International mangement

1. McGraw-Hill/Irwin Copyright © 2011 by The McGraw-Hill Companies, Inc. All rights reserved.
InternationalInternational
ManagementManagement
Chapter SixChapter Six

2. The Global EnvironmentThe Global Environment
 The global economy is
dominated by countries
in three regions: North
America, Western
Europe, and Asia.
 Other developing
countries and regions
represent important
areas for economic
growth
6-2

3. The Global EconomyThe Global Economy
6-3Figure 6.1

4. European UnificationEuropean Unification
 Europe is integrating
economically to
form the biggest
market in the world
 Certain structural
issues within Europe
need to be
corrected for the EU
to function
effectively.
6-4

5. U.S. Trading PartnersU.S. Trading Partners
Based on Total Imports and ExportsBased on Total Imports and Exports
Figure 6.2
6-5

6. Consequences of a Global EconomyConsequences of a Global Economy
1. Expansion of international trade
2. Foreign direct investment (FDI) is playing an
ever-increasing role in the global economy
3. Imports are penetrating deeper into the
world’s largest economies
4. Companies are finding their home markets
under attack from foreign competitors
6-6

7. Factors to Consider for OffshoringFactors to Consider for Offshoring
 What is the competitive advantage of the
products they offer?
 Is the business in its early stages?
 Can production savings be achieved locally?
 Can the entire supply chain be improved?
6-7

8. Organizational ModelsOrganizational Models
6-8Figure 6.5

9. Comparison of Entry ModesComparison of Entry Modes
6-9Table 6.2

10. Managing across BordersManaging across Borders
 Expatriates
 Parent-company
nationals who are
sent to work at a
foreign subsidiary
6-10

11. Identifying International ExecutivesIdentifying International Executives
6-11Table 6.4

12. How to Prevent Failed Global AssignmentsHow to Prevent Failed Global Assignments
6-12
Table 6.5

13. Understanding Cultural IssuesUnderstanding Cultural Issues
 Ethnocentrism
 The tendency to judge
others by the standards
of one’s group or
culture, which are seen
as superior
 Culture shock
 The disorientation and
stress associated with
being in a foreign
environment.
6-13

14. Understanding Cultural IssuesUnderstanding Cultural Issues
 Power distance
 the extent to which a
society accepts the fact
that power in
organizations is
distributed unequally
 Individualism/collectivism
 the extent to which people
act on their own or as a part
of a group.
6-14

15. Understanding Cultural IssuesUnderstanding Cultural Issues
 Uncertainty avoidance
 the extent to which
people in a society feel
threatened by uncertain
and ambiguous
situations.
 Masculinity/femininity
 the extent to which a
society values quantity
of life over quality of life
6-15