Contents
International Business Management
Rationale
Globalization (or globalisation) in its literal sense is the process of transformation of local or regional things or phenomena into global ones. It can also be used to describe a process by which the people of the world are unified into a single society and function together. This process is a combination of economic, technological, sociocultural and political forces. [1] Globalization is often used to refer to economic globalization, that is, integration of national economies into the international economy through trade, foreign direct investment, capital flows, migration, and the spread of technology. [2]
Tom G. Palmer of Cato Institute defines "globalization" as "the diminution or elimination of state-enforced restrictions on exchanges across borders and the increasingly integrated and complex global system of production and exchange that has emerged as a result." [3] This is the general definition given by economists, often put more simply as global expansion of the division of labor .
Thomas L. Friedman "examines the impact of the 'flattening' of the globe", and argues that globalized trade , outsourcing , supply-chaining , and political forces have changed the world permanently, for both better and worse. He also argues that the pace of globalization is quickening and will continue to have a growing impact on business organization and practice. [4]
Noam Chomsky argues that the word globalization is also used, in a doctrinal sense, to describe the neoliberal form of economic globalization . [5]
Herman E. Daly argues that sometimes the terms internationalization and globalization are used interchangeably but there is a slight formal difference. The term "internationalization" refers to the importance of international trade, relations, treaties etc. International means between or among nations. "Globalization" means erasure of national boundaries for economic purposes; international trade (governed by comparative advantage ) becomes inter-regional trade (governed by absolute advantage ). [6]
|
 |
Objectives
If you work for a multinational organisation, they should be able to explain how they work with divisions/offices in other countries and the relationship between company headquarters and country offices in matters such as degree of autonomy.
Reasons for "going international"
Despite Piercy's observation that many organisations find themselves involved in international business "by accident", there are many ways in which the organisation can benefit from a planned and systematic development of its activities into the international arena. The most usual reasons for planned international expansion are:
- The home market may be saturated.
- Overseas competition may be less intense than home competition.
- The organisation may have excess manufacturing capacity.
- Comparative advantage in the area of product, skill or technology.
- Organisational reasons (rationalising a haphazard approach to markets).
- Financial (investment incentives, profit-maximisation, loss-minimisation, availability of venture capital).
Broadly speaking, international business will prove to be a more successful venture for the organisation that is exporting as a positive advantage than for the organisation which is exporting to cover a domestic weakness.
Organisation is not an end in itself but a means to an end - the achievement of strategic objectives. By definition the international organisation has operations in several countries; the purpose of its organisational structure is to form a co-ordinated unit which avoids duplication and achieves synergy. Alternative structures range from the "world company" to a collection of truly autonomous operating units.
The optimum structure will depend on a number of variables, namely:
- The relative importance of the organisation's international business
- Number of markets
- Level of international involvement
- Goals for international business
- International experience
- The nature of its products or services
Learning outcomes
On completion of the International Business core course, Course Members will be able to:
1. undertake research into the business operating environment in a country other than their own.
2. identify, analyse and evaluate opportunities for the development of their business in a country other than their own, justifying their conclusions by reference to appropriate theory.
3. prepare a business implementation plan for developing the capability for either producing or marketing in a country or countries other than their own.
4. provide
appropriate advice on the implications of the plan for
the development of the business as a whole.
Today's Videos
- Connect with us on http://www.youtube.com/finntrack
- Google's Playlists
Teaching and Learning Resources
Globalization and International Business
International Trade is the exchange of goods and services across international boundaries or territories. In most countries, it represents a significant share of GDP. While international trade has been present throughout much of history (see Silk Road, Amber Road), its economic, social, and political importance has been on the rise in recent centuries. Industrialization, advanced transportation, globalization, multinational corporations, and outsourcing are all having a major impact. Increasing international trade is the primary meaning of "globalization".
International trade is also a branch of economics, which, together with international finance, forms the larger branch of international economics.
|
Activities
The Cultural Environments, The Political and Legal Environments, and The Economic Environment
Tutorials
Readings
External Environment No business can isolate themselves from the external economic environment. Business has to take account of government economic policy, regulations and the state of the economy. In this section, the Virtual Bank advises you on how to make the best of all these factors. We explain relevant concepts and theories and also give you some worksheets to see how well you understand them all.
