The Organization of International Business

In: Business and Management

Submitted By uowaustudent
Words 18038
Pages 73
Chapter 15
The Organization of International Business
Laws control the lesser man. Right conduct controls the greater one. – Chinese proverb

Opening Photo

Objectives
• Profile the evolving process of organizing a company for international business
• Describe the features of classical structures
• Describe the features of neoclassical structures
• Discuss the systems used to coordinate and control international activities
• Profile the role and characteristics of organizational culture

CASE: Building an Organization at Johnson & Johnson
The typical pharmaceutical company relies on global integration, given its steep product development costs and potential scale economies. Meanwhile, it must respond to local market conditions, obtaining government approval for each product in each country and establishing local sales and distribution systems. Consequently, headquarters and subsidiaries jointly implement the company’s strategy. Building an organization that can meet this mission is tough. One standout that does is Johnson & Johnson (J&J).
Since the start of its U.S. operations in 1886, J&J has evolved into the most broadly based health-care company in the world. International activity began in 1919 with J&J Canada. Headquartered in New Brunswick, New Jersey, J&J lists 250 operating companies across the world, holds more than 54,000 U.S. and foreign patents, sells products in more than 175 countries, and employs about 115,000 people worldwide, with nearly 70,000 working in 57 countries outside the United States. Its steady success is renowned. Sales in 2010 were $61.6 billion and it increased its dividend for the 49th consecutive year. J&J is generally regarded as the most admired pharmaceutical company in the world. The quality of J&J's portfolio of anti-infective, cardiovascular, dermatology, immunology, and oncology products is…...

Similar Documents

International Business

...more integrated and interdependent world economy. TRUE AACSB: Analytic BT: Knowledge Difficulty: Easy Learning Objective: 1-1 Topic: What Is Globalization? 2. (p. 7) Tastes and preferences of consumers in different nations are beginning to converge on some global norm. TRUE AACSB: Analytic BT: Knowledge Difficulty: Easy Learning Objective: 1-1 Topic: What Is Globalization? 3. (p. 7) A company has to be a major multinational corporation to facilitate, and benefit from, the globalization of markets. FALSE AACSB: Analytic BT: Knowledge Difficulty: Medium Learning Objective: 1-1 Topic: What Is Globalization? 4. (p. 7) In Germany, 98 percent of small and midsize companies have exposure to international markets. TRUE AACSB: Analytic BT: Knowledge Difficulty: Easy Learning Objective: 1-1 Topic: What Is Globalization? 5. (p. 8) Currently, the most global of markets are for industrial goods and materials that serve a universal need the world over. TRUE AACSB: Analytic BT: Knowledge Difficulty: Easy Learning Objective: 1-1 Topic: What Is Globalization? 6. (p. 8) As firms follow each other around the world, greater diversity replaces uniformity. FALSE AACSB: Analytic BT: Knowledge Difficulty: Easy Learning Objective: 1-1 Topic: What Is Globalization? 7. (p. 10) Substantial impediments such as barriers to foreign direct investment make it difficult for firms to achieve the optimal dispersion...

Words: 7962 - Pages: 32

Business Organization

...The twenty-first century is a period of unprecedented change in organizations. The popular Business press constantly documents organizational restructuring, reengineering, downsizing, and other assorted changes. Even during the robust economy of the late 1990s, many large Companies were shedding jobs at an incredible pace. Terms such as downsizing and rightsizing may suggest a one-time fix, but many experts view this as an ongoing process for organizations of the future (Richman, LS, 1993). So what is organizational change? Organizational changes are departures from the status quo for smooth trends (Huber, GP, 1995). It is the process of altering or modifying the current state in terms of behaviors or functions (Harrington, N, 2008). The forces of change are everywhere, they can be found within the organization itself and they can be found in the external environment. The internal environment is affected by the organization’s management policies and styles, system and procedures as well as employee attitudes. The external environment is affected by political, social, technological and economic stimuli outside of the organization that causes changes (Benowitz, EA, 2011). Why do organizations change? Organizations change for many reasons but there are six broad forces that bring about change: workforce changes, such as diversity; technology changes, such as mobile computing; economic changes, such as stock market fluctuations; competitive factors, such as mergers and......

Words: 2351 - Pages: 10

The Consumers International Organization

...ABSTRACT Consumers International is charged globally with protecting every consumer in the world form unfair business practices. They are comprised of over 220 organizations in over 115 countries throughout the world. The Consumers International is dedicated to attaining a world where everyone has access to safe and sustainable goods and services. This basic concept is felt throughout their website and publications as they seem to keep their mission in the forefront of all they do. Consumers International endorse and share information on programs like recycling an renewable energy in an attempt to help nations preserve their environment. Consumers International is a non-profit organization based out of the United Kingdom and is considered to be the world federation of consumer groups. Founded in 1960 they have been fighting for a fair, safe and sustainable future for all consumers in a global marketplace. Consumers International is comprised of over 220 organizations in over 115 countries throughout the world. Their mission statement is “CI is working to put the rights of consumers at the heart of decision-making. Our vision is a world where everyone has access to safe and sustainable goods and services, and where the strength of our collective power is used for the good of consumers throughout the world.” They are backed by eight principles that guide and inspire the work they do, those values are: • The right to satisfaction of basic needs • The......

