Learning Outcome 1 The learner will: Understand the international business environment facing global operators.

Transcription

1 Unit Title: International Business Case Study Guided Learning Hours: 210 Level: Level 6 Number of Credits: 25 Learning Outcome 1 The learner will: Understand the international business environment facing global operators. 1.1 Identify and describe the key challenges facing global businesses and organisations The fundamental shift taking place in the world economy and the inexorable move from a world of nation states to a borderless world The independent regional and global economic system with the opportunities created for businesses to extend their reach, expand their revenues, drive down costs and accelerate profitability The trends in the growth of economic and political regional groupings such as the EU, NAFTA, ASEAN, MERCOSUR, ECOWAS, and other trade blocs The changing balance of world trade with the growth of the BRIC nations (China, India, Brazil and Russia) The advantages and benefits conferred by the Information Telecommunication (ITC) revolution sweeping the business and consumer worlds, and the associated changes in logistics, distribution and supply chains The accelerated flows of foreign direct investment (FDI), leading to the dislocation between production and consumption, ending the dependence on national coherence. 1.2 Describe globalisation and international trade and recognise the key drivers Define globalisation and its implications for regions, countries, markets and customers: The pros and cons of globalisation, i.e. prosperity and impoverishment. The key aim of globalisation: combining high cost reduction pressures and high pressure for local responsiveness The two main components: the globalisation of markets (customers), and the globalisation of production to deliver best possible value to all markets served by the organisation The key drivers of globalisation and international trade i.e. ICT developments (internet, mobile phones), multinationals, transnationals, urbanisation, global consumers, together with the prevailing counter culture as typified by the

2 G20 protests, with the use of the internet (social networks) as responses to globalisation The role of international institutions such as the World Trade Organisation (WTO), World Bank, International Monetary Fund (IMF), Organisation for Economic Cooperation and Development (OECD), the G20 and other facilitating/transitional/policy-making bodies and forums. 1.3 Evaluate the impact of emerging issues on international activities The dynamic international environment as evidenced by the global financial crisis of 2008/09 and the issues associated with global warming The increasing impact of microprocessors, telecommunications, transportation technology and the internet on creating paradigm shifts in production, consumption and supply chain relationships The growing role of nation states and regions in monitoring and challenging the pace of change for organisations and consumers The activities and policies of international environmental organisations and NGOs The significance and growing importance of Corporate Social Responsibility (CSR) globally. Learning Outcome 2 The learner will: Know how to develop a strategic business plan for an international organisation. 2.1 Explain the role of strategy in the international context The role of strategy, the issues of strategic choice: defining what is necessary to achieve the corporate objective(s), e.g. to most business organisations the principal goal is to be highly profitable, and that profitability comes from adding value and by lowering costs, i.e. differentiation or low cost strategy (or both) The concept of Strategic Business Units (SBUs) and the value chain in the context of international business The five key strategic decisions: export strategy, international strategy, multi-domestic strategy, global strategy, transnational strategy. 2.2 Identify and analyse The academic and business models used in the

3 strategic outcomes using the relevant academic and business models. development of strategy and their application to the creation and development of the business plan. Notably these include: Porter s Generic Strategies, Ansoff Matrix, Boston Consulting Group Matrix(BCG), General Electric (GE) Matrix, Shell Directional Matrix, Harrell and Keifer (1993) Business Portfolio and Bowman s Strategy Clock The strategic appraisal (audit) of organisations by applying relevant frameworks such as Porter s Five Forces Model, McKinsey s 7Ss, Value Chain, SWOT and Stakeholders Analysis The relevant financial metrics and measures of performance such as Kaplan and Norton s Balanced Scorecard. 2.3 Formulate recommendations embracing domestic as well as international strategies The strategic options and their importance in implementing international operations, from exporting through to strategic alliances The basis for the stronghold position: cost and quality, innovation, financial resources, timing and knowledge Evaluation of the entry strategies options: simple exporting through indirect and direct exporting, leading on to overseas production and the establishment of overseas subsidiaries A critical assessment of the applicability of joint ventures, strategic alliances, mergers and acquisitions. Learning Outcome 3 The learner will: Understand how to evaluate the implementation of a strategic business plan. 3.1 Examine the cross functional issues that affect the implementation of business plans The management structures which are appropriate to the four strategic options (international, multi-domestic, global and transnational) The structural issues that underpin the effective implementation within the four basic management approaches (ethnocentric, polycentric, region-centric, geocentric) Key HR issues involved with dealing with expatriate managers, such as the training and development of local managers, performance appraisal, and corporate acculturation International labour relations and the differing employment laws and cultures.