Follow the links below to the area you would like to look at in more detail:
1. Government policy - in this section we look at the different types of government policy, fiscal policy, monetary policy and supply-side policy.
2. Role of the Bank of England - in this section we look at how the Bank of England manage interest rates in the economy and the effects that these changes may have on businesses.
3. Economic indicators - what do all the different economic indicators mean and how important are they to businesses?
Each section has explanations of relevant theories and worksheets to help reinforce understanding.
See also
Political economy originally was the term for studying production, buying and selling, and their relations with law, custom, and government. Political economy originated in moral philosophy (e.g. Adam Smith was Chairman of Moral Philosophy at the University of Glasgow [1] ), it developed in the 18th century as the study of the economies of states - polities , hence political economy.
In contradiction to the theory of the Physiocrats , wherein land was the source of all wealth, some political economists proposed the labour theory of value (introduced by John Locke , developed by Adam Smith , and later by Karl Marx ), according to which labour is the true source of value. Many political economists also noted the accelerating development of technology , whose role in economic and social relations was important ( Joseph Schumpeter ).
In late nineteenth century, the term "political economy" was generally replaced by the term economics , used by those seeking to place the study of economy upon mathematical and axiomatic bases, rather than the structural relationships of production and consumption (cf. marginalism , Alfred Marshall ).
- History of the term
- Current approaches to political economy
- Disciplines related to political economy
- References
National System of Political Economy - Major work on political economy by Friedrich List.
Harmony of Interests -Work contrasting American System and British System of political economy by Henry C. Carey
History of Economic Thought - This compendium hosted by the New School has collected bios on over 500 economists and introductions to many schools of thought.
Global Political Economy Net Mailing lists and other reference material by scholars of "The Global Political Economy"
Political Economy of Space Development
New Political Economy Research Center, University of Sheffield .
The Murphy Institute, Tulane University .
The Center for Ethics and Entrepreneurship at Rockford College .
Constitutional Political Economy Most recent issues online.
George Mason University: Buchanan Center for Political Economy
Political Economic Research Institute, University of Massachusetts, Amherst
The Journal of Australian Political Economy
Discipline of Political Economy at The University of Sydney
Union for Radical Political Economy
The Center in Political Economy, Washington University, St. Louis
Global Social Change reports Includes reports on global political and economic change.
From political economy to scientific ecolonomics (2008)
Activities
Globalization and Society
Tutorials
Readings
Globalization - the growing integration of economies and societies around the world - has been one of the most hotly-debated topics in international economics over the past few years. Rapid growth and poverty reduction in China, India, and other countries that were poor 20 years ago, has been a positive aspect of globalization. But globalization has also generated significant international opposition over concerns that it has increased inequality and environmental degradation. This site provides access to some of the most recent presentations on globalization and some of the leading research on the subject.
Making Globalisation Work For All | The Chancellor of the Exchequer, Gordon Brown, hosted an international conference at the Treasury on Monday, 16 February 2004. Sponsored by Lord Carey of Clifton and Lord Griffiths of Fforestfach, the conference will examine the challenges of making globalisation work for all. Delegates have been invited to attend from the faith, business, academic, NGO and diplomatic communities, as well as representatives from Government and Parliament. They will hear keynote addresses from Gordon Brown; Jim Wolfensohn, President of the World Bank; Bono; President Luis Inacio Lula da Silva of Brazil; and Hilary Benn, Secretary of State for International Development. Additional information . Globalization, Growth and Poverty: Building an Inclusive World Economy | Globalization has helped reduce poverty in a large number of developing countries but it must be harnessed better to help the world's poorest, most marginalized countries improve the lives of their citizens, says a new World Bank research report published today . Includes quotes from James Wolfensohn, President of the World Bank. (December 5, 2001) |
 |
See the video: (Quicktime 10.6 MG) | (Real Video 400K)
Listen to the radio: (Quicktime:
422K) | (MP3:
2.7 MB) |
(RealAudio:
355K)
Activities
A member of the Clandestine Rebel Clown Army protesting during the week of
the July 2005 G8 Summit, held at Gleneagles, near Edinburgh, Scotland.
Title: Edinburgh Prepares For Influx Of Protestors To G8 Summit.
