Master Of Business Administration Essay Example

in these countries to confidently venture into new markets. National recognition and protection of unique assets are also key aspects of this policy. Governments are actively leveraging distinctive resources like oil, copper, tin, and rubber, signifying a shift in industrial policy philosophy. This trend has significant implications for global competition. Additionally, the unrestricted exchange of technology is another important factor in this context.

The global competition has been boosted by the growing technology exchange among nations. China, Russia, and potentially India are emerging markets with immense potential for future growth. Having access to these markets will be a critical strategic factor for businesses in the future. Additionally, developing countries are enhancing their capabilities to make substantial investments in large-scale facilities. They actively seek to acquire or license the latest technology and are prepared to take significant risks.

The changing currents have made the international arena a competitive marketplace. The standards of competitive success have dramatically changed in recent decades. The pattern of international competition has become complex and different from previous strategies. These cross-currents include eroding comparative advantage, new forms of protectionism, government inducement, and proliferating coalitions among firms from different countries.

The increase in the number of firms embracing international strategies and operations in rowing is attributed to their capacity to adjust to local conditions. According to Porter, current strategies differ in themes and there is no standardized global strategy or international competition pattern. By 1986, globalization of competition had become the standard rather than the rare occurrence. In the past two decades, international competition has experienced a notable transformation. Nonetheless, numerous companies encounter organizational obstacles when implementing a global strategy.

The international environment

consists of multiple components, such as competitors, the economic system, the social system, the monetary system, the political/legal system, and the environmental system. Competitors greatly influence a business's profitability as they work towards distinguishing their products and delivering greater value for customers' money. The economic system is accountable for allocating scarce resources and encountering varying growth rates.

Businesses thrive in a thriving economy where living standards are improving. The social system encompasses the ideas, attitudes, and behavior patterns that influence human relationships. Consumer attitudes and behaviors, which are influenced by factors like population demographics and work-leisure dynamics, greatly impact businesses in areas such as earning, spending, saving, and borrowing. Money plays a crucial role as the lubricant for commercial activities. Business operations involve various relationships with financial institutions (e.g., banks and building societies), creditors, debtors, customers, and suppliers. The interest rate stands as a significant financial factor that affects businesses, as higher rates increase costs and limit spending. The political/legal system establishes the rules and frameworks under which businesses operate. While government policies encourage certain business activities like enterprise, they discourage others like excessive pollution. The environmental system represents the natural environment where life exists.

Businesses are recognizing the link between their economic activity, which involves generating profit through goods and services, and its influence on the environment. International businesses operate in three environments (domestic, foreign, and international) as opposed to one like domestic businesses. While environmental forces may be similar in domestic and foreign settings, they can have varying impacts and importance. This presents difficulties when evaluating decision outcomes due to uncertainty.

In order to function effectively in various countries, business leaders need to

understand the business concepts and techniques employed in both their home country and the host country. It is essential for these leaders to possess a comprehensive understanding of the environmental factors present in the host country. This comprehension aids them in deciding whether a concept or technique can be smoothly transferred to another country, if it requires modification to suit local conditions, or if it cannot be utilized at all.

The text examines the differences between international and domestic business environments. It suggests that business is now a global phenomenon, with expectations for this trend to continue. International business encompasses any business activity across national borders, including small firms engaging in single-country import/export and large multinational corporations with worldwide operations and partnerships.

The broad array of international firms can be categorized into different types, which helps in understanding their strategy, organization, and functional decisions. These decisions may include finance, administration, marketing, human resources, and operations. One way to distinguish between firms is by classifying them as multi-domestic operations. In this model, independent subsidiaries act as domestic firms but are interconnected. This classification can be visualized as two ends of a continuum with various capabilities in between.

Firms typically combine elements of multi-domestic and global operations, placing them in the middle of the continuum. Both domestic and international enterprises, in the public and private sectors, share the common goal of success and continued operations. Private enterprises also strive for profitability. However, there are distinctions between international and domestic business due to the variances across borders.

Nation-states vary in terms of government systems, laws, regulations, currencies, taxes, and responsibilities. They also possess distinct cultures and practices. When

individuals travel from their home country to a foreign one, they must possess the necessary documentation, carry foreign currency, communicate effectively in the local language, and adhere to appropriate dress codes. Similarly, conducting business in a foreign country encompasses these aspects and is more intricate than conducting business locally. LITERATURE REVIEW: Businesses operate within a broader context.

