International Business

International Business Management deals with the maintenance and development of a multinational operation across national borders, whose manager has the knowledge and the skills to manage and handle cross-cultural processes, stakeholders and business environments in a right way.

International Asset Protection

Company’s investments and other assets in foreign countries may face the risk of expropriation. Governments are therefore concerned about the protection of the interests of their national companies in the foreign countries. The potential risk was more before the worldwide liberalization set in the 1980s.

Important protective measures in this respect include the following:

Coercion and Pressure

Until the Second World War, home countries used military force and coercion to ensure that host governments would give foreign investors prompt, adequate, and effective compensation in cases of expropriation, under a concept known as the international standard of fair dealing. It may be noted that the home countries of the companies involved were developed ones and the host countries were developing nations and these host countries had little to say about this standard.… Read the rest

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How Does International Business Differ From Domestic Business?

It is almost commonplace today to find businesses venturing into international markets. Thanks to advancements in communication and information technology, this trend will most certainly persist for the predictable future. The most domestic organization’s when considering expansion will usually look outside their geographical location. This usually means looking at opportunities in international markets. It is believed that managing and running a domestic business is less complex than undertaking international business for a number of reasons. Nation-states typically have unique laws governing trade and investment, variations in business ethics and culture, different political systems, monetary policies, currencies, and so on. And these are all possible factors that could make international business more complicated and therefore, riskier than doing business at home.… Read the rest

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Selection Criteria for International Assignments

Making an effective selection decision for an overseas assignment can prove to be a major problem. Typically, this decision is based on international selection criteria, which are factors used to choose international managers. These selections are influenced by the  Multinational Corporations experience and often are culturally based. Sometimes as many as a dozen criteria are used, although most  Multinational Corporations give serious consideration to only five or six.

1. Adaptability to Cultural Change

Overseas managers must be able to adapt to change. They also need a degree of cultural toughness. Research shows that many managers are exhilarated at the beginning of their overseas assignment.… Read the rest

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Competitive Advantage of Internationalization Strategies

First, the structure of competition is undergoing a profound change. Competitiveness is moving rapidly from a national to an international – indeed, global-scale. It is clear that, even with government purchasing, fewer segments of industry remain defensible at the national level in, for example, consumer electronics, telecommunications, transport technology and power engineering; and there is a growing list of sectors where companies are experiencing the benefits of value-added from design to sales. In some sectors, it can be in terms of designing products for many markets, thus lowering production costs earlier than is possible for purely national forms (worldwide designs can cover 80 per cent of customer needs, with 20 per cent for local adaptations).… Read the rest

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Internationalization Strategy Selection

Choice of the strategy does not consist merely of a collection of isolated decisions on products, markets, channels, partners and operation modes. These decisions are also core issues of a competitive strategy. Therefore, the choice of a strategy is all about choosing an appropriate framework for the growth and internationalization strategy for the company‘s competitive success. That is, the choice of strategy must be understood within the context of strategic planning.

The strategy of the firm is concerned with matching a firm‘s resources and capabilities to the opportunities and challenges arising from the external environment. This could just as easily be restated as, €•The choice of the growth and internationalization strategy is concerned with matching a firm‘s resources and capabilities to the opportunities and challenges arising from the external environment.… Read the rest

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Importance of International HRM

Various threats generated by the liberalization of an economy can be met only through bringing corresponding changes in management practices including practices related to International HRM. In the newer management practices, more emphasis has been given to International HRM because of the following factors:

1. Emphasis on Core Competency.

Post-liberalization, many organizations have started focusing on their core competence and businesses are being organized around that. Core competence is a unique strength of an organization that may not be shared by others. This may be in the form of unique financial resources (finance available at a much lower cost), manpower resources, marketing capability, or technological capability.… Read the rest

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