Question

1. Why would a business choose an internal growth strategy rather than an external growth strategy?
2. What industry conditions would be most likely to lead a firm to pursue external growth?
3. In your opinion is an offensive or defensive collaboration more effective as a tool to gain competitiveness? Why?

4. What if a company chooses NOT to align with the dominant design that emerges in the latter stages of the life cycle—but instead chooses to continue to pursue a form of differentiation in a niche segment of the market?

Answer 1

Business pick an internal growth strategy rather than an external growth strategy are-

Internal, or organic, growth procedures depend on the company's own assets by reinvesting a portion of the benefits. Internal growth is planned and moderate. In an external growth strategy, the company draws on the assets of different companies to use its assets.

- Market Investment

A range of internal growth techniques rotate around expanding piece of the pie. In a market infiltration strategy, the company attempts to offer more to its current markets by improving item quality or bringing down costs. On the other hand, the item advancement strategy includes growing new items to sell in existing markets of the company. The other strategy is showcase advancement, in which the company puts resources into advertising endeavors to sell existing items in new markets. At last, a more dangerous strategy is expansion that requires selling new item in new markets.

- Mergers

A merger is an external business growth strategy that happens in two different ways: takeover and amalgamation. In a takeover or procurement, a company purchases a greater part stake in the other company and assumes control over control. In amalgamation, at least two companies unite to frame a solitary element. Accomplishing economies of scale, entering new lines of business and getting to scant crude materials are a portion of the reasons why companies unite.

- Joint Ventures

A joint endeavor is an external business growth strategy. In a joint endeavor, at least two companies choose to build up another business venture to misuse a particular business opportunity. A joint endeavor is a snappy and productive approach to misuse a business opportunity. An independent venture will most likely be unable to tie down enough assets to enter another market or build up another item or administration. Also, a joint endeavor is an attractive strategy to share the dangers of beginning another undertaking to enter another market.