This lecture discusses strategic management concepts for global and multinational businesses. It covers topics such as global strategic planning, challenges of doing business internationally, the importance of business ethics and corporate social responsibility, and sustainability issues like animal welfare. Specific points include defining globalization and multinational firms, the advantages and disadvantages of global business, cultural differences across countries, why good ethics are good for business, and ISO 14000 environmental certification standards.

1. JahanUniversity
BachelorofBusinessAdministration
Departmentof BusinessAdministration
Subject: Strategic Management
Lecture# Second
Lecturer: Hijratullah Tahir
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2. Objectives of the lecture
After compellation of this lecture students will be able to know:
1. Global strategic Planning
2. Global challenges and Strategic issues
3. Why good business ethics is good in business strategic planning
4. Why Corporate Responsibility and policy are key issues in
strategic planning
5. Why Animal welfare is a strategic issue for firms.
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3. Outline of the lecture
Topic 1: Globalization and Multinational firms
Topic 2: Advantages and dis-advantages of doing business globally
Topic 3: Business Culture across the countries
Topic 4: Why Good ethics is good in business
Topic 5: Whistle blowing, Bribery and Workplace romance.
Topic 6: Social Responsibility and Policy
Topic 7: ISO 14000/14001 Certification
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4. Globalization
Definition
• Is the process of doing business worldwide.
• Strategic decisions based on global profitability
• Satisfy global customers needs
• Focus on; Production in lowest cost countries, abundant
natural resources and other sources availability.
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5. Global strategy
• Global strategy includes designing, producing and marketing products
with global needs in mind. Instead of single country alone.
• Global strategy integrates actions against worldwide competitors.
• Global strategy focus on global buyers and sellers.
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6. Multinational Firms
• Organizations that conduct business operations across national
borders.
• Also called international firm
• Strategic Management Model is same for Multinational firms.
• The process is more complex; Social, Cultural, demographic,
environmental, political, legal, Technological etc.
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7. Advantages of doing business globally
1. Firms can gain new customers for their products.
2. Reduce unit costs and Spread economic risks
3. Foreign operation can allow firm to establish low cost productions.
4. Joint ventures and partnership
5. Larger scales production and higher sales volume.
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8. Dis-advantages of doing business globally
1. Firms confront various social. Political, cultural, economic,
demographic and other forces.
2. Foreign operations could be seized by nationalistic factions.
3. Language, culture and values system differs among countries.
4. Gaining an understanding of regional organizations such as EU, WTO,
WB, Etc.
5. Dealing with Two or more monetary system.
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9. Cultural pitfalls- useful for Managers
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10. Business ethics
Definition
• Principles of conduct within organizations that guide decision
making and behavior.
• Good business ethics is a prerequisite for good strategic
management;
• Good ethics is just good business!
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11. Corporate Social Responsibility and Sustainability
Corporate Social Responsibility;
• Refers to actions an organization takes beyond what is legally
required to protect or enhance the well-being of living things.
Sustainability;
• The extent that an organization’s operations and actions
protect, mend, and preserve rather than harm or destroy the
natural environment.
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12. Why “Good Ethics is Good Business”
• The IBE Research “Does Business Ethics Pay?” and concluded that
companies displaying a “clear commitment to ethical conduct”
consistently outperform companies that do not display ethical conduct.
• If you have integrity, nothing else matters. If you don’t have integrity,
nothing else matters.
• Good ethics is good business. Bad ethics can derail even the best
strategic plans.
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13. Whistle-Blowing
Definition;
• Refers to employees reporting any unethical violations they
discover or see in the firm.
• Employees should practice whistle-blowing, and
• Organizations should have policies that encourage whistle-
blowing
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14. Avoid Bribery
• Managers, employees, and firms must avoid bribery.
• A bribe is a gift bestowed to influence a recipient’s conduct.
• The gift may be any money, goods, actions, property, preferment,
privilege, emolument, object of value, advantage, or merely a promise
or undertaking to induce or influence the action, vote, or influence of a
person in an official or public capacity
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15. Workplace romance
• Workplace romance is an intimate relationship between two
consenting employees, as opposed to sexual harassment,
Sexual harassment;
• broadly as unwelcome sexual advances, requests for sexual favors, and
other verbal or physical conduct of a sexual nature.
• Sexual harassment (and discrimination) is illegal, unethical, and
detrimental to any organization.
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16. Social Responsibility and Policy
• Ralph Nader, who proclaims that organizations have tremendous social
obligations.
• ExxonMobil has more assets than most countries, and because of this,
such firms have an obligation to help society cure its many ills.
• Design and articulate a social policy
• Social policies on retirement
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17. Sustainability Reports
• A sustainability report reveals how a firm’s operations impact the
natural environment.
• Discloses to shareholders information about the firm’s labor
practices, product sourcing, energy efficiency, environmental
impact, and business ethics.
• No business wants a reputation as being a polluter. A bad
sustainability record will hurt the firm in the market.
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18. ISO 14000/14001 Certification
• Based in Geneva, Switzerland, ISO is a network of the national
standards institutes of 147 countries, with one member per country.
• The ISO is the world’s largest developer of sustainability standards.
• Widely accepted all over the world, ISO standards are voluntary
because it has no legal authority to enforce their implementation;
• The organization itself does not regulate or legislate
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19. Six Major Requirements of ISO 14001
1. Show commitments to prevention of pollution, continual improvement in overall environmental
performance, and compliance with all applicable statutory and regulatory requirements.
2. Identify all aspects of the organization’s activities, products, and services that could have a
significant impact on the environment, including those that are not regulated.
3. Set performance objectives and targets for the management system that link back to three
policies: (a) prevention of pollution, (b) continual improvement, and (c) compliance.
4. Meet environmental objectives that include training employees, establishing work instructions and
practices, and establishing the actual metrics by which the objectives and targets will be
measured.
5. Conduct an audit operation of the EMS.
6. Take corrective actions when deviations from the EMS occur
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20. Wildlife Welfare
1. Consumers globally are becoming increasingly intolerant of any
business or nation that directly or indirectly destroys wildlife,
especially endangered wildlife, such as tigers, elephants, whales,
songbirds, and coral reefs.
2. Affected businesses range from retailers that sell ivory chess pieces to
restaurants that sell whale meat.
3. Food suppliers and Animal welfare.
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21. Conclusion
• Globalization, Multinational firms
• Global Strategy, Advantages and dis-advantages of doing business
internationally.
• Business ethics, Corporate Social responsibility and sustainability.
• Workplace romance, Sexual harassment and Sustainable reports
• ISO 14000/ 14001 Certificates and Wildlife Welfare
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22. References
1. Strategic Management Concepts and Cases Sixteen Edition by
Fred R. David.
2. Fundamental of Business Management Process by Marlon
Dumas and Jan Mandelling.
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