International businesses must be organized so that they can adapt to cultural and environmental differences. No longer can organizations just put “carbon copies” or clones of themselves in foreign countries.
Global competition has forced businesses to change how they manage at home and abroad. The increasing rate of change, technological advances, shorter product life cycles , and high‐speed communications are all factors that contribute to these changes. The new management approach focuses on establishing a new communication system that features a high level of employee involvement. Organizational structures must also be flexible enough to change with changing market conditions. Ongoing staff development programs and design‐control procedures, which are understandable and acceptable, are outcomes from this new approach. Management values are changing, and managers must now have a vision and be able to communicate the vision to everyone in the firm.
The first stage of international planning is to decide how to do business globally: whether to export, to enter into licensing agreements or joint ventures, or to operate as a multinational corporation with facilities in a foreign country.
As foreign operations become more important to the bottom line, decision making becomes more centralized at corporate headquarters. A functional product group, geographic approach, or a combination of these approaches should be adopted. The firm unifies international activities with worldwide decisions at world headquarters.
International firms should be sure that their plans fit the culture of the host country. Typically, U.S. firms feel that long‐term plans should be three to five years in length; but in some cultures, this time period is too short. Many countries must plan with the assistance of governmental agencies.
Pre‐international stage. Companies with a product or service that incorporates the latest technology, is unique, or is superior may consider themselves ready for the international arena. The first strategy used to introduce a product to a foreign market is to find a way to export the product. At this phase, the firm adds an export manager as part of the marketing department and finds foreign partners.
Geographic dispersion and distance, language barriers, and legal restrictions complicate the controlling function. Meetings, reporting, and inspections are typically part of the international control system.
Legal considerations The legal aspects are important for the business choice. Laws are different in every country. Laws would regulate business practice‚ define the manner and set down the rights and obligations. This made business have to run within the border set by law and definitely affects the efficiency and profitability when running business in that country. The type of legal system . The legal system in Spain and Korea is based on civil law‚ while court precedents are not granted official
contract ? It is important to choose an applicable law in the contract in order to avoid the conflict of laws between countries. That’s why is necessary to set a procedure of rules that determines which legal system and which jurisdiction apply to a given dispute. The rules typically apply when a legal dispute has a "foreign" element such as a contract agreed to by parties located in different countries‚ although the "foreign" element also exists in multi-jurisdictional countries. The basics principles
International business is large activity that related with private transaction‚ governmental‚ business that begins from two or more countries. The competition affects all of firms which large or small is more complicate and diversity more than domestic. Globalization is integration nearly of peoples and countries that has been reduced problems and breaking down of barrier to the flow of services‚ goods‚ capital‚ knowledge‚ etc. The globalization on the international business is a diversity of business
Laws Related to Ethics in Business Foreign Corrupt Practices Act of 1977 - requires U.S. companies to account for and report international transactions accurately and prohibits bribes (including gifts and entertainment) that are used to gain a business advantage. Intercultural Business Communication, 4th ed., Chaney & Martin.
Employment Laws Most nations have legislation governing wages, hours, union- management relations, residence visas, and work permits. Some nations require a certain ratio of nationals to foreigners. Legal questions that may be asked of a potential employee differ by country.