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This paper discusses about foreign market entry and the diversification of business. It also creates an argument for diversification of business that will be presented to the board of directors or business investors. This paper develops the strategy that indicated the products and services for the diversification and how synergies may be gained from the diversified activity. It also identifies the foreign market that the company should enter and the strategy to enter the market. This paper provides the challenges that the company faces in the foreign market and details the strategies to minimize these challenges. It also concludes with the scenario in order to expand the organization into a foreign market.
Foreign Market Entry
I. Argument for diversification of business
The business diversification was the technique that reduced the risks by means of allocating the investments among the various financial instruments, industries and other categories. This also aimed to the maximization of return by investing in different areas that would each react differently to the business investors. The diversification was the most component of reaching the long range financial goals when minimizing the risk to the business investors. The organizational business diversification was based upon the enhancement of quality in order to mitigate the threats to the investor.
The enhancement of quality was the statement that provided the actions to succeed and increase the products and services to the business investors. This enhancement of quality can also make the threats to the competitors and but it was necessary to know the strength and weakness of competitors thatâ€™s why business investors can make the quality products and services than the competitors. The success of the business investment was based upon the quality products and services of organization (John Shaw, 2008).
This quality enhancement will lead the lower defects, reduction of product variability, increment of first pass rates, improvement of customer satisfaction, improvement of manufacturing yield, and reduction of scrap and waste to the business. Hence the diversification of business was possible due to the enhancement of quality to the business investors. The business manufacturers needed the quality analysis in order to the diversification of business for the satisfaction of business investors and hence the enhancement of quality was the effective one for business diversification.
II. Business diversification strategy
Development of products and services
Develop the right products to meet the target market needs was the strategy in order to make the business diversification with the indication of products and services. This strategy provided the better initiation to the organizational business for the better enhancement. It also concentrated on the products and services of the organization and provided the mitigation for avoiding the business problems in the organization. This strategy also provided the planning, designing for making the particular product and also analyzed the value of services.
The essential resources of business products and services were provided by this strategy and it was also possible to make the extra resources for the business production in the organization. The business diversification was also based upon this strategy and also this strategy evolved the segments of business in order to attract the abroad clients among global level. Major purpose of strategy was that it can help to each step of business diversification in the organization and also supported to the development of products.
The synergies may be gained from the business diversity by the utilization of this strategy. This strategy also promoted the products and services and evaluated the new opportunities in the market in terms of acquisitions, new products and services. It also attracted the markets and managed the financial resources better to make the business diversification in the organization. The determination of unique strength of business was also possible due to the implementation of this strategy in the organization.
III. Identification of foreign market
The foreign market was the one that carried out by the organizations and this strategy used an extension of the techniques in the home country of a firm. This foreign market referred to the firm-level across the border including market identification and targeting, entry mode selection, marketing mix, and strategic decisions for competing in international markets. It was the multinational process of planning and executing the conception, pricing, promotion and distribution of ideas, goods and services for creating the exchanges that satisfied the individual and organizational objectives. The international marketing strategies were developed by the various multinational companies on a global level in order to setting a common brand for their products and brands (Justin Paul, 2008).
Strategies for entering the markets
Preparing an export plan was the strategy in order to entering into the global market. This strategy focused the strengths, weaknesses, opportunities and threats of the organization that will be mitigated by this strategy in order to make the organization at the global level. This strategy provided the right tactics and methods to the organization in order to entering into the global market. This effective strategy also provided the capability and status to the organization for getting the highest priority among other organization in the foreign market. The export initiative of an organization will also be satisfied by this organization in order to make the better enhancement to the organization and it will be implemented results in favor of an organization for entering into the global market.
IV. Challenges in the global markets
The cultural nuance was the challenge that faced by the organization when entering into the global market. This cultural nuance was influenced to purchase products by global marketing messages delivered through the media, including magazines and so on. This challenge required the deep understanding of the culture, customs, morals and religious view that predominated in the global markets. The communication was also the challenge to the organization when entering into the foreign market. The business executives from different countries can encounter several barriers to the effective communications in the global market. The global market relationship with the organization will be influenced by this challenge (David Ahlstrom, 2009).
Minimization of challenges
Implementation of attention was the strategy in order to mitigate the cultural nuance. This strategy make the better understanding of culture, customs and moral to the organization in order to mitigate the negative influences of global market. This strategy also motivated the organization in order to ensure into the global markets and also provided the better advertising to global market. The communication style varied in the global markets and this challenge can be mitigated by making the higher value on organization among the global markets and the facial expression also improved the communication style.
V. Scenario for the organization
When the organization was not having the capability to make the quality products and services then it was not possible to make a diversification for expanding into a foreign market. This action led the negative role in the organization and this played on organizational activities negatively.
The lack of quality and resources were the negative consequences of organization and in this situation, the organization would not make sense to diversify into a foreign market. This situation also made the negative roles in the global market that organization canâ€™t get the priority among other organizations and they will be having the less production and services. The financial resources will be very less due to this negative consequence.
VI. Creation of business environment
The business environment of an organization will be enhanced by making the quality products and services in the organizations. The ethical behaviour of the organization can be possible by making the co-ordination among organizational management, better employee-manager relationships, perfect work scheduling in the organization. The organization must reduce the workforce of employees and at the same time organization must make the perfect work environment to the employees in the organization. The ethical behaviour of organization also was enhanced by motivating the employees, delivering effective products and services.
The argument for the diversification of business to the business investors was discussed. The strategy for the diversification of organization in order to indicating the products and services were developed. The identification of foreign market in order to entering the foreign market was also detailed. The challenges to the company when entering into the global market were also included. The creation of business environment to the ethical behaviour was concluded.