INTERNATIONAL

BUSINESS
Prepared by;
JEAN B. DENADO, MBM
College of Business, SPCF
LEARNING OBJECTIVES

1. What is international business?

2. Who is interested in international
business?
3. What forms do international
business take?
4. The Globalization debate
5. Ethics and International Business
GLOBALIZATION
—the shift toward a more interdependent
and integrated global economy—creates
greater opportunities for international
business.

- Such globalization can take place in terms

of markets, where trade barriers are falling
and buyer preferences are changing.

- It can also be seen in terms of production,

where a company can source goods and
services easily from other countries.
INTERNATIONAL
BUSINESS
- Encompasses a full range of cross-border exchanges
of goods, services, or resources between two or more
nations.

- These exchanges can go beyond the exchange of

money for physical goods to include international
transfers of other resources, such as people,
intellectual property (e.g.,patents, copyrights, brand
trademarks, and data), and contractual assets or
liabilities (e.g., the right to use some foreign asset,
provide some future service to foreign customers, or
execute a complex financial instrument).
STRATEGIC

BUY 2 GET 1 FREE

MANAGEMENT
is the body of knowledge that
answers questions about the
development and implementation
of good strategies and is mainly
concerned with the determinants of
firm performance
50%
OFF
STRATEGY
Is the central, integrated, and externally
oriented concept of how an organization
will achieve its performance objectives.

SWOT ANALYSIS
The SWOT tool helps you takestock of an
organization’s internal characteristics—its
strengths and weaknesses—to formulate
anaction plan that builds on what it does
well while overcoming or working around
weaknesses.
ENTREPRENEURSHIP
Is defined as the recognition of opportunities (i.e.,
needs, wants, problems, and challenges) and the
use or creation of resources to implement
innovative ideas for new, thoughtfully planned
ventures.

ENTREPRENEUR
An entrepreneur is a person who engages in
entrepreneurship.
INTRAPRENEURSHIP
Is a form if entrepreneurship that takes
place inside a business that already in
existence.

INTRAPRENEUR
Is a person within the established business who
takes direct responsibility for turning an idea into
profitable business product through assertive risk
taking and innovation.
STAKEHOLDER
- is an individual or organization whose
interests may be affected as the result of
what another individual or organization does.

STAKEHOLDER
ANALYSIS
- is a technique you use to identify and
assess the importance of key people,
groups of people, or institutions that may
significantly influence the success of your
activity, project, or business
- Individuals or organizations will have an interest in
international business if it affects them in some way
—positively or negatively.

- Beyond the company and governments, other

stakeholder groups might include industry
associations,trade groups, suppliers, and labor
 THE FORMS OF
INTERNATIONAL BUSINESS
A business can be a person or organization engaged in
commerce with the aim of achieving a profit.

Business profit is typically gauged in financial and economic

terms. However, some level of sustained financial and
economic profits are needed for a business to achieve other
sustainable outcomesmeasured as social or environmental
performance
IMPORTER
sells products and services that are
sourced from other countries

EXPORTER
sells products and services in foreign countries
that are sourced from its home country.
FOREIGN DIRECT INVESTMENT
Foreign direct investment means that a firm
is investing assets directly into a foreign
country’s buildings, equipment, or
organizations

LOCATION ADVANTAGES
Location advantages include better access to raw
materials, less costly labor, key suppliers, key
customers, energy, and natural resources
INTERNATIONAL FORMS OF
GOVERNMENT
- Among political scientists, government is generally
considered to be the body of people that sets and
administers public policy and exercises executive,
political, and sovereign power through customs,
institutions, and laws within a state, country, or other
political unit.

- Or more simply, government is the organization, or

agency, through which a political unit exercises its
authority, controls and administers public policy, and
directs and controls the actions of its members or
subjects.
NONGOVERNMENTAL
ORGANIZATIONS
National nongovernmental organizations (NGOs)
include any nonprofit, voluntary citizens’ groups that are
organized on a local, national, or international level.

