Company Overview
The following paper will highlight the importance of internalization of organizations and the different elements related to the process of internalization. The internalization process is highly beneficial for the companies as because it helps in the expansion of the company as well as helps the company to increase the brand name of the organization (Adekola and Sergi 2016). The study aims at providing a detailed analysis of the different strategies of a particular company that it undertakes to enter and stay sustainable in a foreign land. Apart from this the following study also aims to provide an analysis of the performance of the firm in the foreign market and the theories in support of the strategies and performance of the company in the following markets. The use of some important sources related to the following topic and a good description of the company in the beginning provides a larger and better scope for the following assignment.
Amcor Limited is a reputed name in the global packaging industry. It is well known for the development and packaging of the rigid containers, cartons especially large cartons, closures, beverage, home and personal care and other device. Amcor is listed on the Australian Security Exchange (www.amcor.com. 2018). The company is headquartered in Southbank, Australia and the corporate headquarters of the organization is located at Zurich, Switzerland. With revenue of around $9.1 billion the company is one of the largest of Australia (www.amcor.com. 2018). The management of the organization employs around 35,000 people in the company and has more than 200 stores which is spread over 40 different countries around the globe (www.amcor.com. 2018). The company has two main reporting segments namely the Flexible Packaging and Rigid Plastics. These two different units are based in two different areas and serve different purposes. The first one is engaged in the development and supply of flexible packaging and different types of folded cartons that are used to carry different types of products. The following unit consists of four different business units namely, flexible middle east and Africa, flexible Europe, Flexible Americas and last but not ht e least in any ways Special Cartons. On the other hand Rigid Plastics has similar kind of four different business units by the name of North America Beverages, North America Specialty Containers, Latin America and Bericap Closures (www.amcor.com. 2018).
The main products of the company include the likes of the packages for use with snacks and different confectionaries, fresh products, cheese, other beverages, pet products, plastic containers for different types of brands in the food beverage and medical uses and many more as such. The medicine that uses the packaging of the mentioned company are safely packaged and maintains all the requirements including the likes of unit doses, safe compliance, sustainability and other safety features of the business (www.amcor.com. 2018). The company also provides cartons and packaging for products like wines, foods, home care items and others. The company also provides limited services of handling, transporting and warehousing facilities.
Cross Border Strategy
According to, Adekola and Sergi (2016) Internalization is one of the main interests that help the development of a large number of companies. There is no single and universally accepted definition of internalization of the company but from the economic point of view the following can be referred to as the process where the business organization gets more and more involved in the markets in the international arena or the markets of the foreign land. The following study provides the different factors that have helped in the internalization of Amcor in different markets outside Australia (Cavusgil and Knight 2015).
The growth of globalization has made the entry of different business firms in the different markets of the globe an easy affair. Globalization takes the shape of various different forms as it enters the different countries. Amcor has been successful to establish itself in new lands and new countries by means of implementing different strategies. This are generally referred to as the cross border strategies by the experts of marketing (www.amcor.com. 2018). The value of cross border marketing grew slowly and now it has attained a fast pace. The different alliances and mergers by different companies have moreover enhanced the cross border strategies and has helped in the growth of strong alliances in the market and ultimately in the growth of the business. The need for the cross border alliances has risen to great heights nowadays just because of the large increase in the competition in the market and the huge increase in the amount of the strategic initiatives of the business (Adekola and Sergi 2016).
Internalization has been one of the biggest developments of the last decade and like most other companies in the market, the management of Amcor has utilized the opportunities of the business to establish itself in the foreign market (www.amcor.com. 2018). The main factors that drive a company towards international markets can either be a particular event or a chain of different events that combine both the internal as well as the external factors in the organization. The internationalization generally occurs when the business organization expands it Research and Development wing, production selling and other types of the business activities into the different international markets. The organization generally goes much beyond just selling and promoting itself like many other companies and tries to penetrate the minds of the customers so that they buy their products. Generally the following kind of marketing is considered to be universally accepted but there are instances when such kind of marketing turns to be complex and diversified in nature. The management of the business organization has to take care of the plans and strategies because of the uncertain nature of the competitive business world (www.amcor.com. 2018). There are many a theories that define the internalization of the business firms and also show the necessity, advantage or disadvantages of adapting to such kind of marketing principles. The company thus establishes the cross border strategy based on the market and the environment in which it operates.
Performance of Amcor in a Foreign Market
Global Marketing or the globalization of the markets is one of the most important issues for the different types of multinational business firms. Many companies who market the global products around the world look for different types of opportunities in the global markets. Globalization of the markets is one of the most challenging issues for the companies as well as the authorities. The company has been immensely successful in the last couple of years globally. The presence of the company in more than 40 different countries of the globe is one of the biggest examples of such a success (Forsgren 2016). The company has earned multiple numbers of gold awards and high performance ratings for packaging innovation and sustainability excellence. This includes the prestigious DuPont Packaging Innovation Awards and the Flexible Packaging Awards. The company has entered into a strategic alliance partnership with the likes of EMF, WFP and the trash free Seas alliance that has helped them to be considered as a green company with initiatives to reduce pollution and stacking of paper cartons in the water and the land.
