International business 7e czinkota moffett ch20

Chapter 20
New Horizons

1


Learning Objectives
Understand the many
changing dimensions that
shape international business.
Learn about and evaluate the
international business
forecasts made by a panel of
experts.
Be informed about different
career opportunities in
international business.
2


New Horizons
The International Business
Environment
Globalization and Trade
Negotiations
Government Policy
The Future of International
Business Management
Careers in International Business
3

The International Business
Environment
Conditions of Change
in:
Politics
Finance
Society
Technology

4


The Political Environment
Transformations
Reshaping of
existing political
blocks.
Formation of new
groupings.
Breakup of old
coalitions.

5


Planned Versus Market Economies
Eastern and Central Europe will
continue to be attractive for
international investment.

The distinction between developed
and less-developed countries is
unlikely to change.
Environmental protection will be a
major force in economic growth.
Much of the growth of the global
economy will be fueled by the
emerging markets of the Asia Pacific
region.
6


A Divergence of Values
Nations hold differing
values and priorities.
Divergence of values
will require
readjustment of
activities of the
international
corporation.

7


International Finance
Debt constraints and low
commodity prices impose slow
growth prospects for developing
countries.

Developed nations have an
incentive to help debtor nations.
The United States is the largest
debtor nation in the world.
8


Effects of Population Shifts
Population increase
will become a
national priority in
the industrialized
world.
Population
stabilization
continues to be the
challenge in the
developing world.
9


Technological Environment
Internet is
democratizing global
business.
Small/medium-sized
enterprises can now be
full participants in the
global marketplace.
High technology is a

controversial area of
economic activity.
10


Globalization and Trade
Negotiations
Globalization will continue and
trade negotiations will continue
to experience difficulties.

11


Globalization and Trade
Negotiations

Long-term differentiation of
countries and firms includes:
ThoseWho
Who Grow
Grow
Those

Those
Those Who
Who Create
Create

Those Who

WhoMake
Make
Those

Those
Those Who
Who Coordinate
Coordinate
12


Government Policy
International trade activity now
affects domestic policy more than
ever.
Governments will need to
coordinate policies that affect the
international business
environment.
Policymakers need a better
understanding of the nature of
international trade issues.
13


The Future of International
Business Management
Global change results in an
increase in risk.
International markets remain a

source of high profits.
International executives will
need to balance the public and
the private good.
14


International Product Policy
Environmental concern is a key issue
affecting product planning.
Firms will have to plan for the “postmortem” stage in the product life
cycle.
Product life cycle will be measured in
months or even weeks.
Companies will have to deliver more
mass customization.
An increase will occur in the trend
toward strategic alliance.
15


International Communications
Advances made in international
communications will have a
profound impact on international
management. Most affected will be
members of the services sector.

16

Distribution Strategies
Innovation will determine new ways
of serving markets.
More sophisticated distribution
systems will also introduce new
uncertainties such as risk due to
distribution interruptions.

17


International Pricing
Will become increasingly heated.
Forward pricing will become
increasingly difficult.
Price competition will be substantial.
Exchange rate movements may play
a more significant role in
maintaining competitiveness.
Nations will attempt to stimulate
their international competitiveness
through subsidization, targeting, or
government contracts.
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Careers in International Business
-- To Prepare:
Be well versed in a specific functional

business area.
Take summer internships abroad.
Take language courses.
Obtain further in-depth training by enrolling
in International Business Courses!

19


Opportunities for Women in
Global Management
In the mid-1980’s women held
3.3% of overseas positions in
U.S. firms.
By 2000, 13% of expatriates
were women.
Expatriates are not seen as
women, but rather as
“foreigners who happen to be
women.”
Advantages are added
visibility and increased access
to clients.
20


Employment With A Large Firm
Employees are expected to be
grounded in the practice and
management of business.

Managers are sent abroad because
the company expects him or her to
reflect corporate spirit.
Employees returning from the
international route may find few
positions available back at
headquarters.
21


Employment With A Small Firm
May have recently developed an
international outlook.
With a more limited budget, most of
the work may be done by mail, fax, email, or by telephone.
International work may involve
importing.
Small firms provide excellent training
ground for international activities.
22


Self-Employment
The Opportunity to Become a True
International Entrepreneur
Specialized services that might
be offered by a consultant
include: international market
research, international strategic
planning, beginning-to-end

assistance for international
entry or international
negotiations. There may be a
higher degree of risk involved,
but there is also an opportunity
for higher rewards.
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