Careful, long-term strategic planning encourages firms to go international for proactive reasons. One pressing reason for many large firms to expand overseas is to seek economies of scale - that is, to achieve world-scale volume to make the fullest use of modern capital-intensive manufacturing equipment and to amortize staggering research and development costs when facing brief product life cycles.'0 Otis Elevator, for example, developed the Elevonic 411 by means of six research centers in five countries; this international cooperation saved over $10 million in design costs and cut the development cycle from four years to two.
Economies of Scale : Implementing Strategy article from Formulating Strategy Catagory Economies of Scale
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