Six primary models of globalization

Going back to the article I mentioned in my previous post, I thought that looking at the six models that were uncovered by this BCG study would be interesting as well:

Model one: Taking RDE brands global
28 of the RDE 100 are growing internationally by taking their established home-market product lines and brands to global markets.

Model two: Turning RDE engineering into global innovation
Twenty-two of the RDE 100 companies are pushing their international clout by marketing innovative technology-based solutions to leverage their strengths in engineering and research.

Model three: Assuming global category leadership
Only 12 companies from the list are growing by establishing themselves as specialists and global leaders in one specific, relatively narrow, product category.

Model four: Monetising RDE natural resources globally
Thirteen of the RDE 100 companies adopt this approach. They leverage their home country’s natural resource advantages.

Model five: Rolling out new business models to multiple markets
These 13 companies are building regional or global portfolios in their respective businesses by rolling out business models that were pioneered in their home markets.

Model six: Acquiring natural resources
In contrast to others, the 12 companies in this category are expanding overseas to acquire vital raw materials for their home markets.


Endpoint

Companies from the rapidly developing economies may broadly fit into one of the six strategies. But there is a rider: while these strategies are distinct in principle, they often overlap in practice.

For instance, while Tata Steel monetises natural resources of its home country, it is also rolling out business models that are perfected in its home country in its acquired businesses abroad.

The RDE 100 also have some features in common. First, all of they build on positions of low cost — a key competitive advantage of rapidly developing economies. Most RDEs are key markets for MNCs. They become training grounds for competing with global incumbents.

Virtually all the companies are adept at learning and adapting. This is what enables them to learn the lessons of established companies. Moving forward, that might be their biggest strength.

Imho, it is the learning and adapting component that leads to their willingness to create global brands that can cross over from their home culture to the new market culture. The crossing over requires a cultural reinterpretation of their core brand values in order for them to be accepted in their target markets. They are willing to assimilate.

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