MBAA 604 – International Business Administration - Case Study 3 - Moving Headquarters Overseas

MBAA 604 – International Business Administration - Case Study 3 - Moving Headquarters Overseas

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MBAA 604 – International Business Administration Case Study 3 – Moving Headquarters Overseas January 31, 2016 1. What are the drawbacks and benefits associated with moving business unit and corporate HQ to another country? Benefits of Moving Headquarters The decision to move a business’s headquarters to another country must take into account both the great opportunities and costs of relocation. As exemplified by the multiple successful companies mentioned in our textbook (Peng, pp. 419-420), there are an enormous number of advantages a business can secure by moving its headquarters. Externally, a company that wishes to rebrand itself as a global player can do so by establishing international headquarters. From its new location, a company can not only demonstrate that it is dedicated to reaching out globally in a general way, but also that it is committed to the region to which it has moved. An international move also positions a company for success in its country of choice, through greater access to local expertise, as well as financial and political leverage. Local strengths may include more affordable supply chains and deeper understanding of local markets, both of which can maximize a company’s investments of time and money. (Lessard et al.) Financially, a company can gain significant benefits from proximity to major financial centers such as London or New York (Peng p. 420). And politically, demonstrating intent to
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move to a foreign country can cause a company’s home country to extend financial incentives to not relocate. Drawbacks of Moving Headquarters As much as moving headquarters can afford many opportunities, a company must also weigh the associated risks. Moving is logistically complicated not only for physical resources, but human ones as well. In deciding to move, a company must determine if its key employees are willing to relocate.
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  • Fall '14
  • Globalization, Case Study, Corporation, Moving Headquarters Overseas, Moving Headquarters

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