-During the twentieth century, globalization actually fostered

the development of NGOs because many problems couldn’t
be solved within a single nation. In addition, international
treaties and organizations, such as the WTO, were perceived
by human rights activists as being too centered on the
interests of business.
THE GLOBALIZATION DEBATE
It is a stark difference of opinion on how the internationalization of businesses
is affecting countries’ cultural, consumer, and national identities—and whether
these changes are desirable.
For instance, the ubiquity of such food purveyors as Coca-Cola and
McDonald’s in practically every country reflects the fact that some consumer
tastes are converging, though at the likely expense of local beverages and
foods.
Remember, globalization refers to the shift toward a more interdependent and
integrated global economy. This shift is fueled largely by (1) declining trade
and investment barriers and (2) new technologies, such as the Internet.
The globalization debate surrounds whether and how fast markets are actually
merging together.
THE WORLD IS FLAT
The flat-world view is largely credited to Thomas Friedman and his 2005 best
seller, The World Is Flat.
An alternative way of thinking about the world (a multidomestic view)

STAGES OF GLOBAL DEVELOPMENT

“Globalization 1.0,” started with Columbus’s discovery of the New World and ran from
1492 to about 1800. Driven by nationalism and religion, this lengthy stage was
characterized by how much industrial power countries could produce and apply.
“Globalization 2.0,” from about 1800 to 2000, was disrupted by the Great Depression
and both World Wars and was largely shaped by the emerging power of huge,
multinational corporations.
“Globalization 3.0” began around 2000, with advances in global electronic
interconnectivity that allowed individuals to communicate as never before.
HOW THE WORLD GOT FLAT
1. November 9, 1989 - When the walls came down and windows went up.
2. August 9, 1995 - When Netscape went public.
3. Work-flow software: Let's do lunch. Have your application talk to my
application.
4. Open-sourcing: Self-organizing, collaborative communities.
5. Outsourcing: Y2K
6. Offshoring: Running with gazelles, eating with lions.
7. Supply-chaining: Eating sushi in Arkansas.
8. Insourcing: What the guys in funny brown shorts are really doing.
9. Informing: Google, Yahoo!, MSN Web Search.
10. The steroids: Digital, mobile, personal, and virtual.
Friedman writes the convergence of three powerful forces:
(1) new software and increased public familiarity with the
Internet,
(2) the incorporation of that knowledge into business and
personal communication, and
(3) the market influx of billions of people from Asia and the
former Soviet Union who want to become more prosperous—
fast.
 CAGE
FRAMEWORK
1. Culture - Culture refers to a people’s norms, common beliefs, and practices. Cultural
distance refers to differences based in language, norms, national or ethnic identity,
levels of trust, tolerance, respect for entrepreneurship and social networks, or other
country-specific qualities.
2. Administration - Conversely, the greater the administrative differences between
nations, the more difficult the trading relationship—whether at the national or
corporate level. It can also refer simply to the level and nature of government
involvement in one industry versus another.
3. Geography - Generally, as distance goes up, trade goes down, since distance
usually increases the cost of transportation. Geographic differences also include
time zones, access to ocean ports, shared borders, topography, and climate
4. Economics - Economic distance refers to differences in demographic and socio
economic conditions. The most obvious economic difference between countries is
size (as compared bygross domestic product, or GDP).
ETHICS
The field of ethics is a branch of philosophy
that seeks virtue.

Ethics deals with morality about what is

considered “right” and “wrong” behavior for
people in various situations.

Today, those who are interested in

international business ethics and ethical
behavior examine various kinds of business
activities and ask, “Is the business conduct
ethically right or wrong?”
A FRAMEWORK FOR
THINKING ETHICALLY
1. Is it an ethical issue?
2. Get the facts.
3. Evaluate alternative actions.
a. Utilitarian approach
b. Rights-based approach
c. Fairness or justice approach
d. Common good approach
e. Virtue approach
4. Test your decision.
5. Just do it- but what did you learn?
WHAT ETHICS IS NOT
1. Ethics is not the same as feelings.
2. Ethics is not religion.
3. Ethics is not following the law.
4. Ethics is not following culturally accepted
norms.
5. Ethics is not science.
THANK
YOU!!!