Reactive and Proactive Global Challenge Term Paper

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For example, outsourcing to take advantage of lower labor costs is a frequent proactive expansion technique. Even if a company is not in 'trouble' financially, proactive expansion is a good sign of a forward-thinking management determined to seek out opportunities. Many telecommunication firms, including Verizon have taken advantage of the educated, English-speaking yet far cheaper labor force in India. They have employed members of that nation to staff the 'call centers' that people call for support assistance in using the company's products. While reactive expansion may be more common, given that it can be difficult to take a risk when things are already going well, proactive and informed decisions to expand tend to have a better success rate.

Of course, companies are seldom driven by a single set of factors. For example, Starbucks was largely seen to have 'super-saturated' many areas of core coffee demand within the United States when it reactively expanded its operations abroad.

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However, it also proactively wished to take advantages of international opportunities such as interest in American culture in Japan and other areas of the world. "Starbucks Corp. already has turned much of North America into a Starbucks Nation… even though Starbucks is not the ambassador of American policies, it remains a symbol" in both a positive and negative fashion of the U.S. (Jung 2009). Starbucks wished to reactively establish a loyal customer base abroad before its competitor organizations within the coffee market were able to do so. It proactively took advantage of a unique strategy of partnering with local businesses that understand the regulatory and marketing climate of the different nations Starbucks entered as part of its expansion strategy......

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