The business must respond to external factors or influences that occur beyond the factory and office walls. These external factors, also known as influences, will impact the business's internal functions, objectives, and strategies. The primary factor that influences businesses is the level of competition from other businesses producing similar products. Additionally, social factors, such as consumer behavior, household patterns, and community beliefs, can also affect the business.

The article discusses various factors that could impact a business, including changes in attitude towards health and an increase in the number of pensioners in a population. It also mentions the influence of legislation on businesses, such as changes in employment laws related to working hours. The economy is another crucial aspect as it affects businesses through taxation, government spending, general demand, interest rates, exchange rates, and global economic factors. Lastly, political changes in government policies can also have an impact on businesses, like a decision to provide subsidies for building new houses that could benefit local brick works.

Technological impacts businesses through the rapid pace of change in production processes and product innovation. Ethical aspects are concerned with determining what is morally right or wrong for a business to do, such as whether it should trade with countries with poor human rights records. The changing external environment leads to constantly

evolving markets that businesses must adapt to in order to retain customers. Market changes can be caused by customers developing new needs and wants, as well as the entry of new competitors.

New technologies enable the creation of new products. Various events such as the Gulf War or foot and mouth disease can have a nationwide or worldwide impact. While businesses generally do not desire competition, most will inevitably encounter some level of it. The extent and nature of competition depend on the market in which the business operates. In instances where there are many small rival businesses, such as in a shopping mall or city centre arcade, competition is intense. Conversely, in industries dominated by a few large rival firms, like the washing powder or soft drink market with Coke and Pepsi, competition is concentrated. Similarly, markets that experience rapid technological advancements, such as the mobile phone market, also face constantly changing competition.

A business can respond to increased competition, such as the launch of a rival product, by implementing various strategies. These include reducing prices, which may lead to decreased profits. Alternatively, they can choose to improve the quality of their products, even though this may result in higher costs. Another option is to invest more in promotion activities such as advertising to increase brand loyalty, despite the additional expenses involved. Additionally, businesses can reduce costs by utilizing cheaper materials or making some workers redundant. On a different note, each country has its own political environment that affects international trade and the relocation of foreign plants. Some countries actively pursue foreign companies and incentivize them to invest by offering reduced taxes or other

investment benefits.

Companies may encounter strict regulations in certain countries when they choose to operate in countries with better business conditions. It is crucial for companies to also evaluate the political stability of the host country's government. If the government undergoes a change or alters its stance on foreign trade and investment, it can pose significant challenges in recovering profits. Political instability often arises from harsh economic circumstances, leading to social unrest.

International trade presents challenges when it comes to payment in foreign currency. Fluctuating currency values can cause difficulties for companies, potentially resulting in financial losses if the value of a foreign currency decreases before it can be exchanged into the desired currency. Moreover, certain countries lacking sufficient cash may opt for counter trade, which involves exchanging goods directly or indirectly instead of using cash.

Counter trade, also known as bartering, has historical origins. An instance of counter trade is when a car company swaps new cars with a foreign government in exchange for high-quality steel instead of purchasing it at a costly price from the market. This steel can be utilized by the company to manufacture new cars that they can subsequently sell. Conversely, certain countries opt for self-sufficiency and refrain from engaging in free trade with other nations due to various reasons, primarily influenced by robust political ideologies.

The Soviet Union and its communist allies prioritized self-sufficiency to prevent potential Western influence through trade. This led to a scarcity of goods that were not produced within the group, resulting in a lower quality of life compared to the West due to unmet consumer demand.

After the Berlin Wall fell, trade with Western

countries resumed. Social change involves individuals in a community adjusting their attitudes and lifestyles. To adapt to these changes, businesses must modify their products. For example, they may decrease sugar levels in children's drinks because parents worry about too much sugar intake. Moreover, businesses should recognize their social obligations and think about how they interact with various societal groups.

Legislation encompasses various areas of responsibility that a business holds towards its customers, employees, and other businesses. It's equally essential to take into account the impact a business can have on the local community, referred to as social benefits and social costs. A social benefit occurs when a business action generates advantages that surpass the direct benefits to the business and/or customer. To illustrate, constructing an appealing new factory creates job opportunities for the local community.

A social cost, such as pollution, occurs when an action negatively affects society as a whole. These extra costs and benefits are known as externalities - they differ from the ones that directly impact businesses. Governments provide subsidies and grants, like regional assistance for underdeveloped areas, to support social benefits. They also discourage social costs through fines, taxes, and legislation. The political environment has played a role in reducing or eliminating product shortages and the economic environment is also affected.

