A business strategy reflects managerial choices among different alternatives and signals organizational commitment to particular products, markets, competitive approaches, and ways of operating the enterprise. When firms formulate their business strategies, they define their objectives while considering their resources and capabilities.
Additionally, they respond to the opportunities and constraints in the marketplace. Hence, it is important to understand the driving forces of the competitive environment. In this chapter, we will first define the new competitive dynamics by referring to theoretical and practical considerations with some examples. Second, we will review principal international business strategies. Third, we will introduce a new international business strategy model that embraces the significant characteristics of the previous models in business literature.
The new competitive dynamics refer to forces that shape today’s business rivalries. Rapidly changing market conditions (and accordingly, emerging business philosophy) form the new competitive dynamics, which are knowledge-based and global in nature and require continuous improvements in every facet of the value chain and seeking opportunities worldwide. As technology and the globalization of business advance with unprecedented speed and magnitude, firms in almost all industries—traditional and emerging—are engaging in unorthodox competitive modes. This new competitive mode requires product and process innovation, quick responses, and high customer service while