Global Business Management

Assignment-1
GBM
Q. Outline at least 5 key theories/concepts of global business and its

management dealt through cases.
Case 1: -
Bribery and corruption at Siemens
Ethics - It is the system of procedures and processes by which corporates are managed,
directed and controlled. It provides a means through which the organization’s directors and
managers undertake ethical behaviour, corporate social responsibility and sustainability.
With reference to the case - of siemens it was clearly mentioned that they had to hire a
separate ombudsman and supervising teams as remedial actions which will eventually add
on to the cost of company so they try to avoid it as long as they can.
CSR - Corporate social responsibility refers to operating business in a manner that meets or
exceeds, the ethical, legal and commercial expectations of customers and shareholders,
employees and communities where the firm does business.
With reference to case - the customers were also unhappy as a result they delayed ordering
telecommunications equipment from the firm. It also effected their business relationships
with other companies like Nokia corporation has postponed its dealing .
Sustainability - It implies the development and execution of company practices that avoid
harming the ability of future generation to meet their needs.
With reference to case - Due to their corrupt activities they created a negative impact on
their customers but on relationship with other company, they did not follow any social
interest to their working conditions also it became a culture at Siemens to bribe and getting
work done.
Case 2:-
Hyundai Leading the way in global Auto Industry
Competitive advantage - refers to assets and capabilities of a company that are different
from competitors to imitate.
With reference to case - in the case Hyundai has competitive advantage as they have
capabilities like innovation, strategies, and competencies.
Comparative advantage – refers describes superior features of a nation that provide unique
benefits in global competition.
With reference to case - Hyundai has comparative advantage as it was established in south
Korea which is hub of auto industry and had workers bringing innovations in design, features,
production and product quality. This reduces their cost. It is dominated by several
conglomerates called chaebols and this provide Hyundai comparative advantage
Case 3 :-
Global Pharmaceutical Industry
Country risk- It is defined as exposure to potential loss and adverse effects on company ‘s
operations and profitability cost by developments in the country‘s political or legal
environments.
It includes Country risk, Commercial risk ,Financial risk ,Political risk.
With reference to - the pharmaceutical industry invests the most in R&D, creating and
marketing drugs meant to treat everything from cancer to hear loss. Such protection is
often inadequate, especially in developing countries, where pharmaceutical firms in counter
substantial country risk.
Legal Systems - Government grant patents and provide other type of protectors for
intellectual property.
With reference to the case as selling prospects in Brazil, China and other emerging markets
develop over time, pharmaceutical firms increasingly target those markets but face
enormous challenges.
Case 4 :-
China’s going out strategy
Foreign direct investment- in the form of a controlling ownership in a business in one

country by an entity based in another country.
With reference to the case China’s entry into the WTO, continuous increase of outward
foreign direct investment from China into every area of the globe phenomena and that has
been defined as China’s going out strategy.
Political Strategy - There was a clear political strategy of the Chinese government to take
control and sensitive sectors.
With reference to acquisitions by China blocked, in recent years targeting strategic materials
and critical infrastructures. Chinese companies have spent about €5 billion for companies of
the oil and gas, including upstream and exploitation, refineries and projects with a broader
scope.
Case 5: –
Government intervention at Airbus and Boeing
Government Intervention - Government intervention is any action carried out by the

government or public entity that affects the market economy with the direct objective of
having an impact in the economy, beyond the mere regulation of contracts and provision of
public goods.
With reference to Airbus has benefited enormously from government support. The firm has
received tens of billions of euros of subsidies and soft loans from the four founding country
comments and the European union. The government of China is developing its capacity to
produce jumbo jet‘s, part of its quest to challenge Boeing and Airbus in the global aircraft
industry.
Q2. Two key managerial implications for each of these concepts.
Case 1 - Bribery and corruption at Siemens
1. Managers must make ethical behaviour, CSR and sustainability part of company
activities and operation. Business executives should balance their obligations to
shareholders with explicit contribution to the broader public good.
2. focus on providing good jobs, supporting social causes in local communities, and going
beyond legal requirements to minimise pollution and other negative effects of business
Case 2- Hyundai Leading the way in global Auto Industry
1. This facilitates firms’ sales. Helps the company to gain profits from economies of scale.
This values firm’s ownership -specific advantage
2. It can gain advantage from internalizing foreign based manufacturing, distribution, or
other valuable chain activities
Case 3 - Global Pharmaceutical Industry
1. Manager should have knowledge of risk which is a combination of the probability of an

event occurring and its consequences. distinguished between two components of risk,
which they called ‘event risk’ and ‘outcome risk’ and the chance of the occurrence of an
event that, jointly, result in losses.
Case 4 - China’s going out strategy
1. When partners have different goals for the venture, or their goals change over time,
they can find them sells operating at cross purposes. To overcome such challenges
partners need to interact regularly and communicate at three levels of the organisation:
senior management, operational management and the workforce.
2. Collaboration takes place between current or potential competitors that must walk a
fine line between cooperation and competition
Case 5 - Government intervention at Airbus and Boeing
1. Managers develop strategies suited to the region as a whole rather than to individual
countries.
2. As firms increasingly view the block as one large market, they tend to standardise their
products and marketing. They start selling much the same products, using similar
marketing approaches, to all countries inside the bloc.
Submitted By – Varun Bajaj

Section B – PGDM

Global Business Management

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Assignment-1

Q. Outline at least 5 key theories/concepts of global business and its

Foreign direct investment- in the form of a controlling ownership in a business in one

Government Intervention - Government intervention is any action carried out by the

Q2. Two key managerial implications for each of these concepts.

Case 1 - Bribery and corruption at Siemens

Case 2- Hyundai Leading the way in global Auto Industry

Case 3 - Global Pharmaceutical Industry

1. Manager should have knowledge of risk which is a combination of the probability of an

Case 5 - Government intervention at Airbus and Boeing

Submitted By – Varun Bajaj

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