International Management Considerations

From: Kenya Nichols Date: 1/2/2015 As the global marketplace continues to develop, companies engage in international business for many reasons. The main reason is to gain value for their organizations which, is the primary motive. In addition, expanding sales, acquiring resources and minimizing risk are also some important factors that are taken into consideration. The pursuit of international sales usually increases the potential market and potential profits. However, acquiring resources requires that the producers and distributors track down products, services, resources and other components from foreign companies. To gain a competitive edge companies often promote resources that cut cost. The prospect of gaining a competitive advantage can be improved by improving the quality of the product or by differentiating your products from those of competitors. One significant reason the global market makes sense is it is techchnological because of improved transportation and communication opportunities today, trade is now more practical. As a result, consumers and businesses now have access to the best products from many different countries. On the other hand, regrettably, culture is ambiguous concern for many marketers since it is inherently obscure and often strenuous to perceive. One may breach the cultural patterns of another country without being in the know. Foreign sources propositions companies with lower costs new or better products and additional operating knowledge. In essential, minimizing risk involving sales and profits is the key when negotiating different business cycles in foreign operating companies. The culminating facts are that sales decrease or grow more slowly in a country that’s in a recession and increase or grow more rapidly in one that’s sound economically. Merchandising exports and imports are some of the most notable modes if international business amongst small companies, which is also the companies most international economic transactions. Presently, services exports and imports take many forms, and is the fastest growth sector in international trade. Service exports and imports are international non-product sales and purchases. The most important are tourism and transportation, service performance and asset use. There are variances of operating modes that companies can employ in international business operations. Some of the modes of operation include exporting and importing merchandise and services, direct and portfolio investments, and collaborative arrangements with other companies. Furthermore, managers that operate within a company’s external environment must possess not only knowledge of business operations ,but also be enlightened about some of the basic social sciences. Therefore, managers within a corporation should be acknowledged as trustees and guardians of the investments made by the shareholders. In addition, the managers have a corporate social responsibility as well as responses to stakeholders. To be acquainted, it was suggested, that managers have been categorized into three types of moral values: immoral, amoral, and moral. Usually, managers carried out varied management styles with the stakeholders. Noteworthy enough, there are certain social responsibilities that come into play in the decision making of managers. Social responsibility can be examined by identifying these major components economic, legal, ethical and discretionary responsibilities. To meet these obligations, communication with external and internal stakeholders ,is vital to the organizations survival. Conflict within companies and within international organizations is one of the main problems in International Business. Also, the difference of opinion in strategies between different management levels in international business also poses a problem. Therefore, if support is inadequate the international business proposal fails. Richard Welford, identified four overall areas that can be used in assessing corporate policies for corporate social responsibility and they are as follows: internal aspects, external aspects, accountability, and citizenship. Integrating corporate responsibility into the company’s strategy can be a challenge for many companies that have never considered the benefits and effects of being a responsible citizen. “Global manufacturing and supply-chain management are important in companies’ international business strategies.” (Edition 569) There are some major issues related to supply chain management that should be mentioned. Some specific issues that have materialized included effective global manufacturing strategy, the role of information technology in global supply-chain management, quality, supplier networks, and inventory management, including the importance of effective transportation networks. “The success of a global manufacturing strategy depends on four key factors: compatibility, configuration, coordination, and control”. (Edition 571) Activities such as coordination and control include everything along the global supply chain from purchasing to warehousing to shipment. When a strong commitment to information technology is in order, the supply chain strategy is most effective. Companies that pursue international sales and marketing also go after global sourcing for the self same reasons. “As noted, quality and safety are other concerns with global sourcing.” (Edition 584) Unfortunately, as a result of the countries producing cheap products they also lack adequate regulations, enforcement, and logistical infrastructure, thus leaving it up to the purchasing companies to ensure quality and safety. References Javalgi, R. G., Granot, E., & Brashear Alejandro, T. G. (2011). Qualitative Methods in International Sales Research: Cross-Cultural Considerations. Journal Of Personal Selling & Sales Management, 31(2), 157-170. Edition, Custom. SKS 5000-Business Strategies for Organizational Effectiveness within the Global Perspective VitalSource eBook for Northcentral University. Pearson Learning Solutions. VitalBook file. Conceptual and Normative Aspects of International Management Endel J. Kolde and Richard E. Hill The Academy of Management Journal Vol.10, No. 2 (Jun., 1967), pp. 1190128 Published by: Academy of Management Article Stable URL:http://www.jstor.org/stable/254631