International competition between global companies takes a lot of hard work from a managerial point of view. Companies have to be careful but at the same time they must be aggressive enough to be able to face competition. A global organization must mobilize all its resources against competitors. Several actions can be taken to compete successfully: lower prices or studying each country's market position. Economies of scale and R&D play a major role in determining whether a company can successfully compete globally, besides companies must be willing to take the risk of going global.
             Caterpillar became against all odds a world leader in the construction equipment business. One of Caterpillar's competitive advantage is that it adopted from its early days a global distribution system that increased revenues, it also built plants in its major international markets to eliminate high transportation costs. One major threat that Cat has to face is Komatsu, its Japanese rival. To keep world leadership, Cat uses a global strategy that always keeps Komatsu one step behind, it relies heavily on economies of scale, it also invests heavily and in 1963 it formed a joint venture with Komatsu's rival in Japan: Mitsubishi, which decreased Komatsu's profits.
             By focusing on technology, Ericsson was able to become a global competitor. First it dealt with its own home market (Sweden), then it expanded focusing on countries that used switching systems that were similar to Sweden's. Afterwards, in the 1970's, competition increased with the rise of electronic switching technologies, which threatened to take away the competitive advantage Ericsson had with smaller government telephone companies. To respond to this threat, Ericsson developed new modular software packages at reasonable costs, these packages fit any telephone systems and made Ericsson a global competitor in small systems.
             Honda revolutionized the motorcycle in...