How do companies use global strategy to gain competitive advantage Essay

How do companies use global strategy to gain competitive advantage - Essay Example It has been observed that conducting business in dissimilar regions of the world needs different strategies to be implemented which are to be followed for the better performance of the business. The competition between companies in the global market is quite severe and impacts the performance of the business. In this regard, it has been noted that it is significant for the companies to have a competitive edge over their rivals in order to perform effectively. In the present aggressive business world, every company aims to surpass the performance of other companies in order to build an impressive reputation amid the common people. It has been observed that gaining competitive advantage requires effective planning of strategies and extensive research about the market. In order to have competitive edge, firstly, it is important to understand the potential competition or competitors and their strength. In this competitive business world, it is important to properly manage the business in order to earn maximum success (Scholte, 2005). The essay would intend to present an elaborative explanation on the implementation and the importance of global strategy for operating in the international market. Subsequently, the essay would discuss about how companies can use the global strategy in order to gain competitive advantage in the international market. Global Strategy and Its Reason for Implementation in Business Global strategy can be defined or portrayed as a particular theory that shows about how to compete in the global market through standardisation of product and service on a worldwide basis. It has also been termed as the action plan for the companies to operate in different regions of the world. These are the strategies that are mostly used by big companies in their operations in many countries. It is useful with regard to gaining competitive advantage for the firms over their competitors in the global arena. These strategies are also defined as strategies that ar e developed for outside of own country. It has been observed that the success and failure of firms in their global operations depend on various aspects and global strategies are among them. There are certain key aspects that have to be considered while shaping strategies for global business. The tastes and the preferences of consumers will be differing between countries. The policy and business rules of countries might be at variance and the level of competition will also be different in various international markets. These factors will be crucial in the formation of effective strategies for global business. Furthermore, cost leadership is also among the vital aspect of global strategy. The objective of this strategy is to enable companies to become producer of lowest priced products. In this regard, the crucial technique to attain the aforementioned objective is to produce a large scale of product which facilitates the company to develop economies of scale. This aspect would be a c ritical part of the global strategy of companies in terms of operating internationally. It has been noted that global strategies are effective in gaining competitive edge over competitors in the international market (Peng, 2008). Competitive advantages are termed as benefits a company gains over competitors by presenting greater value to the customers, either through the