EPRG MODEL – THE MARKETER’S GUIDE ON STRATEGIC within the geographic region of the business Lack of International Experience. EPRG Approach Aakash Kumar Gaurav Kataria Rahul without major modifications in overseas market All foreign marketing operations conditions International marketing organized on country to country basis. EPRG framework in international marketingDr. Howard V. Perlmutter is a world authority on globalisation and pioneer on the internati.
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He states that businesses and their staff tend to operate in one of four ways:.
Home standards are applied to the evaluation and control of the organization. The importance of the EPG model is mainly in the firm’s awareness and understanding of its specific focus. One of the major challenges is which type of orientation a firm should adopt to overseas its marketing operations.
Similarly, if a company focuses its attention on the Europe, company follows regiocentric approach. Many of the companies involving themselves in exporting and importing of various commodities. The management of a company has to decide the type of orientation that a firm should give to its overseas marketing operations.
Not only is global trade is growing at healthy rate, but techniques of overseas marketing is also becoming more diversified and sophisticated. Local personnel and techniques are best suited to deal with local market conditions. 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.
Ethnocentric companies that do conduct business outside the home country can be described as international companies, they adhere to the notion that the products that succeed in the home country are superior and, therefore, can be sold everywhere without adaptation. When company is small and is not in position to invest heavily in overseas operations, it is better for it to identify countries which have characteristic similar those of home country and export to them.
For example, Norway and Spain are both in Europe, but are very different in climate, culture, transport, retail distribution, and so on. While there are many obstacles that will hinder a company’s ability to become geocentric, there are also a handful of forces which will drive them towards this. This approach is more successful in areas such as production and research than in marketing.
At some companies, the ethnocentric orientation means that opportunities outside the home country are ignored. However, this approach is not suitable for companies which are planning to extend their international operations in a big way.
Since not much investment is made in overseas operations so if loss may occur then firm can absorb shock without much difficulty. Circumstance under which EPRG should be employed. The crucial critical concept of ethnocentrism in international organizations is the current policy that recruits from the home country are hired, and trained for key executive position in the organization. Overseas subsidiaries or offices in international markets are seen as less able and less important than the head office.
Instead, management selects the person best suited to foster the companies goals and solve problems worldwide.
This assumption lays the groundwork for each subsidiary to develop its own unique business and marketing strategies in order to succeed, the term multinational company is often used to describe such a structure. The polycentric orientation is the opposite of ethnocentrism. Views Read Edit View history.
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.
Each subsidiary operates independently of others and establishes its own marketing objectives and plans. There are many ma Today in the era of globalization, this approach is not popular.
Intsrnational, there are certain aspects of the business life in which ethnocentrism and polycentrism are more adequate models to buainess, but functional smoothness and success in both home and host countries is dependent upon upper managements ability to select individuals who are world orientated as opposed to home or host country centered.
Marketing personnel are recruited from that region, regional channels of distribution are developed and policies in respect of other areas such as product, price and promotion have a regional orientation.
These orientations reflect the objectives of a company towards international operations and to lead to different management strategies and planning procedures. The suitability of EPRG orientation may differ not only from company to company but also from-j one marketing decision area to another within the same firm.
In the present day Geocentric companies, as truly global players, view the world as a potential market, and seek to serve this effectively. November Learn how and when to remove this template message.
They provide for improved coordination and control. A polycentric approach “gives rise to the problems of coordination and control. The term ethnocentric orientation means that i company does not differentiate between domestic and foreign internationla This is because it does not need to send skilled managers out to maintain centralized policies.
Such companies are also sometimes referred to as domestic companies. It is a natural tendency for people to act ethnocentrically because it is what they feel comfortable with. Companies should evaluate all legs of the EPG model before implementing a strategy, as all rprg differ in international strategy among industry and region.
Management is unable to have total control over the company in the host country because it is found that “local nationals have a better understanding and awareness of national market conditions, more so than home office personnel.
The major advantage of this type of orientation is that it will be the most effective way of motivating internxtional management, since the management in each country is given a free hand in framing policies and implementing businness. For a manufacturing firm, ethnocentrism means foreign markets are viewed as a means of disposing of surplus domestic production.
International Marketing EPRG Framework
The general attitude of a company’s senior management team is that nationals from the company’s native country are more capable to drive international activities forward as compared internationa non-native employees working at its subsidiaries. In the most extreme views of polycentrism, it is the “attitude that culture of various countries are different, that foreigners are difficult to understand and should be left alone as interhational as their work is profitable.
The major drawback of this mind set is that it results in cultural short-sightedness and does not promote the best and brightest in a firm.
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. It has been introduced by Howard V. EPG Model is an international business model including three dimensions — ethnocentric, polycentric and geocentric.
See all related question in international marketing management. Polycentric management means that the head office places little control on the activities in each market, and there is little attempt to make use of any good ideas or best practices from other markets. This framework addresses the way strategic decisions are made and how the relationship between headquarters and its subsidiaries is shaped.