Internationalisation of Companies

Abstract

The cost to operate worldwide was very high in the olden days and most countries had no knowledge about the culture, language and demands of foreign countries. This was the main reason behind failure of internationalization. However, over the last few decades, most companies have started to run for globalisation and this in turn has resulted in internationalisation of most business organizations (Margardt, 2007). The internationalisation of a firm is a complicated process rooted in the history of the firm and its administrative heritage as well as in its general strategic planning. The main aim of this literature is to find out the reasons why companies choose to go international, especially in grocery retailing and the civil aerospace manufacturing business. Theories of internationalization inherently deal with questions of business development and strategy which this work tries to analyse from the perspective of the two industries. Internationalisation has been defined as developing networks of business relationships in numerous countries by ways of extension, penetration and integration, which requires the commitment of resources and the adaptation to international markets. For companies to stay competitive in their respective environment they need to go international (Hart, 1999). This literature reviews the various drivers of internationalisation along with the importance of alliances and joint ventures in today’s world.