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Business
Environments & Operations
15e
Daniels
Radebaugh
Sullivan
1-1
Chapter 1
Globalization and
International
Business
Copyright 2015 Pearson Education, Inc.
1-2
Learning Objectives
1-3
Introduction
Learning Objective:
Define globalization and international
business and explain how they affect each
other
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Introduction
Globalization is the widening set of
interdependent relationships among
people from different parts of a world
divided into nations
The term sometimes refers to the
elimination of barriers to international
movement of goods, services, capital,
technology, and people that influence the
integration of world economies
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Introduction
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Introduction
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Introduction
Factors in International Business Operations
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Costs of Globalization
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Costs of Globalization
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To expand sales
To acquire resources
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sales expansion
resource acquisition
risk minimization
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Modes of Operations in IB
Learning Objective:
Illustrate the different ways a company
can accomplish its global objectives
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Modes of Operations in IB
Merchandise exports
Merchandise imports
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Modes of Operations in IB
Service exports
provider and receiver of payment
Service imports
recipient and payer of payment
Examples
Tourism and transportation
Service performance
turnkey operations and management
contracts
Asset use
licensing and franchising
Copyright 2015 Pearson Education, Inc.
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Modes of Operations in IB
Investments
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Modes of Operation in IB
Collaborative arrangements
Joint ventures
Licensing arrangements
Management contracts
Minority ownership
Long-term contractual arrangements
Strategic alliance
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Types of International
Organizations
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Types of International
Organizations
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Why IB is Different
Learning Objective:
Recognize the need to apply social science
disciplines to understand how international
and domestic business differ
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Why IB is Different
The external environment affects a
companys international operations
Managers must understand social science
disciplines and how they affect functional
business fields
Consider
physical factors
social factors
competitive factors
Copyright 2015 Pearson Education, Inc.
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Geographic influences
Political policies
Behavioral factors
Legal policies
Economic forces
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Cost strategy
Differentiation strategy
Focus strategy
market leaders have more resources for
international operations
local or international
Copyright 2015 Pearson Education, Inc.
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Summary
Globalization is the widening set of
interdependent relationships among
people from different parts of a world
divided into nations
International business consists of all
commercial transactionsincluding sales,
investments, and transportationthat take
place between two or more countries
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Summary
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Summary
Political policies
Behavioral factors
Legal policies
Economic forces
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