BUSI 3103 Chapter Notes - Chapter 6: Global Arena, Geert Hofstede, Assertiveness
25 Jul 2018
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Chapter 6: designing organizations for the international environment. Expanding internationally brings a new set of challenges but companies are doing it anyway for reasons such as: the home market has been outgrown in order to ensure continued growth, new markets must be conquered. Organizations, even large ones, used to be able to get away with ignoring the global market however, with the onset of free trade agreements and technology, globalization changed everything: even small organizations are affected by the international market. Economies of scale: by expanding to the international realm, organizations hope to achieve economies of scale, minimize per unit costs, home markets often not big enough, can lead to volume discounts from suppliers. Economies of scope (breadth: refers to a variety of products/services companies offer, regions in which they operate, by operating in multiple regions, organizations gain exposure to a variety of markets, cultures, etc. Lower wages, looser regulations are also major incentives.
