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What Is a Global Strategy?

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  • Written By: Whitney Leigh White
  • Edited By: E. E. Hubbard
  • Last Modified Date: 19 August 2016
  • Copyright Protected:
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    Conjecture Corporation
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Businesses create and develop strategies so that operational efficiency can be acquired and maintained. For those businesses that operate or wish to operate on an international basis, a global strategy is usually developed and implemented. This type of strategy usually includes ways to address a business’ learning processes, its efficiency tactics, and its ability to be flexible. There are several factors that affect the creation and implementation of a global strategy, which is used on both micro and macro levels.

The purpose of a global strategy is to improve a business’ efficiency, learning, and flexibility capabilities, thus, enabling it to effectively operate on an international basis. Many businesses find they have a hard time addressing all three of these areas at the same time, making it very important for this type of strategy to be as detailed as possible. When a business cannot address these areas effectively, many times, it will discover it can only survive domestically. When it comes to addressing learning processes, businesses find it imperative to create a global strategy that takes notice to national differences.

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Laws and customs, morals, values, and ethics differ from country to country, which causes these factors to always influence a business’ global strategy. Employees preferred benefits also affect how this type of strategy is developed. Those employed within a certain geographical location will often prefer different benefits than those employed in another location. With so many factors affecting a global strategy, it is easy to understand that developing one often takes a significant amount of time and a large amount of special attention to details.

There are two basic levels of economics: micro and macro. A global strategy is implemented within both levels. When a business develops a global strategy, it does not have to create one for both the micro and macro levels. The strategy that it develops is simply influenced by factors and elements on both levels.

When the strategy is implemented, micro-level factors influence where a business allocates its resources so that profiting opportunities can be taken advantage of outside of its domestic location(s). Many times, deciding whether or not to trade with certain foreign countries is decided upon within a company’s global strategy and this decision is influenced by micro-level factors as well. A global strategy is influenced by macro-level factors such as the taxations and tariffs imposed on a company by foreign countries.

There are many pressures imposed on companies in the 21st century to develop a strategy that can be implemented on a global basis. Businesses are able to provide better customer service when they utilize a strategy that allows them to centralize the development and distribution of their products and/or services by operating globally. No matter what type of business operates on an international basis, a global strategy is imperative so that effective responses can be made to global competitors and their operational tactics.

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