Why resources are a major concern in global strategy

Resource scarcity in global business

Question:

Why should resources be a concern in a global strategy?

Resources are the major concern of the global business. Without the help of the resource, the companies can never produce any product nor provide any service. In this global context when one company enters the market of another country, they are to be abiding by some very essential laws and regulations of that market so that they can operate easily without any problem. In this case, the textile company produces high quality product which is their uniqueness (Cavusgil & Knight, 2015). In case the company enters other market, it may not get the needed resources for the production of the textiles. There can be problems regarding the resources like fund, materials, workers and raw materials for the successful production of the fabrics.

What resources may be a concern in the country you selected?

In the new market of China which the company has chosen for entering, may not provide all he needed resources which the company gets in its home country. The market of China provides a huge quality of labours which are of cheap quality, but the company may face problems regarding the skills of these cheap labour. Secondly the resources in arranging raw material for producing their high-quality fabrics may not be available in Chinese market that can affect the reputation of the company (Cui et al., 2017). Thirdly, the capital or investment in the Chinese market for this company may not be up to the mark. In addition to this the buying capacity of the people and transportation in the new market may be important factors in China. Finally, the factor of suppliers concerns the company regarding arranging resources in China.

How will this impact the decision to move to the country that you selected?

The decision of global strategy is dependent upon the external and internal factors of the market into which the company is deciding to enter. The unavailability of the raw material in Chinese market can effectively hamper the high quality of the products for which this company is so much popular. The decision to expand in the huge market of China is welcoming as there are superb infrastructure, cheap and skilled labour and good transportation system s present but the other resources like the availability of the raw materials which will be used in the production process may not be up to the expectation of the company (Noe et al., 2017). In addition to this the organisational culture is also different from that of the home country which may lead the marketing team to think to expand the company in different market other than China.

How will this impact your competitive strategy in your global market?

This concern for arranging resources can impact the competitive strategy of the firm negatively. This is due to the fact that the unavailability of the raw material as per the requirement of the firms can force it to compromise the high quality of production. This therefore affect the competitive strategy, or the long-term plan set by the company. This can also create barrier in creating defensive positive in the textile industry and generating the superior ROI or return on investment (Hotho, Lyles & Easterby?Smith, 2015). In the global market the company therefore will not be able to expand as this cannot always abide by the laws of utilising local employees, material and suppliers.