Page 74 - DMGT547_INTERNATIONAL_MARKETING

Unit 3: Political Environment of International Marketing

as envisioning is concerned, it has to be confined to senior management. This raises a Notes
second crucial issue: is there a need to document strategy? Personally, I feel that the
strategy of a company should not be documented. Only then will it ensure confidentiality.
As Strategic Consultants’ approach points out, strategy should be confined to a handful at
the top. It can never be an across-the-board initiative…
That is the way I feel too. But I am open to both opinions although, I must confess, I am
unable to decide on which one to follow. I am aware that some companies link strategy to
vision, but this linkage has not been well documented. Strategy should be based on the
realities of today; not the dreams of tomorrow. We have to make sure that we do not
become the guinea pigs for a strategy-formulation exercise.
Questions

1. Is there a need for a strategy at Auto Components? Does a small company operating
in a predictable environment need to formulate one? Can approaches to strategy be
so conceptually different?
2. Should Abhayankar go by gut feel and, by using in-house talent, do what he believes
is right for the company?

3. Instead of spending time on documenting a strategy, shouldn’t Auto Components
just have an informal plan of action, governed by the intuition of its senior managers?
4. Since the company has a team which knows its business better than any consultant,
why should Auto Components bank on external ideas? Should strategy ever be
documented?

Source: P K Vasudeva, International Marketing, Excel Books.

3.6 Summary

This unit attempts to give an overview of the functions in as simple manner as possible.

Developed countries are also quite concerned about foreign direct investments. For
example, the citizens of many nations pressurise the companies of their countries not to
invest in South Africa because of that country’s apartheid policy.

Companies can derive positive economic benefits when the relationship between two
countries improves or when the host government adopts a new investment policy. As in
the case of India, the country was highly regulated, closed economy, which discouraged
foreign direct investment.

In order to appraise the political environment of a country, the knowledge of the form of
government of that country is essential. The absolutist governments include monarchies
and dictatorships.

Political system of many countries does not fall neatly into these two categories. This
classification results in four types of governments: two party, multi-party, single party
and dominated one party.
In a two party system, there are typically two strong parties that take turns in controlling
the government although other parties are also allowed. The United States and United
Kingdom are classic examples of two party systems.
The two parties have generally different philosophies resulting in a change in government
policy when one party succeeds the other. In a multi-party system there are several political
parties none of which is strong enough to gain control of the government.

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