Copyright: Getty Images, available from Education Image Gallery
International
Trade and Factor Mobility Theory
Tutorials
Readings
In Economic Theory, the various schools of economics aggregate what they consider to be the essential elements of production into broad classifications. These classifications have come to be referred to as factors of production . The number and definition of these factors will vary across the various schools as each school attempts to describe its particular theory of economics.
- Historical Schools and Factors
- A fourth factor?
- Free trade and movement of factors of production
- Human capital and intellectual capital
- Cost of production theory of value
- Factor world
- Labor theory of value
- Microeconomics
- Production, costs, and pricing
- Production theory basics
- Productivity world
- Resource-Based View
- References
Activities
Governmental
Influence on Trade
Tutorials
Readings
Economic Interventionism is a common term used to describe any activity, beyond the basic regulation of fraud and enforcement of contracts, undertaken by a government in an effort to affect a country's economy . Economic intervention can be aimed at a variety of political objectives, such as increasing economic growth, increasing employment, raising wages, raising or reducing prices, promoting equality, or addressing market failures .
Economic interventionism is generally a feature of governments run by social democratic and progressive parties, which believe that certain market outcomes are undesirable and ought to be mitigated.
Activities
Cross-National Cooperation and Agreements
Tutorials
Readings
Approaches to International Business
Strategic control is a systematic way of relating to the future. The major difference between national and international strategic management lies in the challenge presented by the unique characteristics of each national market. The ultimate success of the strategic function will depend upon: 1. The organisation's commitment to international business. 2. The level of involvement. 3. The status of international business within the organisation (secondary to home-market requirements or "the hope for the future").
The decision to go international From a survey of 231 companies (Piercy) it would appear that the decision to "go international" is not a rational seeking after business opportunity but rather the result of a series of chance decisions. Piercy suggests six stages:
|
 |
Activities
Global
Foreign Exchange and Capital Markets
Tutorials
Readings
The banking and capital markets sector
is being transformed by increased competition, regulation
and globalisation.
Investment banking is bouncing back strongly as acquisition activity gathers
momentum. While still highly profitable, the outlook for retail banking appears
to be clouded by concerns over consumer debt and the slow down of economic growth.
The impetus for further consolidation is growing as a result of margin pressures
on the one hand and - thanks to soaring profits and steadily
rising share values - the surge in available capital on the
other. The outlook for the banking & capital markets sector is also being
shaped by regulation including the move to Basel II. These challenges have heightened
the importance of effective risk management in delivering stable returns and
supporting robust governance and compliance processes.
Banking & capital markets challenges
- Governance & risk management
- Growth
- Human capital
- Market reporting
- Mergers & acquisitions
- Regulation & compliance
Activities
Foreign currency markets deal in billions of pounds worth of transactions every day -
the values of currencies are always changing - to be a successful trader you have to
think on your feet! A few seconds might mean the difference between a gain or a loss
of millions of pounds! Copyright: Neil Gould, from stock.xchng .
The
Determination of Exchange Rates
Tutorials
Readings
Activities
The
Strategy of International Business, Country
Evaluation and Selection, Export
and Import
Tutorials
- The Strategy of International Business
- Country Evaluation and Selection
- Export and Import Strategies
Readings
- Center for International Business Education and Research (CIBER)
- International Business
- Global Resources
- Strategy
- Why Use the Web to Study Strategy?
