact, the employees of this company have faced numerous difficulties regarding the inability to experience in the international market. Lack of confidence is one of the major issues in the organization for not operating in various foreign markets. In the case of centralizing organizations, there are several difficulties about the fact of employees loyalty-related issues. In the case of Ashahi Breweries, there is no initiative of work because employees complete tasks conceptualized by executives.

8. Appropriate Solutions Regarding the Challenges of the Company

In the above section, it has been seen that the company has faced various challenges that can disrupt the potential situation of the organizational process. Regarding this matter some probable solutions are listed below:

  • As per the evaluation of the report of the company it has been seen that the company has faced a commutation gap in the process of the company. From the company report, it has been seen that the managers of the company have followed the advanced technological system that enhances communication but in front, it seems like a gap. That is why the company has to Active listening is the first step toward effective communication. If they simply concentrate on how others express themselves, they will find it much easier to comprehend individuals from all walks of life (Barker, 2010).
  • As for the internationalization of the business, the company has faced various languages that heavily affect them in their operational process. Therefore, engage the services of a translator or interpreter. While many individuals are proficient in the foreign language in which they work, employing a professional translation may assist in resolving errors and misunderstandings (Zenone, Cezar and de Hoyos Guevara, 2021).
  • Another very common thing is the cultural diversity that has made great complications. The company is going through a centralized manner as has been seen in the previous section of the report. Rather than relying on preconceptions, they should seek prototypes—cultural mean values or aspects of conduct. There is a significant distinction to be made between stereotypes and prototypes.
  • Effective communicators often possess advanced social skills and the ability to regulate their expressions of thoughts and emotions toward people around them. To determine what is acceptable to say in a variety of interpersonal situations (Barker, 2010). Creating a filter will assist in supplementing other communication methods, ensuring that they retain a particular degree of civility and prevent workplace friction.
  • Alongside, the political situation has hampered the proper operating process of the company. In that case, the company has to concern about all political factors and take action immediately to resolve these.

9. Conclusion

Every business wants to extend its operations abroad in the age of global commerce. Businesses create plans for internationalization in accordance with their goals. In that instance, Ashahi Group Holdings, Ltd. is a Japanese multinational conglomerate specializing in beer, liquor, soft drinks, and cuisine with headquarters in Sumida, Tokyo. Norway has been found to have both severe environmental issues and advantages as a consequence of this research. It has been established that the company will operate normally in this condition. On the other hand, the business must be adequately concerned about Norway’s strategic importance. This particular report has given detailed elaboration about the internationalization strategies that can help a company to expand its business. Additionally, this research used the Hofstede cultural model to analyze the corporation’s culture and administrative elements. Additionally, based on the identified issues, this research offered several suggestions for possible solutions

References

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Anderson, R.G., 2017. History of industrial brewing. In Handbook of Brewing (pp. 1-34). CRC Press. Liu, Y., Wei, M., Zhang, T., Qiao, H. and Li, H., 2021. Overview on the development and critical issues of water jet guided laser machining technology. Optics & Laser Technology, 137, p.106820.

Barker, A., 2010. Improve your communication skills (Vol. 39). Kogan Page Publishers.

Bruijl, G.H.T., 2018. The relevance of Porter's five forces in today's innovative and changing business environment. Available at SSRN 3192207.

Grebenshchikova, L.S. and Yakushev, N.M., 2017. Definition of Competitiveness of the Enterprise Using the Five Forces of M. Porter. Vestnik IzhGTU imeni MT Kalashnikova, 20(3), pp.51-53.

Gulbrandsen, L.H., Inderberg, T.H.J. and Jevnaker, T., 2021. Is political steering gone with the wind? Administrative power and wind energy licensing practices in Norway. Energy Research & Social Science74, p.101963.

Hébert, L. and Beamish, P., 2017. Cooperative strategies between firms: international joint ventures. The Blackwell Handbook of Cross?Cultural Management, pp.78-98.

Hungría, E.M. and Hungría, E.M., 2020. Understanding the legal development and challenges regarding underwater noise pollution in Spain and Norway. Actualidad Jurídica Ambiental, (107), pp.69-91.

Kitayama, K., Williams, C. and Takeshita, S., 2020. Corporate Governance and Internationalization in Japanese Brewing Companies. New Developments in the Brewing Industry: The Role of Institutions and Ownership, p.273.

Maehle, N., 2020. Mohn Centre for Innovation and Regional Development, Western Norway University of Applied Sciences, Bergen, Norway. Case Studies in the Beer Sector, p.239.

Maehle, N., 2020. Mohn Centre for Innovation and Regional Development, Western Norway University of Applied Sciences, Bergen, Norway. Case Studies in the Beer Sector, p.239.

MARY, A., 2018. ASHAHI BEVERAGES: FACING THE CHALLENGES OF GLOBALIZATION. Business Development, Merger And Crisis Management Of International Firms In Japan: Featuring Case Studies From Fortune 500 Companies, p.31.

MARY, A., 2018. ASHAHI BEVERAGES: FACING THE CHALLENGES OF GLOBALIZATION. Business Development, Merger And Crisis Management Of International Firms In Japan: Featuring Case Studies From Fortune 500 Companies, p.31.

MARY, A., 2018. ASHAHI BEVERAGES: FACING THE CHALLENGES OF GLOBALIZATION. Business Development, Merger And Crisis Management Of International Firms In Japan: Featuring Case Studies From Fortune 500 Companies, p.31.

MARY, A., 2018. ASHAHI BEVERAGES: FACING THE CHALLENGES OF GLOBALIZATION. Business Development, Merger And Crisis Management Of International Firms In Japan: Featuring Case Studies From Fortune 500 Companies, p.31.

Park, Y.W. and Hong, P., 2019. Creative Innovative Firms from Japan. Springer Books.

Pincinato, R.B., Asche, F., Bleie, H., Skrudland, A. and Stormoen, M., 2021. Factors influencing production loss in salmonid farming. Aquaculture532, p.736034.

Popescu, G., Istudor, N., Boboc, D., Constantin, F., Zaharia, A. and Diaconeasa, M.C., 2021. Integrating sustainability in the Romanian beer industry. Case study: URSUS Breweries. In Case Studies in the Beer Sector (pp. 299-312). Woodhead Publishing.

Rakap, Ø.E., 2018. Brand line positioning in the Norwegian mass-produced beer market: a comparative brand association study (Master's thesis).

Standal, K., Talevi, M. and Westskog, H., 2020. Engaging men and women in energy production in Norway and the United Kingdom: The significance of social practices and gender relations. Energy Research & Social Science60, p.101338.

Statista. (n.d.). Norway: beer consumption 2012-2019. [online] Available at: https://www.statista.com/statistics/446800/volume-beer-consumption-norway/ [Accessed 6 Aug. 2021].

Umemura, M. and Slater, S., 2021. Institutional explanations for local diversification: a historical analysis of the Japanese beer industry, 1952-2017. Journal of Strategic Marketing, 29(1), pp.71-92.

Zenone, A.C., Cezar, B.B. and de Hoyos Guevara, A., 2021. INTEGRATING CULTURAL DIVERSITY IN ORGANIZATIONS: RECRUITMENT AND SELECTION. Journal on Innovation and Sustainability RISUS12(2), pp.83-90

Peng, M.W., 2021. Global strategy. Cengage learning.

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