Notesale: Turn your study into money

Document Preview

Extracts from the notes are below, to see the PDF you'll receive please use the links above

---

CHAPTER 1: Overview of International business and globalization

INTRODUCTION
Globalization: it is the widening set of interdependent relationships among people from different
parts of a world that happens to be divided into nations
...
People access to more varied resources, products, services and markets
...

HOW DOES INTERNATIONAL BUSINESS FIT IN?
Globalization enables us to get more variety, better quality, or lower prices
...
g our daily meals
contain spices that aren’t grown domestically and fresh produce that’s out of season in one local
climate or in another
...
Private companies undertake
such transactions for profit
...
Global
events and competition affect almost all companies
...

Understanding the environment/operations relationship
The best way to do business abroad may not be the same as the best way at home
...

Companies’ international operations and their governmental regulations affect overall national
conditions, as well as the success of individual industries and firms
...
:

1 A country’s interdependence must be measured indirectly,
2 When national boundaries shift, domestic business transactions can become international
ones and vice versa
...
Currently about the 25% of world production is
sold outside its country of origin
...
In periods of rapid economic growth, world trade
grows more rapidly than world production
...
Globalization is less pervasive than you might suppose
...

Such isolation is changing quickly
...
Moreover, the principal source of capital in most countries is
domestic rather than international
...
The studies’ results have several commonalities:

1 Smaller countries tend to be more globalized than larger ones,
2 Countries with higher-income populations tend to be more globalized,
3 A country may rank as highly globalized on one dimension, it may be lower on
another
...


These factors are interrelated
...
These include new products, as well as new application of old products
...

Why have technical developments increased so much?

 Population growth,
 Rising productivity: on average people can buy more by working the same number of hours
...
g
...

Many new products cannot easily take place in a single country
...
(e
...
a
noteworthy example of interdependent technology was the 2010 rescue of Chilean miners)
...

Advances in communication and transportation
Strides in communication and transportation now allow us to discover and desire products and
services developed in fare parts of the world
...
g
...
Innovations in transportation mean that
more countries can compete for sales to a given market
...
Improved communications and transportation also enhance a manager’s ability to
oversee foreign operations
...

2 Liberalization of Cross-Border trade and resource movements
To protect its own industries, every country restricts the movement across its borders
...
Over time, however, most governments
have reduced such restrictions, primarily for three reasons:
1
...
Competition spurs domestic producers to become more efficient,
3
...

3 Services that support international business
Companies and governments have developed a variety of services that facilitate global commerce
...
As a result, more companies are now responding to those markets where incomes and
consumption are growing most rapidly, such as China
...
Consumers are more
proficient today at scouring the globe for better deals, such as searching the Internet for lowerpriced prescription drugs abroad
...
(e
...
a firm might introduce products into markets where competitors are already
gaining sales, or seek suppliers where competitors are getting cheaper or more attractive products or
the means to produce them)
...
Born-global companies: companies that adopt a global
orientation from inception
...
Clustering or agglomeration: many new companies locate in

areas with numerous competitors and suppliers

---