Professional Documents
Culture Documents
The AAA Triangle framework: This framework aims to help companies decide on the
most appropriate overall strategy for creating value through international expansion.
Adaptation
Adaptation focuses on ‘localization’ –
tailoring products or business models to
the preference of the local market.
Companies with this strategy often
develop products customized to the
specific country.
Aggregation
Aggregation focuses on
‘standardization’ creating or utilizing
Arbitrage
existing economies of scales across
Arbitrage focuses on ‘exploiting’ differences
multiple locations. Companies with
between locations for the benefit of the whole
this strategy tend to leverage already
organization. Production cost is the most typical
established products or expertise, and
example – e.g. having factories in locations with
market them to the new location
lower raw material and labor cost.
through active advertising.
Bharti Airtel
Cut and paste model: A global brand positioning and a cut and paste attitude
They got a very poor asset. Zain had not invested much in key things such as
brand and network, which made integration more difficult
Bharti decided to sell the four subsidiaries in Burkina Faso, Chad, Congo
Brazzaville and Sierra Leone to fund its Nigerian subsidiary
Poor distribution model: They dropped Celtel’s distribution which was proving
effective and went for the Indian model of micro distribution.
Impatience: Airtel has had seven CEO’s in the last 11 years while their
rival Safaricom has had only 2 in same period.
Abnormal salaries: Airtel company pays the highest salaries across Africa-the
salaries are above market prices
Mahindra & Mahindra
Founded in 1945
Joint venture with International
Flagship company of US$ 3 Billion
Truck and Engine corporation of
Mahindra Group
the US and the Renault Group of
Two operating divisions
France
Automotive Division
Farm Equipment Division
World’s largest selling tractor
It also has defense system division
brand
Entered in 1994
USA
Product Localization – 18-105 HP
Portfolio
tractors
Korando Rexton
Rodius Tivoli
Reasons for International Success / Failure
Mahindra USA ranked among the Top 3 manufacturers in overall
dealer satisfaction
Led the competition in
Marketing and advertising support
Product Technical support
Warranty Payments
Return Privileges
MUSA targeted a smaller agricultural niche and coupled it with
personalized service