Four basic strategies to enter and compete in the international environment: (1) global standardization strategy, (2) localization strategy, (3) transnational strategy, and (4) international strategy. Each of these strategies has advantages and disadvantages. The appropriateness of each strategy varies with the extent of pressures for cost reductions and local responsiveness. A firm must balance the pressures for cost reductions with the pressures for local responsiveness. In order to customize products to respond to local demands, the firm may have to give up some of the potential cost savings. Also, the firm may not be able to fully leverage its distinctive competencies.
As part of your development as a new member of IKEA's Retail Division, you have been charged by Andres Moberg to with identifying key strategic issues facing the company in the next 10 years, and to recommend an action addressing each issue. Your list of strategic issues and proposed strategic action plans should be presented in an appropriate executive summary format and not exceed three pages in length.
Additionally, while Moberg realizes that he has had some success using their current global strategy, he is interested in conducting a "what-if" type of analysis for using alternative strategies for IKEA. Moberg feels that the best strategy is not always obvious, and thinks that the best way to fully evaluate his future strategy is to attempt to formulate a concept paragraph for each basic type of global strategy for IKEA., then to see which strategy has the best "fit." To accomplish that "what if," he wants you to prepare a concept paragraph for IKEA outlining what differences would be required for IKEA's strategy and operations to compete effectively in each of the following global strategies: global standardization strategy localization strategy transnational strategy international strategy