Topic
Critical Strategic Decisions in Managing the Relocation of a Business in the Global Market-The Case of Alibaba Relocating to the United States
Instructions
Write an individual report on the Strategic Issues faced by a particular business or organisation in its effort to relocate to a particular market and the Strategic Recommendations on how to address them. This report asks you to undertake an assessment of the major strategic issues the business or organisation will face before and after successful relocation to the new market. It also asks you to articulate the strategic analysis tools/frameworks that you envisage being most useful for your analysis and your evaluation to ensure relevant strategic information is espoused on the organisation. The main task involves; identification of the main strategic issues and well-conceived recommendations succinctly and professionally structured.
Alibaba is China’s largest e-commerce platform. To grow and fortify its competitive edge, Alibaba has decided to relocate its Head Quarters (HQ) and Warehouse to the United Stated (US). Alibaba hopes to recruit and tap in to the stronger power purchasing parity of the American consumers. However, Alibaba is also concern with the power of competitors in the US. Importantly, the stopping of
HUAWEI’s expansion in the US by the US government and trade tensions between US and China should give Alibaba food for thought. Therefore, Alibaba has to carry out a detailed analyse, learn and understand the US – host country before arrival and how to better settle on arrival.
The report should identify macro environmental (PESTEL framework highly recommended) issues with the potential to inhibit Alibaba successful relocation. Also, the report should pay close attention to issues such as industry competitive forces (Porter’s Five Forces Framework would help) in the host country, and analysis of the strategies used by the major competitors in the host country.
Moreover, the report should clearly identify, through employment of framework such as VRIO the strength and resource position Alibaba will have to count on to mount a successful competitive fight in order to establish its position in the host country.
Answer preview
Relocating business operations to a new global location may present wide ranging opportunities, but it also involves many challenges. Therefore, to optimize the relocation to a new market, business organizations have to make strategic decisions, so as to handle all the applicable strategic issues (Sahay, Mohan & Maini, 2004). The preparation to relocate to a new market should include, among other things, the study of the new market location to understand the prevailing market conditions, opportunities, as well as the challenges the firm would face. A study of the market also provides information of the external factors in the market, such as political, economic, social, technological, environmental and even legal dynamics which would almost certainly affect the performance of the business (Sahay, Mohan & Maini, 2004).
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