Michael J. Enright
Harvard Business School (793135-PDF-ENG)
May 04, 1993
Addresses the role of geographic reach in competition and strategy. Distinguishes between the geographic range of competition (or the effective area in which companies compete), the geographic range of competitive advantage (or the geographic area from which a company can derive location advantages), and the geographic range of the strategy (the area on which a Company chooses to compete and locate its activities). The geographic scope of competition is influenced by technology, taste, government, and corporate strategy. Location advantages result from favorable factor conditions, demand conditions, related and supporting industries, corporate strategy, structure, and rivalry. The company can choose to compete in a single market (a geographically focused strategy), all markets (a global strategy), or a combination of markets. The company can choose the configuration (location) and the coordination of its activities. The company updates geographically dispersed units through the selection of markets to be served, the location and coordination of activities, as well as the active management of economies of scale, networks and learning effects.
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