International Business Environment and It’s Changing Nature

Content:

1. What You Should Know About International Business Environment
2. Understanding Success & Failure In International Business Environment
3. International Business Environment and It’s Changing Nature
4. Competitive Factors That Influence International Business Environment
5. Requirement for General Environmental Scanning in International Business
6. Systemizing the Search for Int Business Opportunities
7. Key Factors That Drive The Competitive Environment

Understanding the changing nature of the business environment is the second key step for an international company.

A new international economic order has emerged across the world, with the balance of trade moving towards the Asia Pacific and new markets starting to dominate the thinking of company strategists. Many companies are in a period of major transition and the list is too long to contemplate. The companies affected include household names such as IBM, who have had to adapt to a new business environment which they had difficulty in predicting.

Two of the reasons for this are the threat of increased competition following the deregulation of sectors of the economy and the changing source of the competitive threat, which seems to be increasingly unpredictable. The economic growth policies established by each country are promoting economic growth as a major focus of their manifesto and this places greater pressure on companies to perform. The outcome is that most business environments are becoming sophisticated or are realizing that they need to improve and are introducing policies to ensure success.

International Business Environment 

Advancements in technology are increasingly being utilized by companies, who now have a greater level of choice, and the cost of technology transfer is decreasing in some markets. Increasingly, the technology that is available to companies is supported by a range of suppliers who are searching for new applications.

The growth and influence of pressure groups throughout the world is having a profound affect on the thinking of many senior managers in international companies. There is a clear recognition that actions taken in one market will have a direct affect on the customer base of another market, International companies are recognizing the sophistication of these pressure groups, and their influence can be seen in the retail, manufacturing, food production and energy sectors of the world economy.

Companies are involved in more intra-company trade, sharing company resources, developing partnerships and discovering new ways to enhance cooperation between functions of the company. There has also been an increase in international service companies which have a global reach and innovative management teams that use technology to seek advancement in company performance.

International businesses are increasingly using some form of licensing as part of their corporate strategy, which enables them to cut across segments of the market and enhance manufacturing capability. International businesses have also focused on franchising as a threshold of gaining strategic acceptance of a business concept and utilizing the strengths of independent business people. An additional advantage is that franchising can be accepted by governments as a legitimate method of market entry. The increased use of strategic alliances has been gradual in the 1990s, with a long-term view being adopted by many companies, accompanied by a focus on government support for company alliances within one country.

Patterns of organization and management have also had an impact on the business environment of international businesses. The flexibility of people in terms of their roles and responsibilities within companies has increased and there is an emphasis on new methods of manufacturing. The flexibility of research and development and its link to operational aspects of the business have been recognized as important. The focus on integration of technology, processes and networks is having a profound affect on the way senior management views the business environment.

Decentralization and delegation of responsibility are forming the foundations of corporate strategy in many international businesses. The focus on devolved decision-making is influencing the thinking of senior strategists in many companies and this manifests itself in the design of organizational structure being considered by some international businesses.

All of these changes have repercussions for the employee relations strategies developed by companies, with companies being expected to adopt a proactive and participative style towards employee relations. These issues are also being considered alongside the question of ownership and whether or not a share in the business should be offered to employees in the form of a stake holding in the company. The acceptance and management of change are becoming key drivers in the management of international businesses.

Continue at: Competitive Factors That Influence International Business Environment