Competitive Strategy Global Innovation Networks

Question: Discuss about the Competitive Strategy for Global Innovation Networks. Answer: Introduction: As per the article by Bogdanovic et al. (2015), AAA framework reflects three generic approaches for the effective development of global value creation. In the present competitive business environment, development of global value creation is extremely important for sustaining consistent growth in the market. Now, CITIC-Heavy Industries Co. Ltd has its presence in different parts of the world. Therefore, it has become necessary for the organization to consider different factors to enhance global value of the organization. The AAA framework for CITIC-Heavy Industries Co. Ltd is described as follows: Adaption: Adaptation refers for the development of global value by changing different elements of an organizations offer to fulfill local preference or requirements. Now, in case of heavy machinery industry, the need from the market is changing in continues manner. Therefore, it has become necessary for CITIC-Heavy Industries Co. Ltd to have some degree of adaptation so that it can able to fulfill all the requirements of the market (Citic-hic.com, 2016). For instance, development of heavy machinery cost different in different economy. Therefore, CITIC-Heavy Industries Co. Ltd also has to adapt pricing strategies of the market in such a way so that it can able to create desired level of impact on the global market. Aggregation: As highlighted by Morschett, Schramm-Klein and Zentes (2015) aggregation describes the importance of developing economies of scale or scope so that an organization can able to deal with the differences effectively. The objective of aggregation is utilizing similarities among the geographies rather than focusing only on adaptation strategy. However, CITIC-Heavy Industries Co. Ltd has tried to adapt different changes in the market effectively in order to impose itself globally. Still, it also has tried to maintain some specific standards so that organization can able to maintain its uniqueness in the market. Arbitrage: As per the article by Jha, Dhanaraj and Krishnan (2014), one of the popular way of developing global advantage is arbitrage. It describes the way of exploiting differences than focusing on creating bridge among the differences. Now, CITIC-Heavy Industries Co. Ltd has utilized arbitrage strategy for the effective utilization of outsourcing techniques effectively. The organization has tried to purchase raw materials from a relatively cheaper economy and sale the final products in an economy that is ready to offer higher price. Furthermore, CITIC-Heavy Industries Co. Ltd has focuses on the proper utilization of administrative arbitrage so that it can able to utilize legal, political and institutional differences effectively in the global market. References: Bogdanovic, I.D., Kokot, M. and Krishnan, S., Juniper Networks, Inc., 2015.Customer extendable AAA framework for network elements. U.S. Patent 8,955,055. Citic-hic.com. (2016).CITIC-Heavy Industries Co. Ltd. [online] Available at: https://www.citic-hic.com [Accessed 18 Sep. 2016]. Jha, S., Dhanaraj, C. and Krishnan, R., 2014, January. MNE RD in Emerging Markets: Arbitrage, Adaptation Aggregation in Global Innovation Networks. InAcademy of Management Proceedings(Vol. 2014, No. 1, p. 17650). Academy of Management. Morschett, D., Schramm-Klein, H. and Zentes, J., 2015. The Integration/Responsiveness-and the AAA-Frameworks. InStrategic International Management(pp. 25-49). Springer Fachmedien Wiesbaden.