4 3.2 Explain how international business plans are monitored, measured and controlled The attitudes towards the concepts of control and control systems on a regional level The identification of Critical Success Factors/Key Performance Indicators The use of techniques such as Benchmarking. 3.3 Explain the role of financial management in international business International investment decisions, global financial markets, political and economic risk, transactional taxation and transfer pricing The different accounting standards globally The key financial indicators of performance. Learning Outcome 4 The learner will: Know how to evaluate and recommend organisational structures for international operations. 4.1 Assess how cultural values play a major role in shaping customs and practice in the organisation The body of knowledge on cultural diversity and its effect on organisational practices and customers, notably Terpstra and Sarathy s model of the determinants of culture, and Hofstede s framework The relationship between cultures, the costs of doing business in a country, and the understanding that a culture is underpinned by a set of values and norms that should be explained together with the relationship between society and the nation state The extent of the need for cultural adaptation and the level of cultural consistency across borders and regions. 4.2 Identify and describe the various methods and approaches to international organisational structures and make recommendations relevant to the needs of the organisation and the environment The various approaches to international organisational structures The role of organisational culture in implementation of the structure The impact on key relationships both internally and externally.

5 4.3 Describe and explain the linkages between corporate headquarters and the regional and local subsidiaries The role played by corporate HQ in establishing corporate objectives and strategies plus the development of the corporate business plan over the longer period The impediments to co-ordination with an understanding that formal and informal mechanisms need to be established. Learning Outcome 5 The learner will: Understand the importance of leadership, strategic direction and change management within the international business context. 5.1 Explain the issues underpinning motivational change and the creation of readiness for this change The important role of change management for developing international business The basic theories of change: Lewin s change model of unfreezing, change and refreezing; the action research model and its contemporary adaptations The different types of planned change depending on the magnitude of the change and the degree of organisational involvement The drivers for change such as the re-defining of traditional boundaries between industries/markets/product categories e.g. mobile phones are now cameras, computers. 5.2 Evaluate the strategic role of leadership in developing successful international operations The need for leadership in developing internationally, the creation of a vision and the communication of this to diverse audiences The importance of team building as a change agent internationally and its contribution to sustaining momentum in the implementation of the vision. 5.3 Explain the role played by planning in the shaping of the future direction for the organisation The planning cycle and implementation issues The merits and pitfalls of top down versus bottom up planning theory The methods used to forecast the future such as scenario planning, expert opinion and the Delphi technique.

6 Learning Outcome 6 The learner will: Understand the macro environmental factors that affect the international organisation. 6.1 Evaluate the impacts of the different political and legal systems that organisations operate within The impact of different political systems on international operations, from collectivism, individualism and democracy to authoritarianism The influence of different political systems in the shaping of the economic and legal frameworks with which the global operator must comply, with knowledge of their origins Key elements of different legal systems in terms of protection of employment, property rights, intellectual capital, product safety, product liability and other relevant areas of the law/regulation depending on the specific situation. 6.2 Explain how countries are at different stages of economic development and how international business solutions will reflect these stages The measurement of economic development and the categorisation of countries and regions accordingly The diversity of economic development and the structural difficulties within political and customs unions with the even greater differences between unaffiliated countries. 6.3 Evaluate the growing importance of corporate social responsibility (CSR) The growing role and significance of corporate social/ethical responsibility and the impact of consumer movements The role of stakeholders from governments through to individual customers in terms of trust, values, attitude to the environment, human rights and dignity, transparency and accountability and governance The impact on CSR caused by global communications driven by the growing penetration of the internet leading to immediate flows of information around the world. Assessment: Assessment method: written examination (unless otherwise stated). Written examinations are of three hours duration. All learning outcomes will be assessed. Recommended Reading: International Business Case Study ABE Study Manual. Please refer to the Tuition Resources section of the Members Area of the ABE website ( for further recommended reading.