For any business leader, decisions about their company’s geographic footprint are crucial. Entering a foreign market requires major resources and a strong commitment to succeed. Similarly, deciding to locate a manufacturing plant overseas entails the careful selection of an offshore destination. A multinational footprint also has fundamental implications for the overall structure of a company.
Leaders are exposed to two significant errors of judgment when they misunderstand the geography of competition. First, they escalate commitment to geographic markets they should be retreating from; and second, they miss out on novel opportunities to create value across borders in different areas of the world. By getting their geographic footprint wrong, they make the company less resilient and unfit for future global challenges.
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