Strategic Plan for Starbucks

“A firm that is considering doing business abroad must have a rationale and logic for how it can compensate for and overcome the liabilities and disadvantages that arise from its foreignness” (Marcus, A.A. 20011), there are many issues that are likely to arise in a developing country when a global giant like Coca-Cola begins operating there, among them are things such as cultural and language differences, a lack of understanding of the domestic market and business conditions, distribution channels may be missing or inadequate, economic imbalances, insecurity, youth violence and government incapacity. “By 2020 there are expected to be more than 30 mega-cities, many of them in developing countries” (Marcus, A.A. 2011), therefore, organizations that decide to globalize gain certain advantages. Globalizing can simulate new streams of revenue for them, which in turn will increase their market share abroad, they may secure better sources of raw materials and energy, they’ll have “low cost factors of production” mainly labor cost, they may receive certain subsidies provided by foreign countries and they can increase the vitality of their U.S. businesses by incorporating the knowledge they gained from their foreign experience.

Marcus, A.A. (2011). Management Strategy: Achieving Sustained Competitive Advantage (2nd ed.). New York: McGraw-Hill Irwin. ISBN: 9780078137129.

In large diversified organizations such as PepsiCo I believe that all business units should use a set strategy that has been proven to be successful, such as in a parallel organization. Success in these type of organizations was achieved by “combining characteristics of staff counsel, consultant investigation, and line management influence, to deal with poorly defined issues that are overlooked, suppressed or mishandled in the formal operating organization”( Zand, D. E., & Hawk, T. F. 2010). It has been shown that using this method can improve a firm's critical policies, profitability, and...