New Horizons

1
Chapter 20

• New Horizons

2
Learning Objectives

• Understand the many changing dimensions
  that shape international business.
• Learn about and evaluate the international
  business forecasts made by a panel of experts.
• Be informed about different career opportunities
  in international business.

3
New Horizons

• The International Business Environment
• Globalization and Trade Negotiations
• Government Policy
• The Future of International Business Management
• Careers in International Business

4
The International Business Environment

• Conditions of Change in
• Politics
• Finance
• Society
• Technology

5
The Political Environment

• Transformations
• Reshaping of
• existing political
• blocks.
• Formation of new
• groupings.
• Breakup of old
• coalitions.

6
Planned Versus Market Economies

• Eastern and Central Europe will continue to be
  attractive for international investment.
• The distinction between developed and
  less-developed countries is unlikely to change.
• Environmental protection will be a major force in
  economic growth.
• Much of the growth of the global economy will be
  fueled by the emerging markets of the Asia
  Pacific region.

7
A Divergence of Values

• Nations hold differing values and priorities.
• Divergence of values will require readjustment of
  activities of the international corporation.

8
International Finance

• Debt constraints and low commodity prices impose
  slow growth prospects for developing countries.
• Developed nations have an incentive to help
  debtor nations.
• The United States is the largest debtor nation in
  the world.

9
Effects of Population Shifts

• Population increase will become a national
  priority in the industrialized world.
• Population stabilization continues to be the
  challenge in the developing world.

10
Technological Environment

• Internet is democratizing global business.
• Small/medium-sized enterprises can now be full
  participants in the global marketplace.
• High technology is a controversial area of
  economic activity.

11
Globalization and Trade Negotiations

• Globalization will continue and trade
  negotiations will continue to experience
  difficulties.

12
Globalization and Trade Negotiations

• Long-term differentiation of countries and firms
  includes

Those Who Grow
Those Who Create
Those Who Make
Those Who Coordinate
13
Government Policy

• International trade activity now affects domestic
  policy more than ever.
• Governments will need to coordinate policies that
  affect the international business environment.
• Policymakers need a better understanding of the
  nature of international trade issues.

14
The Future of International Business Management

• Global change results in an increase in risk.
• International markets remain a source of high
  profits.
• International executives will need to balance the
  public and the private good.

15
International Product Policy

• Environmental concern is a key issue affecting
  product planning.
• Firms will have to plan for the post-mortem
  stage in the product life cycle.
• Product life cycle will be measured in months or
  even weeks.
• Companies will have to deliver more mass
  customization.
• An increase will occur in the trend toward
  strategic alliance.

16
International Communications

• Advances made in international communications
  will have a profound impact on international
  management. Most affected will be members of the
  services sector.

17
Distribution Strategies

• Innovation will determine new ways of serving
  markets.
• More sophisticated distribution systems will also
  introduce new uncertainties such as risk due to
  distribution interruptions.

18
International Pricing

• Will become increasingly heated.
• Forward pricing will become increasingly
  difficult.
• Price competition will be substantial.
• Exchange rate movements may play a more
  significant role in maintaining competitiveness.
• Nations will attempt to stimulate their
  international competitiveness through
  subsidization, targeting, or government contracts.

19
Careers in International Business-- To Prepare

• Be well versed in a specific functional business
  area.
• Take summer internships abroad.
• Take language courses.
• Obtain further in-depth training by enrolling in
  International Business Courses!

20
Opportunities for Women in Global Management

• In the mid-1980s women held 3.3 of overseas
  positions in U.S. firms.
• By 2000, 13 of expatriates were women.
• Expatriates are not seen as women, but rather as
  foreigners who happen to be women.
• Advantages are added visibility and increased
  access to clients.

21
Employment With A Large Firm

• Employees are expected to be grounded in the
  practice and management of business.
• Managers are sent abroad because the company
  expects him or her to reflect corporate spirit.
• Employees returning from the international route
  may find few positions available back at
  headquarters.

22
Employment With A Small Firm

• May have recently developed an international
  outlook.
• With a more limited budget, most of the work may
  be done by mail, fax, e-mail, or by telephone.
• International work may involve importing.
• Small firms provide excellent training ground for
  international activities.

23
Self-EmploymentThe Opportunity to Become a True
International Entrepreneur

• Specialized services that might be offered by a
  consultant include international market
  research, international strategic planning,
  beginning-to-end assistance for international
  entry or international negotiations. There may be
  a higher degree of risk involved, but there is
  also an opportunity for higher rewards.