INTERNATIONAL BUSINESS RESEARCH

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INTERNATIONAL BUSINESSRESEARCH
Source Czinkota, M., Ronkainen, I., and Moffett,
M. (1999). International Business. Fort Worth
The Dryden Press.0
The single most important cause for failure in
international business is insufficient
preparation and information
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• I - INTRODUCTION

• The failure of managers to comprehend cultural
  disparities, the failure to remember that
  customers differ from country to country, and the
  lack of investigation into whether or not a
  market exists prior to market entry has made
  international business a risk activity
• Differences between domestic and international
  research
• a) new parameters (duties, foreign currencies,
  international documentation)
• b) new environmental factors (legal issues,
  cultural issues, political issues, technological
  level of the society)
• c) The number of factors involved
• d) Broader definition of competition (much
  greater variety of competition)

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• II - RECOGNIZING THE NEED FOR INTERNATIONAL
  RESEARCH

• Lack of sensitivity to differences in culture,
  consumer tastes, and market demands
• Limited appreciation for the environment (Labour
  rules, distribution systems, the availability of
  media, or advertising regulations)
• Lack of familiarity with national and
  international data sources and inability to use
  international data once obtained

Research allows management to identify and
develop international strategies (identification,
evaluation, and comparison of potential foreign
business opportunities and subsequent
target-market selection)
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Research is necessary for the development of a
business plan that identifies all the
requirements necessary for market entry, market
penetration, and expansion Research provides the
feedback needed to fine-tune various business
activities Research can provide management with
intelligence to help anticipate events, take
appropriate action, and adequately prepare for
global changes.
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III - DETERMINING RESEARCH OBJECTIVES

• Objectives will vary depending on the views of
  management,the corporate mission of the firm, the
  firms level of internationalization, and its
  competitive situation.
• Going International Exporting Cursory of
  general variables of a country, including total
  and per capita GNP, population figures. These
  details will enable the researcher to determine
  whether corporate objectives might be met in the
  market.
• Next Step, the researcher will require
  information on each individual country for a
  preliminary evaluation.

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• Third, selection of appropriate market for
  in-depth evaluation
• Fourth, a competitive assessment needs to be
  made, matching markets to corporate strengths,
  and providing an analysis of the best potential
  for specific offerings

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IV - CONDUCTING SECONDARY RESEARCH
Typically the information requirements will cover
both macro information about countries and trade
as well as micro information specific to the
firms activities Most critical International
Information for U.S. firms

• A) Macro data tariff Information, U.S.
  export/import data, nontariff measures, foreign
  export/import data and data on government trade
  policy
• B) Micro Data Local Laws and Regulations, Size
  of the market, local standards and
  specifications, distribution system, and
  competitive activity.

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c) Sources of Secondary Data US Government
Department of Commerce International Agencies
United Nations-UNCTAD, World Bank, IMF Service
Organizations Banks, Accounting Firms, foreign
Research firms, freight forwarders Trade
Associations American Chamber of
Commerce Directories and Newsletters Databases
on-line interactive delivery, read-only
memory Secondary data should be evaluated
regarding the quality of their source, their
recency, and their relevance to the task at hand.
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V - CONDUCTING PRIMARY RESEARCH

• Typically primary research intends to answer such
  clear-cut questions as
• What is our sales potential, how skilled is the
  labour force, what will happen to demand if we
  raise the price by 10? What effect will a new
  type of packaging have on our sales?
• Determining the Research Technique Selection of
  the research technique depends on a variety of
  factors
• Objectivity of data, unstructured data, data
  collected in real world or controlled
  environment, historical facts or information on
  future developments

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• Interviews
• Surveys must pay attention to cultural
  differences
• Focus Group (Collective Interviews)
• Observation
• Environment Scanning necessity for tracking
  developments in the environment. Environmental
  scanning activities provide continuous
  information on political, social, and economic
  affairs internationally on changes of attitudes
  of public institutions and private citizens and
  on possible upcomings.

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• Typically, environmental scanning is designed
  primarily to aid the strategic-planning process
  rather than the tactical activities of the
  corporation
• Delphi Studies A means for aggregating the
  information of a group of experts. Typically,
  Delphi Studies are carried out with groups of
  about 30 well-chosen participants who possess
  expertise in an area of concern such as future
  developments of the international trade
  environment.