Strategic Mistakes: Examples on How global companies go wrong

Although going global might be challenging at early stages for most companies, yet international markets is the ultimate prize for all firms. An international marketing strategy requires firms to adjusts the marketing strategy and elements of the marketing mix to each international target market. Although this means bearing more costs, but looking for a larger market share and return as a result. Because global markets provide wider access to consumer base, and therefore, more revenues, profits, ability to capitalize on variation in consumption behavior and tastes, spending power, income levels, economic growth, varying exchange rates, lower production costs in international markets, availability of new opportunities, access to resources, increasing growth potentials and taking advantage of economization of scale. The disadvantage of going global usually remains in firm’s ability to manage international growth and expansion, or spreading too thin that managing international operations become too costly or difficult. But most importantly, making strategic errors when it comes to international marketing strategies. Now, even the best of companies goes wrong. How do such large, experienced and resourceful companies go wrong? Well, there are number of reasons that includes but not limited to; misreading the target market, wrong assessment of the market segment, misunderstanding of the cultural characteristics of the foreign market that are crucial to the success of international strategy, wrong assessment of competition and the competitive environment, lack of swift responsiveness to changing consumer demand, failure to forecast market conditions, failure to predict changing directions in firm’s own industry, failure to understand the impact of emerging technology on firm’s own business model, failure of evolution in firm’s business model, failing to innovate, failing  to make a leap into new business or industry, and many other foreseen to some while unforeseen to others. Additionally, from my experience in the industry and as an academic and business consultant, in addition to the reasons stated above, companies tend to fail to remain close to their customers and markets. Since organizations primary DNA is made of people, the human factor, along with culture remain the most important elements in decision making. This is in an era of pre-artificial intelligence (AI) decision making. Till we see the day of an efficient and effective “AI” lead and driven organizations, the human factor remains to be the primary one in shaping corporate decision making, large and small.  After all, human beings are subject to making mistakes. Corporate strategy or elements of strategic decisions taken by one or few people within the firm can significantly impacts firm’s position in the marketplace, and or existence all together in the long-run. Everybody makes mistake, large multinationals are no exemption to the rule. This body of work attempts to examine in a brief and concise manner the historic strategic errors that caused companies to exit markets, fail in markets, fail as a brand or fail as a company all together as in the case of Blockbuster Entertainment, Kodak and many other companies that either they were sold or taken over. 

High operational cost, inefficiencies, General economic environment, failing to understand local consumption patterns, and competitive forces, are among the most important factors affecting success of companies in international markets. 

The idea behind this book, started when I was teaching my MBA students in various countries the topics of strategic management, international marketing and international business strategy. While students, which many of whom were business executives, insisted on learning how to implement the “right” business strategy to the right situation, the notion emerged as let examine how the big go wrong, and attempt to learn by deriving patterns and lessons. This body of work was meant to be concise in nature, short and to the point, whereby business students and practitioners would quickly get familiarized with the company, and where they went wrong.