Question

Chosen Multinational enterprise (MNE): Facebook

Question 3

1. Based on your understanding of the topics, Strategy and Structure of MNEs and Entering Foreign Markets, analyse strategy and entry mode choices your MNE adopted as it entered and operates in the host country. Evaluate the benefits and pitfalls of the company’s decisions.
2. If you were given the responsibility of managing your chosen MNE’s operations in your selected host country, what additional or alternative actions would you undertake? Provide justifications for your answer.

Answer with depth

Answer 1

INTRODUCTION

About the company - Facebook is a multinational corporation headquatered in California. It spreads and maintain a vast social network with massive user supplied content, gaming, audio and video,mobile application and providing with advertising platform. It is owned by Mark Zukerberg. It is considered one of the five biggest technology along with Apple, Google, Amazon and Microsoft.

Facebook strategy includes the following

1- Market penetration - The main reason behind the company's growth is market penetration, the objective is to maximise its current market share, this in turn support the company competitive strategy by maximising amrket.

2- Market development - This is the second strategy for the business growth the main object of this strategy is to enter the new market. The company's mission and vission statement focus on growth through global markets which in turn maximize the market effectiveness.

3- Product development - This is one of the supporting growth strategy used in social media business, it involves offering new products and also helps in influencing 4ps or the marketing mix , the competitive strategy maximizes its profit margin with intensive growth strategy.

4- Diversification - The company uses diversification as the support intensive growth strategy, and the main objective of the growth strategy is to establish new business.

The company's organisational structure consist of the following level.

1- CEO (Chief Executive Officer)

2- COO (Chief Operating Officer)

3- CFO (Chief Financial Officer)

4- CIO (Chief Information Officer)

5- CPO ( Chief Product Officer)

The following are the foreign market entry analysis strategy of the company

1- Licensing- Under this the firm transfer the right to use its product and services to another firm.It can be used to marketing its product and services.

2- Franchise-This process is a market expansion process by gaining fraction in other parts of the world.

3- Joint venture - Under this two companies jointly agree to work together in a market for a common onjectives

4- Buying a company- In some cases it is useful to buy the local old company in order to the particular market of that country.

The benefits and pitfalls of the companies decision -

Advantages -

a- Increased reveneues- It result with the increased revenues of the company through increased in the e commerce business and its scope-

b- Brand awareness - This serves as a great platform in creating the brand awareness by expandinf its reach to the foreign markets.

c- Referrals - this can be achieved only through its market expansion through foreign markets

d- Social Influence - The generation is getting more and more influence through the social media influence through its increased market.

Pitfalls-

a- Increased risk factors - Although the company is providing with its great privacy policy the users are exposed to risk in terms of the privacy factors.

b- Increases cyber crimes- Now a days with the growing technology the cyber crimes rates are rapidly increasing with every passing days.

[B] If i have been given with the responsibility to manage my choosen MNEs i.e Amazon The following alternative action I would undertake

1- Improved and Effective communication flow - As past few cases heard about the complaint that the company is lagging in flow of communication of its customers complaints so in order to eliminate it i would further try to infuse the effective flow of the communication syatem so that the customer can conveniently contact for their concern and feedback.

2- Customer centric approach - The foremost thing required for the company's unrestricted growth is the customer centric approach the company need to first focus on its customer satisfaction rather than any profit centric approach in order to enhance its expansion of its activities because only a satisfied customer can helps your business to grow to new heights.

3- Quality service - The company must not only provides its customer with the required service but also try to add quality to its services so that the customer at the end remain satisfied with the services provided by the company. Quality of the services will itself define the company among new customers.

4- Introduce new innovative technology - The most important factor in the management of any company's operation keep it up to date with introducing new and innovate technology which in turn helps in enhancing the companies productity not only in terms of profitability but also in terms of customer satisfaction.

5- Lowering its operation cost - The company in order to enhance its productivity need to reduce or lowers its operation cost so that it can achieve maximum output through minimum input cost which itself will improve its market share and provide and effective place in the economy.

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