Lecture management a pacific rim focus chapter 18 international management

Lecture outline• Nature of international management • Assessing the international environment • Gauging strategic issues • Organising international business • Adapting to cultural differ

CHAPTER 18

INTERNATIONAL MANAGEMENT

Lecture outline

• Nature of international management

• Assessing the international environment

• Gauging strategic issues

• Organising international business

• Adapting to cultural differences

• Social responsibility & ethical issues

Nature of international

management

• International business

Profit related activities conducted across

international boundaries.

• International management

Process of planning, leading, organising and controlling in organisations engaged in

international business.

Nature of international

management

Organisations engaging in international

management:

‘Organisations engaging in international

management vary in size and the extent

that their business activities cross

international boundaries’.

MULTINATIONAL CORPORATION (MNC)

Nature of international

management

Orientations towards international management:

• Ethnocentric

• Polycentric

• Regiocentric

• Geocentric

Nature of international

management

Orientations towards international management:

Ethnocentric

(home-country)

orientation

Ethnocentric

(home-country)

orientation

Geocentric (world) orientation

Geocentric (world) orientation

Regiocentric

(regional)

orientation

Regiocentric

(regional)

orientation

Polycentric (host-country) orientation

Polycentric (host-country) orientation

Assessing the international

environment

Assessing the international environment:

• Environmental elements

– Economic

– Legal-political

– Socio-cultural

– Technological.

• Competitive advantage of nations

Concept that environmental elements within a nation can foster innovation in certain industries, thereby increasing prospects for the success of home-based companies

operating internationally.

Assessing the international

environment

Economic Element

Less developed countries (LCDs) Developed countries

Newly industrialised countries (NICs)

Infrastructure

Balance of payments

Balance of Trade Exchange

Rate

Assessing the international

environment

Legal-Political

Element

Expropriation Political risk

Indigenisation

laws

Tariffs

Administrative

quotas

Assessing the international

environment

Sociocultural element

Cultural differences

Individualism-collectivism

Short-term orientation

Long-term orientation

Achievement-nurturing orientation

Technological

element

Technological transfer

Power distance

Gauging strategic issues

• Methods of international entry

Exporting, licensing, strategic alliances, wholly-owned subsidiaries

• Multinational corporation strategies

– World-wide integration

– National responsiveness

– Regional responsiveness

– Multifocal emphasis

Gauging strategic issues

Methods of

international

Entry

Exporting

Licensing

Strategic alliance

Wholly-owned subsidiary

Methods of international entry

Globalisation

National responsiveness

Regional responsiveness

Multifocal emphasis

Organising international

business

• World-wide functional divisions

• World-wide product divisions

• International divisions

• Geographic regions

• Global matrix

• Networked structure

Adapting to cultural differences

Managing international human resources

Assignment policies

Repatriation

Selection & training

Recruitment

Adjusting Leadership styles

Social responsibility & ethical

issues

political payments

bribes extortion

sales commissions

Questionable payment

issues

expediting payments

International Social responsibility

Lecture summary

• Nature of international management

Orientations: ethnocentric, polycentric, geocentric,

regiocentric

• Assessing the international environment

Environmental elements, competitive advantage of nations

• Gauging strategic issues

Methods of international entry, multinational strategies

Lecture summary

• Organising international business

Divisions: functional, product, international

Global matrix, network structure

• Adapting to cultural differences

International human resources

Adjusting leadership style

• Social responsibility & ethical issues

International social responsibility

Questionable payments