The Frau group of companies has decided to practice a strictly regiocentric strategy across the 5 countries it operates in which are clustered in Eastern Europe. The countries are Bulgaria, Croatia, Czech Republic, Estonia, Hungary. The Frau group’s decision to pursue this strategy and concentrate its business activities in a limited number of locations in Eastern Europe is least likely due to?

The Frau group of companies has decided to practice a strictly regiocentric strategy across the 5 countries it operates in which are clustered in Eastern Europe. The countries are Bulgaria, Croatia, Czech Republic, Estonia, Hungary. The Frau group’s decision to pursue this strategy and concentrate its business activities in a limited number of locations in Eastern Europe is least likely due to?
A . steep learning curve associated with performing its business activities in other locations outside Eastern Europe.
B . costs of performing business is lower and quality levels are higher in Eastern Europe compared to other geographic locations
C . better coordination of business activities in cultures that are significantly similar to the headquarters of the Frau group
D . high-ranking talent from third country nationals that boosts innovation, creativity, and human capital.

View Answer

Answer: D

Explanation:

The Frau group’s regiocentric strategy will have as a disadvantage the inability to source talent from outside its preferred region. Third country nationals are employees who are neither from the home country or the host country. These diverse group of talent can bring innovation and creativity to companies that are amenable to recruiting and including them.