Era of Liberalization and Globalization

The strategy is implemented through a relevant organizational structure. This essay discusses the historical development of international business briefly, outlines the terms ‘strategy’, ‘organization structure’ and ‘competitive advantage’, and examines the relationship between strategy and organizational structure for sustaining international competitive advantage in this era of liberalization and globalization.
In the beginning, international business was largely confined to trading – raw materials, agricultural products, and manufactured goods. Such activity was substantially expanded during the colonial era, with the active participation of the governments. In the twentieth century, it has metamorphosed into the strategic global business activity of expansion for exploiting newer opportunities and sustaining competitive advantage.
for such development were economic in nature like the relative profitability of expanded operations (overseas markets may be more profitable), exploiting new opportunities (local market may be saturated), availability of raw materials and man-power at more economical costs, etc. With the active promotion of free trade by the economically developed countries, multinational companies have started adopting global business strategies, instead of just being multi-location ‘national businesses’. As stated by Schell, “Globalization should mean the adoption of a global strategy” (Schell, 2006, p.4). Thus, globalization is much more than doing business in different countries. it is recognition of the need for a strategically different approach to doing business, be it in localizing the product or organizing the process or managing the environment or reorganizing the structure of a company. Acquisitions, cross-border mergers, strategic alliances are all different aspects of globalization. Each of these approaches or a&nbsp.&nbsp.combination thereof is followed as a deliberate winning strategy.