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9e daftchapter4


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9e daftchapter4

  2. 2. Managing in a Global EnvironmentCHAPTER 4
  3. 3. chapter4 Learning Outcomes• Describe the emerging borderless world and some issues of particular concern for today’s managers.• Describe market entry strategies that business use to develop foreign markets.• Define international management and explain how it differs from the management of domestic business operations.• Indicate how dissimilarities in the economic, sociocultural, and legal- political environments throughout the world can affect business operations.• Describe how regional trading alliances are reshaping the international business environment.• Describe the characteristics of a multinational corporation.• Explain cultural intelligence and why it is necessary for managers working in foreign countries. 3
  4. 4. Are You Ready To Workchapter4 Internationally? • Cross-cultural skills are extremely important • Every manager needs to think globally • The future of business and society is being shaped by global relationships • A global mind-set is becoming a prerequisite for managers 4
  5. 5. chapter4 A Borderless World • Isolation from international forces is no longer possible – Trade barriers are falling – Communication is faster and cheaper – Consumer tastes are converging • Virtual connections enable close, rapid coordination among people working in different parts of the world 5
  6. 6. chapter4 Four Stages of Globalization 6
  7. 7. Strategies for Enteringchapter4 International Markets • Exporting – transfers products for sale in foreign countries • Global Outsourcing – transferring the labor of specific tasks to low cost countries • Licensing – allowing an operation in another country to produce and sale company products • Franchising – providing a foreign organization with package of materials and services • Direct Investing - a production facility in another country 7
  8. 8. Getting Startedchapter4 Internationally 8
  9. 9. chapter4 China Inc. • Opportunities in China are booming • Companies are engaging in all strategies – The most common practice is outsourcing • Multinationals are manufacturing a large variety of products in China • China is attractive for low-cost manufacturing • India is attractive in software design, services and engineering • An author has named the phenomenon Chindia 9
  10. 10. Key Factors in Thechapter4 International Environment 10
  11. 11. chapter4 The Economic Environment •• Economic development differs around Economic development differs around the world the world – Countries can be categorized as developed or – Countries can be categorized as developed or less-developed less-developed •• Companies must be able to access the Companies must be able to access the resources needed to produce their resources needed to produce their products products •• Volatility in exchange rates can impact a Volatility in exchange rates can impact a businesses bottom-line businesses bottom-line 11
  12. 12. World Economic Forumchapter4 Global Competitiveness 12
  13. 13. The Legal-Politicalchapter4 Environment  Government supervision  Political instability  Laws and regulations 13
  14. 14. The Socioculturalchapter4 Environment  Shared knowledge  Beliefs  Values  Modes of behavior Values and behaviors from the US do not translate around the world 14
  15. 15. Country Ranking andchapter4 National Value Systems 15
  16. 16. Hofstede’s Valuechapter4 Dimensions National value systems that influence organizational and employee working relationships Power Uncertainty Distance Avoidance Individualism Masculinity/ and Femininity Collectivism 16
  17. 17. GLOBE Project Valuechapter4 Dimensions Global Leadership and Organizational Behavior Effectiveness (GLOBE) • Assertiveness • Future Orientation • Uncertainty Avoidance • Gender Differentiation Extension of • Power Distance Hofstede’s assessment • Societal Collectivism • Individual Collectivism • Performance Orientation • Humane Orientation 17
  18. 18. Country Rankings andchapter4 GLOBE Rankings 18
  19. 19. chapter4 Communication Differences • Some cultures pay more attention to the social context of communication – Social Setting – Nonverbal Behavior – Social Status • High-context cultures are sensitive to social exchanges • Low-context cultures use communication to exchange facts and information 19
  20. 20. High-Context and Low-chapter4 Context Cultures 20
  21. 21. Other Culturalchapter4 Characteristics  Language  Religion  Social Organization  Education  Attitudes 21
  22. 22. International Tradechapter4 Alliances • General Agreement on Tariffs and Trade (GATT) – Signed in 1947 by 23 nations – Nondiscrimination, clear procedures, negotiations and disputes regarding trade • World Trade Organization (WTO) – Permanent global organization from GATT – As of July 2007: 151 Countries • European Union – Begun in 1957 to improve economic and social conditions in European Economic Community – Evolved into the 27-nation European Union – Goal is to develop single market system • North America Free Trade Agreement (NAFTA) – United States, Canada, and Mexico – Trading bloc to spur growth and investment 22
  23. 23. The Nations of thechapter4 European Union 23
  24. 24. chapter4 The Globalization Backlash • As the world becomes more global, a backlash is growing • 68% of American say other countries benefit more from trade • One of the key concerns is job loss • Many argue that globalization benefits the economy 24
  25. 25. chapter4 Multinational Corporations • More than 25% of its total sales revenue come from outside the home country • In 2007, 42% of the global sales of US multinationals come from their foreign affiliates • An MNC is managed as an integrated business system • MNCs are controlled by a single management authority • MNC managers have a global perspective 25
  26. 26. Managing In A Globalchapter4 Environment • Developing Cultural Intelligence – Cultural flexibility and ability to adapt – Cognitive, emotional and physical • Managing Cross-Culturally – Expatriates can be successful by focusing on: • Human Resources • Leading • Decision Making • Motivating 26