New methods of outsourcing are today redefining the way of working. Co-sourcing is a situation of partial outsourcing, in which a business function or process is performed by both internal staff and by an external party or external resources, such as consultants or outsourcing vendors, with specialized knowledge of the business function. Compared to full outsourcing, for the traditional owner of the processes, co-sourcing has advantages of staying in control, a non-transactional partnership and the ability to grow the own knowledge level of the co-sourced process. One such way is co-sourcing which is an investment relationship marked by shared objectives, shared risks and shared rewards between two companies, one of which is a service provider. Specifically, the service provider would have to help restructure the company and be willing to make new investments, while driving out costs from the co-sourcing company’s existing ways working. Although it may seem similar to Continue reading
International Business
International Business Management deals with the maintenance and development of a multinational operation across national borders, whose manager has the knowledge and the skills to manage and handle cross-cultural processes, stakeholders and business environments in a right way.
Syndicated Loan – Syndicated Lending Process
Syndicated form of raising finance came into existence when the size of individual loans got bigger and banks thought fit to share the risks with other lenders. The concept of sole bankers was no longer feasible when a large amount of funding was involved. Moreover the syndicated mode of financing has two important features, namely, amount (risks) and administrative saving (documentation to be one principal lender). There will be one principal lender who will finance and the other participant lenders in the syndicate will share the risks in a predetermined share. Governments of countries as well as the corporate sector are tapped the syndicated loan route. As the size of the individual loans increased, individual banks found it difficult to take the risk single handed-regulatory authorities in most countries limit the size of the individual exposures. Hence the practice of inviting other banks to participate in the loan, to form Continue reading
Multinational Corporations Adaptability to Host Environments
All Multinational Corporations (MNCs) are not equally likely to cause friction and tension in their host economies. Some adapt with relative ease and become closely integrated with their host environment, both economically and socio-culturally; others remain isolated and insulated, often forming alien enclaves in the host society. There appears to be a causal relationship between the MNC’s organizational structure that is, its organizational design as well as its underlying objectives and strategies and its capacity for social adaptation to host country conditions. In terms of inducement to social conflict, MNCs fall into three categories: home dominated, host dominated, and internationally integrated. Home or Parent Dominated MNCs These enterprises are organized and managed in such a way that the foreign based subsidiaries and other affiliates, whatever their specific legal form, serve primarily in a complementary support role. Their function is to help the parent company achieve its business objectives in the Continue reading
Marketing Strategies Adopted by Global Companies
Marketing strategies adopted by Global Companies can be broadly classified as follows: 1. A Global Strategy It treats the world as a single market. This strategy is warranted when the forces for global integration are strong and the forces for national responsiveness are weak. This is true of the consumer electronics market, for example, where most buyers will accept a fairly standardized pocket radio, CD player, or TV. Matsushita has performed better than GE and Philips in the consumer electronics market because Matsushita operates in a more glob ally coordinated and standardized way. 2. A Multinational Strategy It treats the world as a portfolio of national opportunities. This strategy is warranted when the forces favoring national responsiveness are strong and the forces favoring global integration are weak. This is the situation in the branded packaged-goods business (food products, clean ing products). Unilever can be cited as a better performer than Continue reading
Marine Insurance – Meaning, Definition and Types
Marine insurance is a contract of indemnity whereby the assurer or underwriter agrees, for a stated consideration, known as the premium, to protect and indemnify the shipper and/or owner of the goods against loss, damage, or expense in connection with the goods at risk, if the damage is caused by perils specified in the contract known as the policy of insurance. When the goods have left the shipper’s plant or warehouse and are in the course of transportation, shipper has no physical means for the protection of these goods and must rely upon the ability of the transportation company to which he entrusts them for safe delivery at their intended destination. In addition, there are perils and hazards which the goods may encounter and which are beyond control of the carrier. Hence the importance of marine insurance can well be appreciated. The carrier in export trade is not an insurer Continue reading
The 10-P Framework of Global Strategic Management
The 10-P framework for globalization symbolizes the aspirations and needs of employees and organizations in the new competitive settings. It comes a long way from the initial impetus provided to the subject by Michael Porter in his book Competitive Strategy (1980), and goes beyond his purely industrial organization perspective. The framework operationalizes the 4-Diamonds for a nation’s competitive advantage of Porter. The 10-P framework integrates theory of strategic management and practice of business policy and provides a structure for the practicing manager to evaluate competitiveness at regular intervals. The 10-P framework explores a fine `fit’ between the soft and hard strategic choices. It seeks a self-motivated network of stakeholders who are able to self-actualize a high sense of satisfaction, self-worth, liberty and freedom in business organizational settings. True to the vision of a world-class organization, the central fulcrum in the framework is a PEOPLE-ORIENTATION – both inside and outside the Continue reading