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In Brazil, thousands swarm daily from preindustrial Bahian darkness into exploding coastal cities, there quickly to install television sets in crowded corrugated huts and, next to battered Volkswagens, make sacrificial offerings of fruit and fresh-killed chickens to Macumban spirits by candlelight.ĭuring Biafra’s fratricidal war against the Ibos, daily televised reports showed soldiers carrying bloodstained swords and listening to transistor radios while drinking Coca-Cola. Who can forget the televised scenes during the 1979 Iranian uprisings of young men in fashionable French-cut trousers and silky body shirts thirsting for blood with raised modern weapons in the name of Islamic fundamentalism? Modernity is not just a wish but also a widespread practice among those who cling, with unyielding passion or religious fervor, to ancient attitudes and heritages. The same countries that ask the world to recognize and respect the individuality of their cultures insist on the wholesale transfer to them of modern goods, services, and technologies. Worldwide communications carry everywhere the constant drumbeat of modern possibilities to lighten and enhance work, raise living standards, divert, and entertain. Which strategy is better is not a matter of opinion but of necessity. The global corporation operates with resolute constancy-at low relative cost-as if the entire world (or major regions of it) were a single entity it sells the same things in the same way everywhere.
The multinational corporation operates in a number of countries, and adjusts its products and practices in each-at high relative costs. The multinational and the global corporation are not the same thing. With that, the multinational commercial world nears its end, and so does the multinational corporation. And gone are the days when prices, margins, and profits abroad were generally higher than at home. Gone are the days when a company could sell last year’s models-or lesser versions of advanced products-in the less-developed world. Gone are accustomed differences in national or regional preference. By translating these benefits into reduced world prices, they can decimate competitors that still live in the disabling grip of old assumptions about how the world works. Corporations geared to this new reality benefit from enormous economies of scale in production, distribution, marketing, and management. The result is a new commercial reality-the emergence of global markets for standardized consumer products on a previously unimagined scale of magnitude. Almost everyone everywhere wants all the things they have heard about, seen, or experienced via the new technologies. It has made isolated places and impoverished peoples eager for modernity’s allurements. It has proletarianized communication, transport, and travel. Only global companies will achieve long-term success by concentrating on what everyone wants rather than worrying about the details of what everyone thinks they might like.Ī powerful force drives the world toward a converging commonality, and that force is technology. Multinational companies that concentrated on idiosyncratic consumer preferences have become befuddled and unable to take in the forest because of the trees. In this powerful essay, the author asserts that well-managed companies have moved from emphasis on customizing items to offering globally standardized products that are advanced, functional, reliable-and low priced. How can they customize products for the demands of new markets? Which items will consumers want? With wily international competitors breathing down their necks, many organizations think that the game just isn’t worth the effort.
Many companies have become disillusioned with sales in the international marketplace as old markets become saturated and new ones must be found.
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