International business case study

Question 1

What is the nature of Whirlpool's domestic and international business environments? What types of risk does the firm face?

The nature of the domestic and international business environment of Whirlpool is highly competitive in nature. There are a number of opportunities to make a mark with the type of product that is more preferred at a certain place but at the same time the level of risk involved sees no bounds. The company feels that this competitive environment has a single solution of internationalization. Hence, the company has not only expanded its business in USA but it has also gone a huge leap forward in making a mark in countries like Bulgaria, Hungary, Russia, Slovakia, Russia and also Czech Republic. In India, Whirlpool has made a name for itself. The company has come up with a variety of products so as to suit the dynamic environment at both local and international levels. But as we know, a larger return would only come from a bigger risk, there are also various amounts of risks associated with the company's proceedings. The company was forced to invest lesser in the research and development in some of the lower-cost locations. This can be an advantage for the new entrants. Other than this, the company had to face declining sales in USA with its expansion strategy as the focus on the home country shifted elsewhere. The threats from competitors to the country are also ever-increasing. The reason for the same is that as Whirlpool is expanding its market to Asia as well, companies like Haier are giving it immense competition. So, there are chances that the company's cost of investment in these countries might not reach break-even as predicted. These are some of the vital risks that Whirlpool is associated with in its international expansion program. The customers at home feel the of-focus strategy and those international are already influenced by settled companies. (internationalization, 2010)

Question 2

How can Whirlpool benefit from going international? What types of advantages can the firm obtain? What advantages acquired abroad can help management improve Whirlpool's performance in its home market?

With the intensity in domestic competitions increasing, there are chances for a lower profit margin from the perspective of the company. Under the situations, the company has the options of going international. The reason for the same being that there are many countries like India, Italy etc where the demands of the people are highly satisfied with the different variety of products and services that Whirlpool provides. The advantages that the firm can obtain form going international are that with the fall in trade barriers, growth of consumer affluence, and also flourish of capitalism, the company can reach to the depth of diversification. The company has also succeeded in making international successes as well. Whirlpool has already acquired the appliance business of Philips in the European continent, a 65% acquisition of the Italian cooling compressor Aspera. The company has also purchased the second largest appliance maker in Poland. The company is also making an effort to make a mark in China by having a joint venture with China. These plans have extended to countries like Mexico, Latin America and India as well. There are certain European countries which have already been mentioned where Whirlpool is conducting its marketing campaigns for a growth in international sales. The company has also made integration with the international subsidiaries. This is with respect to appliance technology, production, distribution and other operational activities. These can all be shared so as to be able to use the best quality of production that the company can provide. This aids in customer atisfaction.

Question 3

What actions has Whirlpool management taken to ensure that the firm succeeds in local markets throughout the world? To what extent is the appliance business local/regional rather than global?

The company has ensured the fact that even the research and development teams from cross regions are able to collaborate for the best of local success everywhere there is a production house of Whirlpool. In fact the firm is an example of revival after declining of sales in the home country and then using an optimization in cost structure. The company has made international success by reducing the expenses. This has lead it to make higher profits and make a challenging position in front of the competitors in the world. In spite of the fact the customers targeted by the company are of diverse culture and economic backgrounds, the company have been able to make incessant success throughout. The firm has provided the attributes of sensitivity and commitment to the customers worldwide that has raised the chances of success for the future. As far as specific countries are concerned, Whirlpool has provided, Italians with a line-drier system for clothing, Holland with a spin drier system, different capacity refrigerators for all, meat-storing capacity for Spain, well constructed units for England, food storing capacity for France, providing environmental features for Germany, high-level cleanliness washing machine for India and also other electronic means in countries like China. As far as the appliance business is concerned, it is more local than global. The reason for the same is that every product that Whirlpool manufactures has a local significance in some area or the other. As we have already seen the different varieties that the country provides in the different regions, the sales of a variety preferred in one area would never be the same in another if not preferred. So, the company is forced to have a local/regional appliance system. (Globalization, 2010)

Question 4

how can Whirlpool effectively compete with new rivals originating from low-cost countries, such as Haier from China? Should Whirlpool's response differ in its home and foreign markets? If so, how?

Out of the three different base strategies that Porter had coined, it is advantageous for Whirlpool to undergo the cost-leadership strategy. The reason for the same is that Haier has already established itself in the market. As Haier is already in the growth stage in many countries, the only way that its competitiveness can be challenged is by having a lower cost as compared to the others. It is also required at this stage that Whirlpool's HR management strategy is improved considering the fact that Haier has made a number of options for new jobs in its South Carolina factory. At this stage, Whirlpool is required to get a better financing activity so that it can meet the challenges posed by countries like Japan and even those in Europe. The country would also have a trade-off between the risks and rewards associated with Globalization. Rather than simply looking for opportunities ahead with Globalization, Whirlpool should also look for the drawbacks that the lost-cost countries pose for them. As discussed above, the strategies that Whirlpool should follow for home should be different from what it follows for outside countries. As the demands for the products manufactured by Whirlpool are different in different countries, the strategy can certainly not be the same. Even, the type of competitors are different everywhere. The strategy to fight the low-cost producers would be different as compared to that with the new entrants. As the situation is, Whirlpool has to fight accordingly. The firm should ensure that it enjoys all advantages of international business but at the same time beware of the disadvantages as well.

Question 5

The "Careers" section at Whirlpool's website (www.whirlpool.com/) advertises "opportunities you never knew existed . . . everywhere across the globe." Visit the site and report on the types of jobs available at Whirlpool and the locations of these positions worldwide. What positions interest you most? Would you like to work in Whirlpool's international operations? Why or why not?

The diversity in Whirlpool's career opportunities are of the same order as the different variety of products that they produce. This includes the field of brand Market Operations, Engineering, Finance, Global Custom Design, Human Resources, Manufacturing, Procurement, Supply Chain and many others as well. The company promises a career in these positions once qualified in some of the well-developed countries of the world. The countries include- Bulgaria, India, Hungary, China, Russia, France, Germany, Czech Republic, Great Britain, Slovakia, Russia and also USA. These are some of the countries that every aspirant in the world wishes to visit at least in his life time. So, the prospect for any candidate is high with respect to his career. The reason for this massive work structure is the diversity and the international expansion that Whirlpool has undergone in the past few years. As far as I am concerned, the position of an official in Brand Market Operations suits me the most. The reason for the same is that the way Whirlpool itself in the past is really appealing. The company after seeing a decline in the prospects in USA went onto the other countries worldwide so as to make a mark. The branding was done in such a way that the company's offerings were highly distinguishable in all the places with different entities. Yes, I would certainly like to work in Whirlpool's international operations. The reason for the same is that with the effect of Globalization, brand management has now become an international issue. In order to make the best understanding of the same, one would need a company of the scale of Whirlpool. This would certainly brighten my future. (Better Brand = Better Market Performance, 2010)

References

  1. Internationalization, (2010) Retrieved on 29th March, 2010 from http://whatis.techtarget.com/definition/0,,sid9_gci212303,00.html
  2. Globalization, (2010) Retrieved on 29th March, 2010 from http://www.globalpolicy.org/globalization.html
  3. Better Brand = Better Market Performance, (2010) Retrieved on 29th March, 2010 from http://think-tank.ie/better-brand-better-market-performance/

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