Shakajinn Besides these, it has other advantages such as the possibility of knowing the customer better and maximum degree of marketing orientation. Finally, it tries to balance both global integration and local responsiveness. The case of European Silicon Structures illustrates internatoonal practice of geocentric organizations. Thus, ensuring efficient use of human resources by building strong culture and informal management channels.
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Firms in the international market have a different orientation and operating strategy. The country in which a company has its headquarter is Home country and countries where it has subsidiaries are known as host countries. EPRG Framework helps the company to decide the way in which strategic decisions are being made and how the company manages operations between headquarter and its subsidiaries. Plans for overseas market are developed in the home office of the company.
Personnel is hired from home country. Also, promotion and distribution strategies are similar to that employed in the home country. Decisions can be altered as per the economic, political and cultural disparities in the country. This provides a firm to manage its operations independently, without much interference from its headquartered. Countries like India, Pakistan and Bangladesh possess similar characteristic and can be served well with a single marketing strategy.
Marketing strategies are not influenced by the home or host country preferences. A firm tries to adopt globalized marketing, formulates an integrated marketing strategy for across the globe.
What is an EPRG Framework in International Marketing?
Geocentric orientation. Ethnocentric Orientation. A person who assumes his or her home country is superior compared to the rest of the world is said to have an ethnocentric orientation. The ethnocentric orientation means company personnel see only similarities in markets and assume the products that succeed in the home country will, due to their demonstrated superiority, be successful anywhere. At some companies, the ethnocentric orientation means that opportunities outside the home country are ignored. Such companies are sometimes called domestic companies.
International Marketing - EPRG Framework
He states that businesses and their staff tend to operate in one of four ways: Ethnocentric These people or companies believe that the home country is superior. When they look to new markets they rely on what they know and seek similarities with their own country. Overseas subsidiaries or offices in international markets are seen as less able and less important than the head office. In these companies, opportunities outside the home country are ignored. Such companies are also sometimes referred to as domestic companies. Polycentric In contrast, polycentric organizations or managers see each country as unique, and consider that businesses are best run locally. Polycentric management means that the head office places little control on the activities in each market, and there is little attempt to make use of any good ideas or best practices from other markets.
EPRG FRAMEWORK IN INTERNATIONAL MARKETING PDF
These four international business modules are ethnocentric, polycentric, regiocentric and geocentric orientations. In the year , Howard Perlmutter proposed the EPG model where he suggested three different frameworks i. This model was later upgraded by Perlmutter, Wind, and Douglas in the year to include regiocentric orientation. Thus, it became the EPRG framework. Let us now go through each of these strategies in detail below: Ethnocentric Orientation Ethnocentric oriented companies though operate internationally, but they consider their home country superior to their overseas subsidiaries.
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This framework addresses the way strategic decisions are made and how the relationship between headquarters and its subsidiaries is shaped. These stages are discussed below. Ethnocentric Orientation The practices and policies of headquarters and of the operating company in the home country become the default standard to which all subsidiaries need to comply. Such companies do not adapt their products to the needs and wants of other countries where they have operations. There are no changes in product specification, price and promotion measures between native market and overseas markets. The exercises, activities and policies of the functioning company in the native country becomes the default standard to which all subsidiaries need to abide by.