International business by czinkota 7ech20

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:
Those Who Grow

Those Who Create

Those Who Make

Those Who 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.
18


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, e-mail,
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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