Many marketing experts have argued that a well-developed planning process is fundamental for the achievement of a coherent approach when attacking international markets. The principal benefits of planning in international markets are:
- International market Planning encourages proactivity rather than reactivity so that the company is able to steer its own destiny rather than simply react to events. Firms need to gain competitive advantage by moving into new markets or developing more aggressive strategies in old markets.
- It encourages a systematic process of analysis of all the factors involved in decisions, rather than simply those uppermost in the decision-maker’s mind at a particular moment.
- Firms are forced to state objectives and policies clearly and precisely so that they are not misinterpreted by individual managers who might be quite remote from the point at which decisions are made.
- As the management task becomes more complex in dealing with many different markets it is essential that managers become more focused in their thinking.
- As the environment becomes increasingly complex and unstable, planning prepares the company for reacting quickly and decisively in a coordinated and effective way.
- It helps the company to coordinate strategies in different markets for the benefit of the company as a whole, so that it can out-perform the competition
- As ease of communication and mobility increases, customers must be able to find familiar product or service ‘offers’ in each market.
- Planning facilitates the development of common performance and quality standards which can be used for company-wide control.
- The participation of managers in the international market planning process increases ownership and loyalty and also allows easier intra-company transfer and career development. This is particularly important where there are major cultural differences.
- A better understanding of the requirements of other functions and subsidiaries in different countries reduces internal company conflict and encourages the selection of strategies which will be beneficial for the whole company.
- International market Planning necessitates the development of company-wide standardized information transfer systems so that the accessibility and value of information is improved.
- Short-term action and control measures and long-term strategies can be integrated through effective market planning.
The extent to which individual companies realize these benefits in practice, however, is dependent on a number of largely internal and controllable factors such as the nature and structure of the company, the stage of evolution of the organization and the managerial philosophy, all of which have a major impact on the culture of the firm. MNEs (multi-national enterprises) are making fundamental decisions about the way that they will operate in future.