MGMT 4070 Chapter 1 Study Guide

MGMT 4070 Chapter 1 Study Guide - NOTES 26 Jan 2008...

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NOTES 26 Jan 2008 International Operations: Management A. Globalism – Assessing the Environment Definition: The term Globalism or Globalization generally refers to global competition characterized by networks that bind countries, institutions and people. It is further characterized as competition in an increasingly borderless world. Global companies are becoming less tied to specific locations and their operations and allies are spreading around the world as they source and coordinate resources and activities wherever needed. Companies that desire to remain competitive will have to develop a cadre of experienced international managers. Benefits of Globalization: 1. Access to markets 2. Access of talent 3. Access to raw materials 4. Cost reduction Gayle Warwick Fine Linens: - Process control - High margins - Pilot runs for quality control Global strategies must include an assessment of the following environments: 1) Political 2) Economic 3) Legal 4) Technological 1) Political Risk: Any governmental action or politically motivated event that adversely affects the long-run profitability or value of a firms business Managers must understand the ethnic and religious composition of the host country in order to anticipate situations of political and general instability. Nationalism: the forced sale of the MNCs assets to local buyers with some compensation to the firm. Expropriation: when a local government seizes the foreign –owned assets of the MNC, providing inadequate compensation, if any at all
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Managing Political Risk: - Avoidance: a company’s choice to suspend or never establish operations in a country. -
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This note was uploaded on 03/04/2009 for the course MGMT 4070 taught by Professor Gordon,ken during the Spring '08 term at Colorado.

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MGMT 4070 Chapter 1 Study Guide - NOTES 26 Jan 2008...

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