Assalamualaikum.
“Allah does not burden a soul beyond that it can bear…”{surah al-baqarah:286}.
Today I would like to explain about the Diamond of National Advantage which is
a part of this chapter. In order, to craft a strategy tp compete in one or more
countries of the world is inherently more complex for 5 reasons:
1 )Different
countries have different home-country advantage in different industries The
chart below show the diamond of national advantage and this is due to four sets
of factors that can be analyzed using Porter’s Diamond Framework of National
Competitive Advantage.
2)There
are location-based advantages to conducting particular value chain activities
in differ part of the world
3)Different
government policies, tax, rates, inflation rates, and other economic conditions
make the general business climate more favourable in some countries than in
others.
4)Companies
face risk due to adverse shifts in currency exchange rates when operating in
foreign markets.
5)Differences
in buyer tastes and preferences and present a challenge for companies
concerning customizing versus standardizing their product and services.
The important things from this framework are
about the drafting of important question about competing on an international
basis. There are a few questions that helps the organization to compete by
international rivals.
· # Predicting where new foreign entrants are likely to come from and their
strengths.
· # Highlighting foreign market opportunities where rivals are weakest.
· #Identifying the location-based advantages of conducting certain value
chain activities of the firm in particular country.
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