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Lecture 3

Global Dimensions of Management- LECTURE 3.docx

4 Pages
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Department
Global Management Studies
Course Code
GMS 200
Professor
Bamidele Adekunle

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Global Dimensions of Management Lecture 3 &4 Culture and its relationship with global diversity  Understanding cultural differences (Trompenaars): - Universalism versus particularism - Individualism versus collectivism - Neutral versus affective - Specific versus diffuse - Achievement versus prescription  Attitudes toward time – sequential and synchronic views  Attitudes toward environment – inner directed and outer-directed cultures. Outline  The international management challenges of globalization  Forms and opportunities of international business  Definition of multinational corporations  Culture and its relationship with global diversity  The transfer of management practices and learning across cultures The international management challenges of globalization  Key concepts in the challenges of globalization: Global economy, Globalization, International management, Global manager.  Europe- European Union (EU)  The Americas – NAFTA, FTAA  Asia & Pacific  Africa & Pacific  Africa – SADC (South Africa Development Community), ECOWAS( Economic Community Of West African States) Forms and opportunities of international business  Reasons for engaging in international business: Profits, Customers, Supplies, Capital, Labour.  Market entry strategies involve the sale of goods or services to foreign markets but do not require expensive investments.  Types of market entry strategies: - Global sourcing - Exporting - Importing - Licensing agreement - Franchising Common forms of international business- from market entry to direct investment strategies Market Entry Strategies: - Global sourcing - Exporting and importing - Licensing and franchising Direct Investment: - Joint ventures - Foreign subsidiaries  Direct investment strategies require major capital commitments but create rights of ownership and control over foreign operations.  Types of direct investment strategies: - Joint ventures - Foreign subsidiaries  Criteria for choosing a joint venture partner: - Familiarity with your firm’s major business. - Strong lock workforce. - Future expansion possibilities. - Strong local market for partner’s own products. - Good profit potential. - Sound financial standing.  Complications in the global business environment: - Environment is complex, dynamic, and highly competitive. - Global business executives must deal with differences in the environment of business in different countries. - World Trade Organization resolves trade and tariff disputes among countries. - Protectionism can complicate global trading relationships. Definition of multinational corporations  A multinational corporation (MNC) is a business with extensive international operations in more than one foreign country.  Mutual benefits for host country and MNC: - Shared growth opportunities - Shared income opportunities - Shared learning opportunities - Shared development opportunities  Complains about MNC by the host countries: - Excessive profits - Domination of local economy - Interference with local government - Hiring the best local talent - Limited technology transfer - Disrespect for local customs  MNC
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