Gamma Foods Inc., a company popular for its dairy products, successfully follows a multidomestic strategy. RiverGem Inc., a large conglomerate, pursues a transnational strategy. Which of the following statements is most likely true of this scenario?
A. While RiverGem Inc.'s competitive advantage will lie in its high local responsiveness, Gamma Foods Inc. will lack such competencies.
B. Gamma Foods Inc. will face greater pressure for cost reductions than RiverGem Inc. due to its strategy choice.
C. Both Gamma Foods Inc. and RiverGem Inc. will have to duplicate key business functions in multiple host countries.
D. While Gamma Foods Inc. will require a global matrix structure, RiverGem Inc. will require a traditional headquarters model.
Answer: C. Both Gamma Foods Inc. and RiverGem Inc. will have to duplicate key business functions in multiple host countries.
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