The main feature of the following packaging company in the foreign markets has been its ability to transform itself into an ethics and integrated based company. The management of the company talks the responsibility of corporate governance and guides and monitors the business of the organization according to the standard rules and regulation of the countries. The board operates in accordance with the principles that are set out in the charter of the organization and the management is responsible to follow all the rules and regulations of the country where they operate (www.amcor.com. 2018). The main characteristics of the company in the foreign market are as follows;
- Enhancing the value of the shareholder by improving the probability of achieving the different objectives of the organization.
- Encouragement of a high standard of accountability
- Enable the board to fulfill its governance and different types of business requirements
The economic performance of the business organization in the foreign markets is as follows;
The above figure clearly shows the economic performance of the business in the global market. The operating cost of the organization stood at $5853 million dollars and each and every places saw an operating cost on an average of nearly 30 million dollars. The key elements of the market orientation of the following business relates to a number of elements which includes;
- Competitor Analysis
- Long Term Profit Focus
- Organizational Culture
- Coordination between different factors related to the business
As mentioned earlier the globalization process that has been occurring and indeed accelerating in recent times has been mainly due to the various factors of business and changes in information technology (Bouncken Muench and Kraus 2015). The mentioned packaging company has been able to spread its influence in the international countries just because of the large scale globalization process that helps the organization to garner profit from business transactions. There are many theories that can support the following topic. The internalization decision of the firm can be based on a number of different motives. This includes;
The following model describes the internalization process of the firm as a gradual and incremental phenomenon where it leads to the different policies that lead to expansion in the international countries and new markets. This happens in a subsequent manner that begins with the likes of export and then ends with the physical establishment of the firm in the new market (Adekola and Sergi 2016). The following model supports the expansion of the new firms into the new markets. The particular model is generally a stage based model and is a sequential approach to the internalization process of the organization into new markets.
The following theory is mainly based on highlighting the main conditions that has a great impact on the different types of decisions of the business organization. The first being the ownership advantages being enjoyed by the mentioned packaging company, the second being the attraction that the new market provides the business organization (Eriksson et al. 2015). Last but not the least in any ways, the third one is the advantage of the firm in internalizing their own production line. The theories thus provide both valid and disputed points. Thus the internalization process is a much complex one and each and every decision has to be taken in an organized and proper manner to avoid any problems.
Another main business internationalization approach can be defined as the concept of business to make strategic decisions to whether extend their business on the specific variables if they may face the process itself (Bouncken Muench and Kraus 2015). The following approach tries to make an empirical and practical view of the following phenomenon that are addressed by the internationalization process.
Conclusion
The following paper has provided a detailed review on the different types of internalization process and the factors and the ways by which they are carried out. The example of Amcor Limited as the company has been important as it has increased the scope of the assignment. The use of such a practical example will help the readers to easily relate the topic with the company and will also help the future researchers on the following topic to gather valuable information from the following. The various theories on internalization that has been used in the following project also carry great importance to the report. Each of the theories have their own importance. The born global approach of Amcor Limited has been helpful for the management of the organization to establish the company and units outside Australia and Switzerland. The use of all the different elements in the following report makes it one of the best and helps in the formation of a proper and effective report.
References
Adekola, A. and Sergi, B.S., 2016. Global business management: A cross-cultural perspective. Routledge.
Amcor.com. (2018). [online] Available at: https://www.amcor.com/about [Accessed 21 Aug. 2018].
Bouncken, R.B., Muench, M. and Kraus, S., 2015. Born globals: Investigating the influence of their business models on rapid internationalization. The International Business & Economics Research Journal (Online), 14(2), p.247.
Cavusgil, S.T. and Knight, G., 2015. The born global firm: An entrepreneurial and capabilities perspective on early and rapid internationalization. Journal of International Business Studies, 46(1), pp.3-16.
Eriksson, K., Johanson, J., Majkgård, A. and Sharma, D.D., 2015. Experiential knowledge and cost in the internationalization process. In Knowledge, Networks and Power (pp. 41-63). Palgrave Macmillan, London.
Forsgren, M., 2016. A note on the revisited Uppsala internationalization process model–the implications of business networks and entrepreneurship. Journal of International Business Studies, 47(9), pp.1135-1144.
Jiang, G.F., Holburn, G.L. and Beamish, P.W., 2018. Repeat market entries in the internationalization process: The impact of investment motives and corporate capabilities. Global Strategy Journal.
Knight, G.A. and Liesch, P.W., 2016. Internationalization: From incremental to born global. Journal of World Business, 51(1), pp.93-102.
Marano, V., Arregle, J.L., Hitt, M.A., Spadafora, E. and van Essen, M., 2016. Home country institutions and the internationalization-performance relationship: A meta-analytic review. Journal of Management, 42(5), pp.1075-1110.
Ruzzier, M., Rus, M. and Douglas, E., 2015. Global entrepreneurial orientation, inward internationalization, and business survival (Doctoral dissertation, Univerza na Primorskem, Fakulteta za management).
Welch, C. and Paavilainen?Mäntymäki, E., 2014. Putting process (back) in: Research on the internationalization process of the firm. International Journal of Management Reviews, 16(1), pp.2-23.
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