Tariffs, which are essentially excise taxes on imported products, play a significant role in international trade. They are the most common form of tax imposed on imported goods. Countries may impose tariffs for various reasons, including generating revenue from items that are also produced domestically. These tariffs aim to provide income for the government and can be used for different

purposes. Typically, they are set at a low level and do not usually hinder international trade.

When domestic manufacturers face a disadvantage against imports, the government may implement a protective tariff. The intention of this tariff is to increase the cost of foreign goods and protect domestic companies. This measure is highly supported by affected domestic companies and their employees who directly profit from it. In response, the affected country frequently enforces its own tariff on an item originating from the nation that initially implemented the tariff.

In 1930, the U. S. Congress passed the Smooth-Hawley Tariff Act, allowing protective tariffs on imports to protect domestic producers from foreign competition. This tariff was well-received due to the Great Depression's onset, as it was perceived as aiding U.S. workers. However, other countries retaliated by immediately imposing their own protective tariffs on U.S. products.

Due to protective tariffs, global trade significantly declined for almost every nation, leading to a decrease in the wealth of each affected country and a rise in unemployment rates worldwide. Recognizing the error of the 1930 tariffs, Congress rectified the situation by enacting the Reciprocal Trade Agreements Act of 1934. This act granted the president authority to cut tariffs by 50 percent on products from any country that agreed to reciprocate with comparable tariff reductions. The objective was to stimulate international trade and foster greater collaboration among exporting nations.

Another trade barrier that a country can use to protect its domestic companies is a quota. This limits the amount of goods that a foreign country can export to the quota-enacting country. Additionally, a government can implement an administrative barrier to protect domestic companies.

This typically involves requiring licenses, permits, or extensive paperwork for imports into the country. Before a corporation starts exporting products to other countries, it must evaluate the cultural norms, taboos, and values of those countries.

Critical information that can influence the successful introduction, sales, and marketing of a product in a specific country is essential. This information can help prevent cultural blunders like the one experienced by General Motors with its Chevy Nova in Spanish-speaking countries. In Spanish, Nova means "doesn't go," leading to low car purchases and causing General Motors significant losses and embarrassment due to ignorance of the Spanish language.

Business professionals should also have knowledge of foreign customs pertaining to standard business practices. For instance, individuals from certain countries prefer to be in close proximity while conducting equines. Conversely, individuals from other countries prefer to maintain a spatial distance from those they are doing business with. Therefore, prior to traveling abroad, businesspeople must undergo training on conducting business in the specific country they are visiting. Additionally, business professionals may also encounter bribery as a prevalent practice in some countries.

Bribery is prevalent in multiple countries and is seen as a typical business practice. Failure to pay a bribe to a businessperson in a country where it is expected can impede progress. Anti-bribery laws exist in certain countries, making it crucial to navigate the legal and cultural landscape carefully to remain compliant. Additionally, factors connected to the physical environment impact international trading activities.

The geography of a region, including mountains and rivers, along with human-made structures like bridges and roads, can have an impact on global commerce. For instance, when there are natural

obstacles such as mountains and rivers in areas where potential customers reside, it becomes challenging to transport goods to the market. As a company grows, it establishes business methods that become ingrained in its decision-making processes and daily operations.

The work methods of employees are shaped by established practices, but the introduction of a new business strategy by organizations brings about change and alternative approaches. Marks & Spencer, a renowned British retailer with a rich history spanning over 120 years, operates more than 450 stores in the UK and has a workforce exceeding 65,000 individuals. Moreover, it is expanding its operations to locations as distant as Hong Kong beyond the UK.

In recent years, the retailing industry in Auk has faced fierce competition as customers have become increasingly discerning about where and how they shop, as well as the type of shopping experience they desire. Consequently, surviving in this environment has become challenging for retailers. Marks & Spencer, in response to these challenges, had to develop a new business strategy, which led to a period of organizational change. The focus of this change was to realign the business with its fundamental principles.

Marks & Spencer focused on three business values: Quality, Value, and Service. To promote these values, the company launched a campaign called 'Your M', which aimed to strengthen the connection between customers and the business's heritage. Additionally, this campaign associated the business with its other values of Innovation and Trust in the minds of customers. The strategy involved three main elements: developing desirable products for customers, investing in store environments, and providing excellent customer service.

The changes in the business environment have presented

employees with greater challenges. Managers had to ensure that employees were prepared for any role they may need to take on in this new environment. To address this, career paths were developed for the employees. This case study examines the training and development processes at Marks & Spencer and how they aided employees in overcoming challenges and establishing a career path.