- Online
Courses in Strategic Management
- Paul Miesing's Strategic Management Course
- Further References
- Scholarly
Societies and Professional Associations
- Business Policy and Strategy Division of the Academy of Management
- Further References
- Publishers
and Strategy Textbooks
- Prentice Hall Business Publishing
- Further Reference
- Journals
and Electronic Journals
- Strategic Management: Text and Tools for Business Policy
- Further References
- Government
- Small Business Service
- Further References
- Strategic
Consultancy Organisations
- Strategos
- Further References
- The Strategy
Process: Online Guides
- NASA Strategic Management Handbook
- Further Reference
- Innovation,
Technology and Competition
- University of Warwick Business Processes Resource Centre
- Further References
- Learning
and Knowledge
- A Business Researcher's Interests (BRINT)
- Further Reference
- International
Business
- Center for International Business Education and Research (CIBER)
- Further Reference
- Small
and Medium Sized Enterprises
- eWeb at St Louis University
- Further References
- The Social
and Ethical Environment of Business
- Institute for Business and Professional Ethics at DePaul University
- Further References
Activities
Direct Investment and Collaborative Strategies. The Organization of International Business
Tutorials
Readings
Foreign direct investment (FDI) or foreign investment refers to long term participation by country A into country B. It usually involves participation in management, joint-venture, transfer of technology and expertise. There are two types of FDI: inward foreign direct investment and outward foreign direct investment, resulting in a net FDI inflow (positive or negative) and "stock of foreign direct investment", which is the cumulative number for a given period. Direct investment excludes investment through purchase of shares.[1]
- History
- Types
- Methods
- Foreign direct investment in the United States
- Foreign direct investment in China
- Foreign direct investment in India
- Foreign direct investment and the developing world
A Strategic Alliance is a formal relationship formed between two or more parties to pursue a set of agreed upon goals or to meet a critical business need while remaining independent organizations.
Partners may provide the strategic alliance with resources such as products, distribution channels, manufacturing capability, project funding, capital equipment, knowledge, expertise, or intellectual property. The alliance is a cooperation or collaboration which aims for a synergy where each partner hopes that the benefits from the alliance will be greater than those from individual efforts. The alliance often involves technology transfer (access to knowledge and expertise), economic specialization [2] , shared expenses and shared risk.
 |
A joint venture (often abbreviated JV ) is an entity formed between two or more parties to undertake economic activity together. The parties agree to create a new entity by both contributing equity, and they then share in the revenues, expenses, and control of the enterprise. The venture can be for one specific project only, or a continuing business relationship such as the Sony Ericsson joint venture. This is in contrast to a strategic alliance, which involves no equity stake by the participants, and is a much less rigid arrangement.
The phrase generally refers to the purpose of the entity and not to a type of entity. Therefore, a joint venture may be a corporation, limited liability company, partnership or other legal structure, depending on a number of considerations such as tax and tort liability.
 |
Activities
Marketing Globally, Global Manufacturing and Supply Chain Management
Tutorials
Readings
The Oxford University Press defines global marketing as " marketing on a worldwide scale reconciling or taking commercial advantage of global operational differences, similarities and opportunities in order to meet global objectives." Oxford University Press' Glossary of Marketing Terms.
|
|
Electing the markets
The organisation should resist the temptation to attack too many markets, thereby spreading effort and resources too thinly to be successful. The initial effort should be directed at a single market and then this can be extended to other, possibly neighbouring, markets. Market selection can be based on three key criteria:
Market potential e.g., market size, state of competition, customer needs and wants, channels of distribution, agents, financial and human resources, etc.
Similarity: to either the home market or other foreign markets. "Psychological" proximity is often more important than geographical proximity in international business. Regardless of the efforts the organisation may make to adapt, it will still find it easier to function in markets which have similar characteristics to its domestic market. "Feeling at home", however, does have its disadvantages - management may be tempted to take too much for granted and ignore subtle but critical environmental differences. This false sense of security has traditionally produced the most spectacular international business disasters.
Accessibility: encompasses both geographical distance (affecting delivery time and management communications, etc.) and political distance (legal and technical import controls, political constraints on business, etc.).
General sites recommended for global market info/country info:
Global EDGE
An excellent site for region or country information. Well stocked source of
information for international business that includes country data, market
potential indicators for emerging markets, glossary and much more. Produced
by the Center for International Business Education and Research at Michigan
State University. To search for relevant country information - click on 'Multicountry.
http://globaledge.msu.edu/ibrd/ibrd.asp
Strategis
An interesting Canadian site offering a wide range of valuable information
on numerous trade topics including economic data, market research reports,
legal issues and much more. This site has many strong resources related to
international trade including several good facts and statistics pages covering
many industries. Also available is an outstanding feature called Trade
Data Online that allows users to build country specific market reports
and graphs showing imports and exports for Canada and the U.S.A. that can
be examined by product category. Curiously, while the service is free on
this site the same information from STAT-USA requires a fee.
