Howard Perlmutter identified a way of classifying alternative management orientations, which is commonly referred as Perlmutter’s EPRG model. He states that. The aim of this paper is to present the fundamental ideas behind EPRG model . () the essence of geocentric strategy is an uniform approach to all national. To overcome from this problem one should adopt EPRG Framework, ETHNOCENTRIC ORIENTATION: Ethnocentric approach will better suit.
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There are many costs that ethnocentrism can incur on an international organization. A regiocentric organization sees epeg and differences in a world region, and designs strategies around this. Orientation towards international operations approacy a company, approach consider the whole world as one market and hence develops global strategies which are applied in domestic market also.
Such companies do not adapt their products to the needs and wants of other countries where they have operations. The third and last aspect of the EPG model is the geocentric portion, this notion focuses on a more world-orientated approach to multinational management. However, there are certain aspects of the business life in which ethnocentrism and polycentrism are more adequate models to follow, but functional smoothness and success in both home and host countries is dependent upon upper managements ability to select individuals who are world orientated as opposed to home or host country centered.
The term multinational company is often used to describe such a structure. They possess a strong regional identity. The first drawback of a polycentric approach is that the “benefits of global coordination between subsidiaries such as the development of economies of scale cannot approcah realized.
This does not equate superiority with nationality. When company is small and is not in position to invest heavily in overseas operations, it is better for it to identify countries which have characteristic similar those of home country and export to them.
This framework addresses the way strategic decisions are made and epgr the relationship between headquarters and its subsidiaries is shaped.
Ethnocentric attitudes can be seen in the organizations communication process.
Therefore, knowledge that could be beneficial across all regions is lost, and subsidiaries could be worse off than if they had obtained the knowledge. Management is apprach to have total control over the company in the host country because it is found that “local nationals have a better understanding and awareness of national market conditions, more so than home office personnel. These policies entail high cost.
In contrast, polycentric organizations or managers see each country as unique, and consider that businesses are best run locally. Often there are major differences between countries in a region. This page was last edited on 10 Novemberat In these companies, opportunities outside the home country are ignored. After completing my post graduation I thought to appgoach a website where I can share management related concepts with rest of the people. He states that businesses and their staff tend to operate in one of four ways:.
EPRG – INTERNATIONAL MARKETING ORIENTATION – Priyanka Blog Thoughts
Home standards are applied to the evaluation and control of the organization. A polycentric approach should only be used within a company in which there is a certain amount of comfort in allowing the host country to make all major decisions, following their own procedures and objectives.
This is because it does not need to send skilled managers out to maintain centralized approacn. This article is written like a personal reflection, personal essay, or argumentative essay that states a Wikipedia editor’s personal feelings or presents an original argument about a topic.
While there are many obstacles that will hinder a company’s ability to ap;roach geocentric, there are also a handful of forces which will drive them towards this. There is often ineffective planning due to poor feedback from the international subsidiaries. These orientations reflect the objectives of a company towards approoach operations and to lead to different management strategies and planning procedures.
The importance of the EPG model is mainly in the firm’s appproach and understanding of its specific focus. Since not much investment is made in overseas operations so if loss may occur then firm can absorb shock without much difficulty.
International Marketing – EPRG Framework
In this context, ethnocentrism is the view that a particular ethnic group’s system of beliefs and values is morally superior to all others.
I hold a degree in MBA from well known management college in India. To overcome from this problem one should adopt EPRG Framework, which identifies four types of orientation towards internationalisation of business operations —. Besides these, it has other advantages such as the possibility of knowing the customer better and maximum degree of marketing orientation. Companies should evaluate all legs of the EPG model before implementing a strategy, as all companies differ in international strategy among industry and region.
There is no international firm today whose executives will say that ethnocentrism is absent in their organization. Not only is global trade is growing at healthy rate, but techniques of overseas marketing is also becoming more diversified and sophisticated.
EPG model – Wikipedia
Views Read Edit View history. Instead, management selects the person best suited to foster the companies goals and solve problems worldwide. For example, countries appfoach Pakistan, India and Bangladesh are very similar. Orientation towards international operations by a company, which consider each market differ from other and hence applies different technique in different market.
The major advantages of this Type of orientation is that it entails minimum risk on the part of the firm. What is accepted as a permissible way of treating employees in the United States, the home country, may not be acceptable to Chinese employees, in the host country.
Please help improve it by rewriting it in an encyclopedic wprg.