Globalization has become a hot-debated issue in the last ten to twenty years. Globalization is affecting the world from different perspectives, such as political perspective, economic perspective, and cultural perspective. Currently, whether globalization can bring more positive effects or negative effects to the modern world is still open to debate. Different scholars around the world hold distinctive views regarding the definition of globalization, but in this article, the following two definitions are used. Globalization refers to the creation and intensification of global linkages. In addition, globalization also refers to the compression of the world and the intensification of consciousness of the world as a whole. One of the main ideas of globalization is to break the barriers between countries. Everyone can receive information about different events happening in the world instantly. In the era of globalization, breaking barriers between countries is inevitable. Trading, foreign investments, population movements, these activities across Continue reading
International Business Management
Business-Government Relationships – Meaning, Advantages, and Disadvantages
The success of any business around the world depends on a wide-range of factors, some of which may be from the internal or external business environment. For this reason, business owners and managers have no option but to try and understand the underlying factors, which are essential in defining the progress and future performance of the business. From the manner in which a firm treats its customers, to its relationship with internal stakeholders, it is necessary to underscore how various factors are generally intertwined in any business market. The question we ought to ask is the need for establishing a relationship with the government when running a business. The manner in which governments relate with the business world has remained debatable for several years, presenting two sides of a coin in which debaters view the advantages and demerits of enhancing such relationships in any setup. This is based on the fact Continue reading
Attributes of Sound Performance Measurement System
Multinational Enterprises need to measure performance of all its organizational participants/elements and subsidiaries. Efficacy of organizational control depends on efficient measurement of performance. A right selection of a range of performance measures which are appropriate to a particular company/context is needed. This selection ought to be made in the light of the company’s strategic intentions which will have been formed to suit the competitive environment in which it operates and the kind of business that it is. There are at least three major attributes expected of any good performance measurement system. These are: Reliability, Validity and Objectivity. Each characteristic is examined in detail. 1. Reliability Reliability of a measurement mechanism refers to the dependability or consistency of the measures provided by it. It refers to “the accuracy of the data in the sense of their stability, repeatability, or precision” There are two ways of looking at dependability. One is comparability Continue reading
International Strategic Alliances – Motivation, Advantages, and Disadvantages
An alliance can be defined as a business to business collaboration. In an alliance two or more companies agree to work together to achieve a common goal while not losing their individuality. Strategic alliance helps the both parties to gain the complementary strengths. Companies form alliances for joint marketing, joint sales or distribution, joint production, design collaboration, technology licensing and research and development. Strategic alliances have different forms, Contractual (non-equity- based) alliances (Alliances which are based on contracts and which do not involve the sharing of equity), Equity-based alliances (Strategic alliances which involves the use of equity), Cross-shareholding (Both partners invest in each other). One form of Equity-based strategic alliances is the joint venture. The formation of the alliance is rich and fragmented. One of the main reasons behind the collaboration is to gain the competitive advantages. Intermediate asset specificity and low uncertainty are conditions that may lead to a preference Continue reading
New Trade Theory of International Trade
New Trade Theory of International Trade takes a different approach from the Ricardian and the Heckscher-Ohlin models on why countries engage in international trade. Both Ricardo and Heckscher assumed constant returns to scale where to them if all factors of production are doubled then output will also double. But a firm or industry may have increasing returns to scale or economies of scale in way that when all factors of production are doubled, output more than doubles which will necessitate a bigger market and thus forcing firms to engage in international trade where there is a larger market. The New Trade Theorist noted that the bigger the size of a firm or industry the more the efficiency of its operations in that the the cost per unit of output falls as a firm or industry increases output. The increase in output must however be met with an increase in the Continue reading
Relevance of Sustainable Development Goals (SDGs) for Businesses and Organizations
The organizations have been focused towards adopting key business approaches and practices that would contribute towards their improved revenue as well as profitability in the marketplace. In order to achieve such strategic goals to revenue and operational growth, it is required by the management to identify and understand the changing market needs, as well as the stakeholder preferences and accordingly the internal business or operational strategies, are to be defined. Considering such need, it can be reflected that in the present marketplace there is a need for the business organization to focus towards the increased social preferences and need towards sustainability and societal development along with that of the business growth. The approach to sustainability ensures that the business organization have a balanced approach towards society, business as well as the environment. Further to strengthen the approach to sustainability international organizations including United Nations (UN) has defined several key sustainable Continue reading