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Business strategy in global economy

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Business strategy in global economy

Business strategy in global economy

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    Business strategy in global economy Business strategy in global economy Presentation Transcript

    • 12 Globalisation and Multinational Corporations
    • Multinational Corporations
      • Diversity among MNCs
        • size
          • the comparative size of MNCs and countries' GDP
    • Comparison of the 10 largest multinational corporations (by gross revenue) and selected countries (by GDP): 2002
    • Comparison of the 10 largest multinational corporations (by gross revenue) and selected countries (by GDP): 2002
    • Multinational Corporations
      • Diversity among MNCs
        • size
        • the nature of the business
    • Multinational Corporations
      • Diversity among MNCs
        • size
        • the nature of the business
        • overseas business relative to total business
    • Multinational Corporations
      • Diversity among MNCs
        • size
        • the nature of the business
        • overseas business relative to total business
        • production locations
    • Multinational Corporations
      • Diversity among MNCs
        • size
        • the nature of the business
        • overseas business relative to total business
        • production locations
        • ownership patterns
    • Multinational Corporations
      • Diversity among MNCs
        • size
        • the nature of the business
        • overseas business relative to total business
        • production locations
        • ownership patterns
        • organisational structure
    • Multinational Corporations
      • Diversity among MNCs
        • size
        • the nature of the business
        • overseas business relative to total business
        • production locations
        • ownership patterns
        • organisational structure
      • Trends in multinational investment
    • Multinational Corporations
      • Diversity among MNCs
        • size
        • the nature of the business
        • overseas business relative to total business
        • production locations
        • ownership patterns
        • organisational structure
      • Trends in multinational investment
        • the growth and geography of FDI
    • FDI inflows (% of gross fixed capital formation) FDI as % of gross fixed capital formation
    • FDI inflows (% of gross fixed capital formation) FDI as % of gross fixed capital formation Advanced countries
    • FDI inflows (% of gross fixed capital formation) FDI as % of gross fixed capital formation Advanced countries Developing countries
    • Multinational Corporations
      • Diversity among MNCs
        • size
        • the nature of the business
        • overseas business relative to total business
        • production locations
        • ownership patterns
        • organisational structure
      • Trends in multinational investment
        • the growth and geography of FDI
        • FDI and the UK
    • Direct investment into and out of the UK
    • Direct investment into and out of the UK Inward investment
    • Direct investment into and out of the UK Outward investment Inward investment
      • Types of multinational expansion
        • horizontally integrated multinational
        • vertically integrated multinational
        • conglomerate
      • Going global to reduce costs
        • international differences in input prices
        • international differences in productivity
          • labour skills
          • entrepreneurial and managerial skills
          • learning by doing
        • low-cost access to local markets
        • economies of scale
        • taking advantage of government policies
      Business Strategy in a Global Economy
      • Going global to access new markets
        • increased demand
        • spreading risks
        • can exploit advantages over local firms
          • ownership of superior technology
          • entrepreneurial and managerial skills
          • R&D capacity
        • access to local technology
        • learning from experience in diverse markets
      Business Strategy in a Global Economy
      • The product life cycle and the MNC
        • the launch phase
          • multinational spread likely to be limited
        • the growth phase
          • MNC likely to shift production abroad in order to retain cost competitiveness
        • maturity
          • MNC increasingly seeks markets abroad as growth in home market slows
        • late maturity and decline
          • MNC increasingly seeks both markets and ever lower cost production abroad
      Business Strategy in a Global Economy
      • Problems facing multinationals
        • language barriers
        • selling and marketing
          • cultural issues
        • relations with host governments
        • relationships between subsidiaries
          • possible diseconomies of scale
          • easier if subsidiaries are run independently
      • The global strategy trade-off
        • economies of scale of standardisation or higher costs of customisation?
          • determinants of trade-off
      Problems Facing Multinationals
    • MNC Investment and the Host State
      • Advantages of MNC investment
        • employment
        • balance of payments
        • technology transfer
        • tax revenues
      • Disadvantages
        • uncertainty
        • power and control by the MNC over the host
        • transfer pricing
        • the environment
    • Is Globalisation a 'Good Thing'?
      • The benefits of globalisation
        • benefits of trade
        • benefits of increased FDI
        • competition reduces costs and encourages innovation
        • faster spread of technology
        • political and social ties
      • The costs
        • can exacerbate inequality
        • erodes national cultures
        • environmental costs
        • domination by MNCs