Strategic Managment

Critically discuss the issues and challenges organisations face when pursuing organic rather than external methods of development

During the 1990s , the popularity of globalisation opened the internationalisation of many business firms via external expansion External methods of development pertain to the various ways through which business firms expand via associations with other business firms or entities (Gaughan , 2002 ) for the sharing of resources from the resource-based perspective , competencies from the human resource management perspective , and market advantages from the marketing management perspective (Fink et al , 2005 . Many companies became global

business firms by using various methods including joint ventures mergers and acquisitions , takeovers , and other forms of strategic alliances . Many business firms grew in terms of market reach , scale and size through these methods . However , many companies also experienced stunted growth after some period of international operation (Gosh 2001 , leading to the challenge in shifting to a development scheme that supports progressive and protracted growth in the long term . The focus of development efforts honed on internal capabilities because of the observation that those firms that experienced continuous growth were able to do so not only by engaging in external methods of global expansion but also by focusing on key internal capabilities . Internal methods refer to the means of achieving development generated from reliance on and enhancement of the internal competencies of the business firm (Barney , 1997 Hill Jones , 2008 ) This solidified the equal strategic importance of sourcing organisational development from within the firm itself . Nevertheless , the Asian financial crisis...