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April 2, 2015 The Dismal Odds of Finding a Winning Strategy OverseasIt’s a given today that big companies need to look for global opportunities. Yet one-third of the top 10% of companies among 20,000 studied by Christian Stadler of Warwick Business School conduct almost no international business. That’s because few companies have the management capabilities to succeed overseas, Stadler writes on HBR.org. Companies that expanded domestically had an average ROA of 1% after five years and 2.4% after 10, with 53% exceeding 3%; but those selling abroad had an average ROA of minus 1% as long as five years later. It takes 10 years to reach a modest 1%, and only 40% of companies turn in more than 3%. |
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