SM0269 - Global & International Business Contexts

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Table of Contents

Global and International Business contexts3

Introduction3

Task A4

Task B17

References20

Global and International Business contexts

Introduction

The paper has been defined and divided into two broad categories. Task A will cover a contextual analysis that shall define the utility and significance of Porter's National Diamond (PND) model in economic interpretations, while task B covers the critical evaluation of this model, whether the model has credibility in terms of taking decisions for national and international progress and escalation. In this paper, we shall adopt a framework that contributes towards our analysis and conception regarding the patterns of economic activity that prevail in a country and that what impacts occurs to the dramatic or static attempts made towards economic escalation and development (Aiginger, 2006, pp.63).

Task A

Applying the PND Model upon the Indian Soft Drink Industry

Brought by the infamous Michael Porter in the year 1990, the Porter's National Diamond (PND) model was introduced in the book “The Competitive Edge of Nations”, which signified and showed why industries had, if not absolute, comparative advantage, while holding their ground in specific locations in a country (Beine, Docquier & Rapoport, 2001, pp.267).

Contextual Analysis

Factor Conditions

Factor Conditions pertain to describe those tools or resources that would help a business or an industry flourish; to put it in economic terms, it implies the factors of production, which include land, labour, capital and entrepreneurial abilities, which help establish and direct the targets and objectives of the business.

While the Indian market still persists and constantly makes way for improvement, there still exists a major segment that runs upon traditional methods of dealing with customers and maintaining close rapport with their clients and customers. Changing their point of focus and creating a brand new market segment is amongst the most important facets for the company to avail and concurrently maintaining the current customer clientele, who have been associated with the brand.

Demand Conditions

Demand conditions clearly regard the efforts and strategies adopted by local companies in order to satisfy the local demand of the economy. In this situation, companies pertain to gain competitive advantage by catering to the demands of the local customers and at the same time create strategies, adopt tactics and steps that would contribute towards the development and establishment of recurring, cut-throat competition among corporations and industries.

To understand the reputation that exists in India, demand conditions are much higher for the local market in comparison to the global need. With the ever growing population of the country, India has become a rather favourite platform for each country. In alignment with the Diamond Model, India is a hybrid of both factor and demand conditions that currently exist today. Therefore, demarcating the marketing and economic efforts delivered and intended by each player (Coca-Cola, Pepsi, Bisleri) should be considered as a separate entity, rather than grouping all three in a single cluster.

Related & Supporting Industries

Related and Supporting Industries are those small and medium-sized firms, or wholesalers, retailers, vendors and suppliers, who are supporting the business ...