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Critical evaluation of the international business environment

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  1. Abstract
  2. Introduction
  3. Discussion
  4. Competitive challenges
  5. Financial challenges
  6. Economic challenges
  7. Political challenges
  8. Labor regulations
  9. Conclusion
  10. References

The more closely the management of an international company can align its comparative advantage with a source or destination country's competitive advantage, the more conveniently it can achieve and maintain its overall business objectives. Management of international business demands consistent reference to controllable environmental factors such as raw materials, capital and people, marketing, advertising, personnel management and finance as well as uncontrollable environmental factors that include competition, distribution, the economy, finance, regulations, geography, politics, culture, labor and technology.

The management of international organizations is definitely different from the management of domestic organizations because ?organizations conducting business across borders must deal with the complexities of three different types of environment namely domestic environment, foreign environment and international environment? Batt.

[...] Such occurrences are inevitable in the international business environment and they cause instability in real interest rates and capital inflows from abroad, effectively increasing the real exchange rates (Kenen, 1996). The appreciation of interest rates will subsequently be coupled with increase in external debts, a situation that will dissuade investors abroad from holding more debts (Kenen, 1996). Such outcomes lead to the interest rate cycle taking a different direction that reduces real exchange rates as a result of declined capital inflows (Kenen, 1996). [...]

[...] Such reference to workers' behavioral aspects has further been recommended by theory Y which poses optimistic view of workers as hard working, sensitive and cooperative (Cole, 2004). W.G Ouchi's theory Z which is based on studies of success of Japanese companies in manufacturing also lends credence to human aspect of management by suggesting the ?coordination of people rather than technology in the pursuit of productivity? (Cole p. 29). Some of the motivational strategies which can be adopted by managers in international business environment include delegation, employee empowerment, and assertiveness. [...]

[...] Economic Challenges For any pursuit in international management to be successful, due recognition must always be accorded to the fact that the goal of international business operations is to increase the value of the firm (Kenen, 1996). Exports for exports sake or any other arbitrary objectives cannot achieve much value for the company. The essence of international business is best captured by Kenen (1996) who stated that exports in general and of a specific product are a good? in and of themselves while import in general and of a specific produce are (p. [...]

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