Expanding The Organization

Full Answer Section

    Demand conditions: The demand conditions in Mexico are favorable. The country has a large and growing population, with a median age of 29.4 years. The Mexican economy is also growing, with a GDP growth rate of 5.5% in 2022. Related and supporting industries: Mexico has a well-developed manufacturing sector. The country is also a major producer of oil and gas. The Mexican government is investing in infrastructure and education to support economic growth. Factor endowments: Mexico has a large pool of labor, with a low labor cost. The country is also rich in natural resources. Forces that will help the organization succeed

• Favorable demand conditions
• Well-developed manufacturing sector
• Large pool of labor
• Low labor cost
• Rich in natural resources

Forces that may act as barriers to expansion

• Moderate level of industry rivalry
• Corruption
• Drug cartel violence
• Infrastructure challenges

Recommendations for leaders Develop a global mindset: Leaders should develop a global mindset by thinking about the business from a global perspective. They should be open to new ideas and perspectives from different cultures. Develop sensitivity to cultural differences: Leaders should develop sensitivity to cultural differences by learning about the culture of the country they are expanding into. They should be respectful of the local culture and customs. Decentralize: Leaders should decentralize decision-making by giving local managers more autonomy. This will allow the organization to be more responsive to local market conditions. Decide on the level of involvement: Leaders should decide on the level of involvement they want to have in the foreign operation. They can choose to have a high level of involvement, where they make all the major decisions, or they can choose to have a lower level of involvement, where they give local managers more autonomy. Leadership actions

• Develop a global mindset: Leaders can develop a global mindset by reading books and articles about global business, attending conferences on global business, and traveling to different countries.
• Develop sensitivity to cultural differences: Leaders can develop sensitivity to cultural differences by reading books and articles about the culture of the country they are expanding into, talking to people who have experience working in the country, and visiting the country before making a decision to expand.
• Decentralize: Leaders can decentralize decision-making by giving local managers more authority to make decisions about their operations. They can also create a system for communicating with local managers and providing them with support.
• Decide on the level of involvement: Leaders can decide on the level of involvement they want to have in the foreign operation by considering the factors such as the size and complexity of the operation, the level of risk, and their own expertise.

Conclusion Mexico is a potential international market for the organization. The country has a number of factors that make it an attractive market, such as a large and growing population, a growing economy, and a well-developed manufacturing sector. However, there are also some challenges that the organization would need to overcome, such as the moderate level of industry rivalry, corruption, drug cartel violence, and infrastructure challenges. Leaders can increase the chances of success by developing a global mindset, developing sensitivity to cultural differences, decentralizing decision-making, and deciding on the appropriate level of involvement.  

Sample Solution

   

Diamond of National Advantage

Industry rivalry: The level of industry rivalry in Mexico is moderate. There are a number of domestic and foreign companies operating in the country. The major domestic players include Grupo Bimbo, Cemex, and América Móvil. The major foreign players include Walmart, Coca-Cola, and Ford Motor Company.