International_Buisiness

Ques 1 What is the nature of whirlpool's domestic and international business environments' what type of risks they face' Answer1 - In the domestic environment things are fast maturing so the sales volumes are declining and margins of profit are decreasing.There is intense domestic competition so the buyers are also more demanding so whirlpool needs to innovate to distinguish its products form others at least on the domestic front. On the international front a more customised product approach is required in order to cater to needs of specific cultures worldwide. The international trade barriers fell and this provided them with a opportunity to expand globally. As indicated in the case study to counter the effect of less margins domestically and also internationally they need to reduce costs on R& D, manufacturing and services, so expanding to places like china would help in realising this goal. As competition is intense domestically they need to explore and expand internationally to markets where there kind of advanced products which are high on innovation are not available or simply put there is opportunity to expand basis their advanced stature on appliance technoogy, production and distribution systems. So to summarise while it was getting stiff on the domestic front the international world held a host of opportunites for whirlpool. Risks-> Whirlpool faced a risk of non accpetance of its product line in various markets due to cultural differences . This is because people belonging to different countries or cultures have different perceptions and demands from the appliances .This is aptly explained in the case with the example of the washing machines/refrigerators. To counter this risk they spent a whole lot of efort on R& D,starting off with its knowledge management solution in form of the intranet website and also sending diverse groups to various international locations . It also faces risk of canniblaisation of its local markets from other international players like Haier of china which is fast establishing its presence on whirlpool's home ground. Haier already is a strong player in asia which is a key region of emerging economies. Ques 2-How can whirlpool benefit from going international ' what types of advantages can the firm obtain' what advantages accquired abroad can help manangement improve whirlpool's performance in the home market' Whirlpool can benefit largely from goin international by establishing it self as a truly global brand as its advnaced on technology and invests heavily on R& D to cater to the specific needs of international cultures. This will enable it to target international customer base which is very diverse in the USA. In short an italian living in USA will prefer whirlpool's product as they know about its quality and capability to satiate their specific needs.Whirlpool has researched , developed and then standardized product technology which enables it to target mass populations such as the use of hotwash technology to ensure whiteness and max use of detergent in the Indian market. Whirlpool can also save largely on its costs on R& D as its approach is to know directly from the market itself ;the needs of its customers. Labor in various international locations such as mexico, china and india is cheaper so there is a definite saving on manufacturing costs. Whirlpool acuired many local players such as Philips appliance business in europe , entered many new Joint ventures such as in shanghai and subsidaries across other loactions. This enables it to not only capture the market base but also acquire their uniqueness of brand and technoogy , best practices on production etc to its advantage in establishing itself as a global brand. Ques 3 - What actions has the management taken to ensure that the firm succeeds in the local markets throughout the world' To what extent is the application business local/regional rather than global' Whirlpool's management ensured that through collaborative innovation amongst cross regional R& D teams the needs of a diverse cultural and economic customer base are met with .This will ensure that the already high on technology product line of whirlpool will gain acceptance resulting in a high response in the local markets. Whirlpool standardized its technology /distribution expertise by integrating its subsidaries throughout the world and by stressing high on innovation.The ideas of innovation often came from a diverse employee base. Also whirlpool has acquired /partnered local playes to a large extent ,the aim is to target local and emerging markets which have defninite needs based on incomes and which are experiencing growth in income /living standard .