|6 Min. Read||Dominic Dithurbide||May 02, 2022|
As a company considers expanding to new markets, international business strategies must be put in place for that plan to be effective. This is the first installment of an international business strategies series that will take a deep dive into international, multi-domestic, global, and translational strategies used to target new markets within international borders.
All the strategies mentioned above require a specific level of commitment around four main factors. Those factors are local responsiveness, global integration, standardization, and customization.
Local responsiveness refers to a company that localizes its products and services to meet conditions and nuances in other countries.
Global integration refers to how a company markets and uses the same products and services in other countries.
Standardization refers to how a company does a “one size fits all” for the same products and services in other countries.
Customization refers to the process through which a standard message, procedure, or offering may be adapted according to the context or market in which it will be used.
A transnational strategy leverages a high level of local responsiveness and a high level of global integration in its operations. It tries to localize its offering to each global market while also standardizing as much as possible. The goal of transnational strategies is to offer customized products and services for local markets while also keeping a high degree of standardization to benefit from economies of scale.
Transnational strategies typically involve large companies with different subsidiaries, branches, or offices across multiple global markets. The challenge is determining what stays the same across all global communications and procedures vs. where adaptations from local subsidiaries in global markets are adjusted or allowed. Finding the right balance between local responsiveness and global integration is going to be unique for every organization.
Companies spearheading a transnational strategy know when to allow global branches to adjust and make customizations and when not to. This means having clear directions on all international activities and operations.
There are several international business strategies to compare, here are a few examples:
A transnational strategy is commonly used when organizations confront cost pressures from global competitors. Standardization creates cost efficiencies, which help companies increase profit margins to benefit from economies of scale.
However, transnational strategies are hard to plan, execute and grow because companies must create profitable efficiencies through standardization without constricting global subsidiaries from adapting to local preferences. That’s not easy.
Companies using this strategy typically have a head office that centralizes operations and overlooks all international subsidiaries. The degree of autonomy each subsidiary has is determined by the head office and varies from company to company.
Transnational businesses must operate through an organized network of subsidiaries across multiple countries. Each subsidiary needs to understand its local customers’ preferences and combine the resources provided by the head office to adapt products and services to local preferences.
With a proper transnational strategy, multinational corporations can leverage the benefits of standardization without sacrificing local responsiveness in different countries. They operate at a high level of communication, knowledge, and productivity to meet strategic objectives across various markets.
It’s crucial to understand that the strategies that may have worked in one market (or company) may not be successful in another. The more agile and receptive you are to buyer tendencies in different regions, the faster you can implement changes.
In a digital world, a successful transnational strategy can be even more challenging as international companies juggle multiple websites and digital experiences in different languages. When websites, mobile apps, or portals are in the mix, it’s hard to both standardize and customize content in different languages. That is where translation technology can help.
The right translation services can instantly standardize messaging across all markets while also allowing the ability for local branches to customize certain elements (web pages, promotions, offers) in different languages. With effective translation technology, plus an effective transnational strategy, companies can rapidly reach their international business objectives.
There are many approaches to start executing a successful transnational strategy—developing new brands, investing in localized marketing campaigns, and testing new products are some examples. But regardless of your go-to-market strategy, your company should seek to pursue robust translation workflow processes and high translation quality. Efficient communication will play a significant role in your success.
Global organizations provide online information to international customers, suppliers, distributors, and partners. It’s important not only to translate these resources but to localize them to the dialects used in different regions. Learn how localizing your website is essential for your transitional strategy.
Once you have identified your approach to a transnational strategy, MotionPoint’s unique translation technology can help you reach the level of scalability and efficiency your team needs to stay competitive in an evolving, global market.
Connect with one of our translation and localization experts today—we’ll help your team design a solution that can help your organization become a preferred brand, no matter where you operate.