http://strategis.ic.gc.ca/engdoc/main.html
Offstats
A collection of links to statistical information from around the world. This
site can be searched by country, region and topic or industry. http://www.library.auckland.ac.nz/subjects/stats/offstats/
EU
The gateway to relevant data about EU and EU countries. Select your preferred
language on the first page of the site. http://europa.eu/
Virtual International Business and Economic Sources
(Vibes)
This site offers links to over 2,800 Internet sources of international business
and economic information. From UNC-Charlotte. http://library.uncc.edu/vibes/
Europages (European Business Directory)
A searchable directory of 700,000 European businesses in 35 European countries. http://www.europages.com/
Operations Management - Global Supply Chain Management
The world of manufacturing is becoming ever more global. In the search for lower costs, greater flexibility and reduction of local risk, operations managers are increasingly looking to source and manufacture components and services on a global scale.
Assignment
Compare and contrast concentrated one-country manufacturing to distributed global manufacturing. What are the strategic and operating advantages and disadvantages?
Students may like to search for similar sites using keywords such as:
global supply chain management, lead times, order quantities, shipping, air freight, global communications
Activities
International
Accounting Issues, The
Multinational Finance Function, Human
Resource Management
Tutorials
Readings
The International Accounting Standards Board (IASB) founded on April 1, 2001 is the successor of the International Accounting Standards Committee (IASC) founded in June 1973 in London . It is responsible for developing the International Financial Reporting Standards (new name for the International Accounting Standards issued after 2001), and promoting the use and application of these standards.
The International Accounting Standards Board is an independent, privately-funded accounting standard-setter based in London, UK.
- Website
- http://icap.org.pk The Institute of Chartered Accountants of Pakistan (ICAP)
- Accounting Standards Board of Japan
- Australian Accounting Standards Board
- Accounting Standards Board - ZA
- Accounting Standards Review Board - NZ
- Federal Accounting Standards Advisory Board - US
- Financial Accounting Standards Board - US
- Malaysian Accounting Standards Board
- The Accounting Standards Board Limited - UK
- International Public Sector Accounting Standards Board - US
- IFRS List - The online community about IFRS/IAS and Auditing
- Explication of the nomination of the IASB to a corporate irresponsibility award
- The Public Eye Award, to which the IASB has been proposed for nomination in 2008
- The Institute of Chartered Accountants of India (ICAI) Accounting Standards
- Iranian accounting standards board
 |
Rethinking Bank Regulation Till Angels Govern
Check the availability and buy your books from our Bookshop. |
International finance is the branch of economics that studies the dynamics of exchange rates , foreign investment , and how these affect international trade . It also studies the international projects, international investments and the international capital flows. It includes the study of futures, options and currency swaps.
See also
External links
- Center for International Finance & Development University of Iowa research center, includes a 300 page E-book.
- Institute of International Finance The Global Association of Financial Institutions; fostering global financial stability.
Activities
Human resource management (HRM) is the strategic and coherent approach to the management of an organization's most valued assets - the people working there who individually and collectively contribute to the achievement of the objectives of the business.[1] The terms "human resource management" and "human resources" (HR) have largely replaced the term "personnel management" as a description of the processes involved in managing people in organizations.[1] In simple words, HRM means employing people, developing their capacities, utilizing, maintaining and compensating their services in tune with the job and organizational requirement.
- Features
- Academic theory
- Business practice
- Careers and education
- Professional organizations
- Functions
- See also
- References
Recommended texts
 |
International Business, 11/e Daniels . Radebaugh . Sullivan Check the availability and buy your books from our Bookshop. |
 |
The Globalization of World Politics Second Edition Edited by John Baylis, Professor and Head of the Department of Politics and International Relations, University of Wales, Swansea, and Steve Smith, Pro Vice Chancellor and Professor of International Politics, University of Wales, Aberystwyth The web links are organized by part section, and then by chapter. Check the availability and buy your books from our Bookshop.
|
 |
International
Dimensions of Organizational Behavior,
4e Adler, Nancy J. McGill University
Check the availability and buy your books from our Bookshop. |
 |
Global
Marketing
A Decision-Oriented Approach Svend Hollensen Apr
2007 , Paperback , 752 pages Check the availability and buy your books from our Bookshop.
|
Resources
Links
Click on image if you need a PowerPoint Viewer
|
