WHETHER TO GLOBALIZE, and how to globalize, have become two of the most burning strategy issues for managers around the world. Many forces are driving companies around the world to globalize by expanding their participation in foreign markets. Almost every product market in the major world economies—computers, fast food, nuts and bolts—has foreign competitors. Trade barriers are also falling; the recent United States/Canada trade agreement and the impending 1992 harmonization in the European Community are the two most dramatic examples. Japan is gradually opening up its long barricaded markets. Maturity in domestic markets is also driving companies to seek international expansion. This is particularly true of U.S. companies that, nourished by the huge domestic market, have typically lagged behind their European and Japanese rivals in internationalization.

Companies are also seeking to globalize by integrating their worldwide strategy. Such global integration contrasts with the multinational approach whereby companies set up country subsidiaries that design, produce, and market products or services tailored to local needs. This multinational model (also described as a "multidomestic strategy") is now in question.1 Several changes seem to increase the likelihood that, in some industries, a global strategy will be more successful than a multidomestic one. One of these changes, as argued forcefully and controversially by Levitt, is the growing similarity of what citizens of different countries want to buy.To read the complete article, login or sign-up using the form below.

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