INTERNATIONAL BUSINESS
International business comprises all commercial
transactions (private and governmental,
sales,
investments,
logistics,
and transportation)
that take place between two or more regions,
countries
and nations
beyond their political boundaries. Usually, private companies undertake such transactions for profit; governments
undertake them for profit and for political
reasons.[1]
It refers to all those business activities which involve cross border
transactions of goods, services, resources between two or more nations.
Transaction of economic resources include capital, skills, people etc. for
international production of physical goods and services such as finance,
banking, insurance, construction etc.[2]
A multinational enterprise (MNE) is a
company that has a worldwide approach to markets and production or one with
operations in more than a country. An MNE is often called multinational
corporation (MNC) or transnational company (TNC). Well known MNCs include fast food
companies such as McDonald's and Yum Brands,
vehicle manufacturers such as General Motors, Ford Motor Company and Toyota,
consumer electronics companies like Samsung,
LG and Sony, and energy companies
such as ExxonMobil,
Shell and BP. Most of the largest
corporations operate in multiple national markets.
Areas of study within this topic
include differences in legal systems, political
systems, economic policy, language,
accounting
standards, labor standards, living
standards, environmental standards, local culture,
corporate culture, foreign exchange market, tariffs, import and export
regulations, trade agreements, climate,
education
and many more topics. Each of these factors requires significant changes in how
individual business units operate from one country to the next.
Physical and societal factors of
competitive Business social environment
The conduct of international
operations depends on companies' objectives and the means with which they carry
them out. The operations affect and are affected by the physical and societal
factors and the competitive environment.
Operations of business
- Objectives: sales expansion, resource acquisition, risk minimization, Diversify their revenue stream
Means of businesses
- Modes: importing and exporting, tourism and transportation, licensing and franchising, turnkey operations, management contracts, direct investment and portfolio investments.
- Functions: marketing, global manufacturing and supply chain management, accounting, finance, human resources
- Overlaying alternatives: choice of countries, organization and control mechanisms
Physical and societal factors of business
- Political policies and legal practices
- Cultural factors
- Economic forces
- Geographical influences
Competitive factors of business
- Major advantage in price, marketing, innovation or other factors.
- Number and comparative capabilities of competitors
- Competitive differences by country
- Local taxes
Risk of business
- Strategic risk
- Operational risk
- Political risk
- Technological Risk
- Environmental Risk
- Economic Risk
- Financial risk
- Terrorism Risk
- Planing risk
- Being a beauty risk
Factors that influenced the growth
in globalization of international business
There has been growth in globalization
in recent decades due to (at least) the following eight factors:
- Technology is expanding, especially in transportation and communications.
- Governments are removing international business restrictions.
- Institutions provide services to ease the conduct of international business.
- Consumers know about and want foreign goods and services.
- Competition has become more global.
- Political relationships have improved among some major economic powers.
- Countries cooperate more on transnational issues.
- Cross-national cooperation and agreements.
Importance of International Business
Education
- Most companies are either international or compete with international companies.
- Modes of operation may differ from those used domestically.
- The best way of conducting business may differ by country.
- An understanding helps you make better career decisions.
- An understanding helps you decide what governmental policies to support.
Managers in international business must understand social
science disciplines and how they affect all functional business fields.
Importance of studying International
Business
The International Business standards focuses on the
following:
- raising awareness of the interrelatedness of one country's political policies and economic practices on another;
- learning to improve international business relations through appropriate communication strategies;
- understanding the global business environment—that is, the interconnected-ness of cultural, political, legal, economic, and ethical systems;
- exploring basic concepts underlying international finance, management, marketing, and trade relations; and
- identifying forms of business ownership and international business opportunities.
By focusing on these, students will
gain a better understanding of Political
economy. These are tools that would help future business people
bridge the economical and political gap between countries.
There is an increasing amount of
demand for business people with an education in International Business. A
survey conducted by Thomas Patrick from University of Notre Dame concluded that Bachelor's degree holders and Master's
degree holders felt that the training received through education
were very practical in the working environment. Business people with an
education in International Business also had a significantly higher chance of
being sent abroad to work under the international operations of a firm.
Masters
|
Doctorate
|
|
Who is this degree for
|
People interested in management careers with multinational
companies
|
People who are interested in academic or research careers
|
Common Career Paths (with approximate median annual
salary)
|
- Chief executives ($167,000)*
- General or operations managers ($95,000)*
|
- University business professors ($75,000)*
- Economists ($91,000)*
|
Time to Completion
|
1–2 years full-time
|
3–5 years in addition to master's or other foundational
coursework
|
Common Graduation Requirements
|
- Roughly 15-20 graduate level courses
- Internship or study abroad program
- Foreign language requirement
|
Most (or all) of the master's degree requirements, plus:
- At least 12 more graduate level courses
- Ph.D. qualifier exams
- Dissertation prospectus (proposal)
- Dissertation
- Teaching requirement
|
Prerequisites
|
Bachelor's degree and work experience, quantitative
expertise
|
Bachelor's or master's degree in business or related field
|
Online Availability
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Yes
|
Limited
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