Chapter 1
Chapter 1
1. The differences among multidomestic, global, and international companies are as follow: The multidomestic is an organization with multicountry affiliates. It formulates its own business strategy based on perceived market differences. It adapts to the local market in the country they are in. However, a global company is an organization that attempts to standardize and integrate operations worldwide in most or all functional areas. The advantage it has is cost savings. On the other hand, an international company is either a global or multidomestic company. It achieves economies of scale through global integration and be responsive to different markets.
2. Managers might be unable to successfully apply the techniques and concepts they have learned in their own country, because decision making is more complex and self-reference criterion. Those who work in the international environment find that decision making is more complex than it is in a purely domestic environment. Second, the common cause of added complexity of foreign environments is managers’ unfamiliarity with other cultures. Self-reference criterion is the biggest cause of international business blunders.
4. Although, forces in the foreign environment are the same as those in the domestic environment they operate differently for several reasons. The forces have different values and at times they are completely opposed to each other. Second problem with foreign forces is that they are frequently difficult to assess, especially with legal and political forces. The forces are also interrelated.
5. In a foreign environment all the uncontrollable forces originating outside the home country that surround and influence the firm. It has political values and it has difficulty assessing forces. On the other hand, international environment consists of the interactions between the domestic environmental forces and the foreign environmental forces. It also interacts between the foreign environmental
1. The differences among multidomestic, global, and international companies are as follow: The multidomestic is an organization with multicountry affiliates. It formulates its own business strategy based on perceived market differences. It adapts to the local market in the country they are in. However, a global company is an organization that attempts to standardize and integrate operations worldwide in most or all functional areas. The advantage it has is cost savings. On the other hand, an international company is either a global or multidomestic company. It achieves economies of scale through global integration and be responsive to different markets.
2. Managers might be unable to successfully apply the techniques and concepts they have learned in their own country, because decision making is more complex and self-reference criterion. Those who work in the international environment find that decision making is more complex than it is in a purely domestic environment. Second, the common cause of added complexity of foreign environments is managers’ unfamiliarity with other cultures. Self-reference criterion is the biggest cause of international business blunders.
4. Although, forces in the foreign environment are the same as those in the domestic environment they operate differently for several reasons. The forces have different values and at times they are completely opposed to each other. Second problem with foreign forces is that they are frequently difficult to assess, especially with legal and political forces. The forces are also interrelated.
5. In a foreign environment all the uncontrollable forces originating outside the home country that surround and influence the firm. It has political values and it has difficulty assessing forces. On the other hand, international environment consists of the interactions between the domestic environmental forces and the foreign environmental forces. It also interacts between the foreign environmental