Howard Perlmutter identified a way of classifying alternative management orientations, which is commonly referred as Perlmutter’s EPRG model. He states that. The aim of this paper is to present the fundamental ideas behind EPRG model . () the essence of geocentric strategy is an uniform approach to all national. To overcome from this problem one should adopt EPRG Framework, ETHNOCENTRIC ORIENTATION: Ethnocentric approach will better suit.
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Circumstance under which EPRG should be employed. Orientation towards international operations by a company, which consider the whole world as one market and hence develops global strategies which are applied in domestic market also. Irrespective of the nationality, the company tries to seek the best men and the problems are solved globally within the legal and political limits.
International Marketing – EPRG Framework
Retrieved from ” https: With that said, geocentrism xpproach an ideology that must be accepted by any corporation operating globally in order for any sort of success and long term stability to be attained. In these companies, opportunities outside the home country are ignored. This page was last edited on 10 Novemberat Polycentric will prove idle for firms seriously committed to international marketing and have capacity to invest to the desired extent towards achieving their objectives.
They provide for improved coordination and control. A polycentric approach “gives rise to the problems of coordination and control. In this context, ethnocentrism is the view that a particular ethnic group’s system of beliefs and values is morally superior to all others.
Every participating country is treated solely and individual strategies are carried out. These policies entail high cost. Each of the three elements of the EPG profile is briefly highlighted approacy the table below, showing the main focus for each element, as well as its correlating function, products, and geography. Home standards are applied to the evaluation and control of the organization.
Using the centralized approach can cause inefficient staffing problems in the organization, this is because the employed staff will incur high financial costs to the global business as they have to pay for the transfer alproach of the staff coming from the home country to overseas. I hold a degree in MBA from well known management college in India.
Overseas subsidiaries or offices in international markets are seen as less able and less important than the head office. The ethnocentric attitude is seen often when home nationals of various countries believe they are superior to, more trustworthy and more reliable than their foreign counterparts.
Ethnocentric approach will better suit small firms just entering international operations.
EPRG – INTERNATIONAL MARKETING ORIENTATION – Priyanka Blog Thoughts
The trend of more and more internationalisation of business has thrown many challenges to international marketer. This article is written like a personal reflection, personal essay, or argumentative essay that states a Wikipedia editor’s personal feelings or presents an original argument about a topic. Many of the companies involving themselves in exporting and importing of various commodities.
The first drawback of a polycentric approach is that the “benefits of global coordination between subsidiaries such as the development of economies of scale cannot be realized.
International Marketing EPRG Framework
A polycentric approach should only be used within a company in which there is a certain amount of comfort in allowing the host country to make all major decisions, following their own procedures and objectives. The case of European Silicon Structures illustrates the practice of geocentric organizations.
There are no changes in product specification, price and promotion measures between native market and overseas markets. For instance, there is the loss of national sovereignty when one nation is dominated by another — this can lead to a loss in economic and political nationalism.
The importance of the EPG model is mainly in the firm’s awareness and understanding of its specific focus. It is a natural tendency for people to act ethnocentrically because it is what they feel comfortable with.
Thus, ensuring efficient use of human resources by building strong culture and informal management channels. 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.
The major drawback of this fprg set is that it results in cultural short-sightedness and does not promote the best and brightest in a firm. This is because it does not need to send skilled managers out to maintain centralized policies. Organizations that are designed with an ethnocentric focus aporoach portray certain tendencies.
The main difference of geocentrism compared to ethno- and polycentrism [ disambiguation needed ] is that it does not show a bias to either home or host country preferences but rather spotlights the significance of doing whatever it takes to better serve the organization. The EPG model aprpoach a framework for a firm to better pinpoint its strategic profile in terms of international business strategy.
Therefore, the majority of control in the host countries practices is lost, and the company is forced to manage its operations from the outside.
Although there is great benefit to taking into consideration local preferences in the host country when it comes to fprg business practices, a polycentric approach has its obstacles once implemented. These include an organizations headquarters that’s decision-making authority is relatively high.