International strategy operation Coursework Example | Topics and Well Written Essays - 1250 words - 2

International strategy operation - Coursework Example As a small-scale company in Austria, AGRANA had to compete with other larger and similar companies. Prior to 1989, AGRANA encountered a lot of business challenges before it was able to successfully compete in the global markets. Regional integration is referring to the process in which companies located in different regional states are actively interacting with one another in order to promote both economic and political security1, 2 whereas global integration is pertaining to the process in which the company is able to benefit from the act of combining the different business activities that are located in different countries around the world3. Through regional and global integration, AGRANA was not only able to gain benefits from economies-of-scale but also created more competitive advantage. Ever since the CEE decided to open its market to other regions and in the world market, the scope of AGRANA’s target market also increased significantly. Through foreign direct investment (FDI), AGRANA took the opportunity to expand its manufacturing plants in different regional and international sites4. Since AGRANA was selling homogenous products, its target buyers can easily purchase the same item from other companies. Back when the scale of AGRANA was small, the bargaining power of its buyers was high. Therefore, the company was determined in searching for ways on how they can effectively cut down its operational costs without sacrificing the quality of the products. To compete in the market, the company had no other choice but to improve its marketing and production strategies to create cost and differetiation advantages5. It means that through product differentiation, market segmentaion, the use of generic strategies, and continuous reduction in the actual fixed costs of the busienss6, AGRANA was able to keep up with the tight market competition. For example, instead of