Words: 700 - Pages: 3

International Business

...International Business- Dr. R. Chandran 1. International Business: Meaning And Scope Interdependency is a natural phenomenon; nations, living beings and companies cannot totally depend on themselves. It is the major driving force for international business. Learning value: This chapter covers the essential aspects, 1. 2. 3. 4. 5. Definition of international business Emergence of developing nations in international business Motives of international business from companies and nations Fundamental differences between Domestic and International business Few successful organizations in Domestic & International business International business: Meaning and Scope In the post independence era, more than half-century Indian entrepreneurs concentrated on domestic operations and a surplus production was exported. The physical movement of goods, called EXPORT cannot represent International business. International business is defined as “any commercial transaction-taking place across the boundary lines of a sovereign entity”. It may take place either between countries or companies or both. Private companies involve themselves in such transactions for revenue, profit and prosperity. If governments are involved, they need to maintain their image, dependency and economic growth. Sometimes economic ties are strengthened through such transactions. These transactions include investments, physical movements of goods and services, transfer of technology and manufacturing. Today every......

Words: 70922 - Pages: 284

Iso International Students Organization

...INTERNATIONAL STUDENTS ORGANISATION PURPOSE The mission of the International Student Organization (ISO) is to foster understanding about diversity and the various cultures among the Indiana University Southeast (IUS) community at large, to provide an avenue to bridge the social gap among the students here at IUS and to provide a helping hand to the new incoming students in getting oriented to the USA. ISO is not for International students only but for the entire campus community at IUS. ISO is committed to - Increase the diversity awareness in the campus and the community.
- To establish a medium for cultural exchange between the students/faculty/staff and the community as a whole.
- To promote international support, assist the foreign students/visitors in establishing social contacts.
- To provide programs for cultural, social and educational exchange. The International Students Organization (ISO) of the University of Mississippi has been formed out of the need for more interaction between International students on the campus. Article I. Name

The Official Name of the organization shall be

INTERNATIONAL STUDENTS ORGANIZATION (ISO)

Article II. Purpose

The purpose of this organization shall be to provide a platform for social interaction among international students and help new international students adapt themselves to the Ole Miss community.

Article III. Membership

Section 1: There shall be no member who is not currently enrolled as a student at the......

Words: 6009 - Pages: 25

Organization of International Business

...Organization of International Business Organizational architecture—(organization structure, control systems, incentives, processes, organizational culture and people) Organizational Structure • Organizational structure has three dimensions: 1. Vertical differentiation - determines where decision-making power is concentrated within a structure 2. Horizontal differentiation - the formal division of the organization into sub-units 3. The establishment of integrating mechanisms - the mechanisms for coordinating sub-units Vertical Differentiation: Centralization • Facilitates coordination of activities Eg. A firm has a component manufacturing operation in Taiwan and an assembly operation in Mexico • Ensure decisions consistent with organization’s objectives • Allows top-level managers to bring about organizational change • Avoids duplication of activities Eg. Many international firms centralize their R&D functions into one or two locations to ensure the R&D work are not duplicated. Decentralization • Takes advantage of local information, which may result in better and faster decisions • Can motivate employees • Relieves top management • Can increase control in self-contained subunits • It can be worthwhile to centralize some decisions and decentralize others, e.g., centralizing control over core competencies while decentralizing operating decisions Horizontal Differentiation: The Design Of......

Words: 1728 - Pages: 7

International Business

...Petro Danyliv Professor Kathy Bowen Principles of Management Due April 2, 2014 International Business Nowadays international business and globalization became very popular and gained much more importance for each and every business company. Based on the quality research and the detailed analysis, this paper would come with the conclusion to show the advantages of globalization and also how globalization and international business can be a big factor in developing world’s economy. Term of globalization can represent and mean a lot of different things, but mainly globalization/international business are known for their flows of trade, finances and factors of production across the border, and transportation with effective communications set up. Globalization is responsible to make our world a “global village”. Globalization can develop strong international bonds not just between specific groups of countries but across a wide global network in which factors of production and also finished goods can move freely. The era of globalization in which we are living now came to existence not only because of Internet, but also because of changes in the institutional environment. Today globalization is a very popular and acceptable term. Globalization is a continuous and constant debate that society should face. The nature of globalization is somewhat specific and therefore understanding the meaning of it is crucial, so any praise or critics of globalization is purely......

Words: 918 - Pages: 4

Analysis of an International Organization:

...Analysis of an International Organization: Yum! Brands Inc. Kimberly A. Waters BUS310 Professor Dianna Anderson May 9, 2014 With over 40,000 locations in more than 125 countries that span across six continents, Yum! Brands Inc. is the world’s largest restaurant operator in terms of the number of locations it owns. Yum! Brands, based in Louisville, Kentucky is ranked #201 on the FORTUNE 500 list with revenues of more than $13 billion. It was named among 100 Best Corporate Citizens by Corporate Responsibility Magazine in 2013. The restaurant brands - KFC, Pizza Hut and Taco Bell are leaders of the chicken, pizza and Mexican-style food categories globally (Yum! Brands Inc., 2014). With this kind of credit and stature this company has, who would think Yum has any challenges within their company? Yum! has their fair share of common human resource challenges. They also have some uncommon challenges. These challenges include but probably are not limited to; low wages for employees, food safety issues, high turn-over, wage/hour violations and child labor rules. Challenges such as these have cost Yum! Brands thousands on top of thousands in fines, as well as bad media. Low wages is one of the biggest challenges in the fast food industry as a whole. Yum! Brands seems to have it worse than most. Reports show that a substantial amount of Yum’s domestic employees are paid very little and causes them to have to seek government or community assistance, just to feed their......

Words: 1913 - Pages: 8

The Organization of International Business- Organizational Structure at Procter and Gamble

...The Organization of International Business Organizational structure at Procter and Gamble Procter and gamble unique organizational structure offers the global scale benefits of an international company and the local focus to be relevant for customers in roughly 180 countries where their brands are solid. The company corporate structure provides the framework that allows them to tap the benefits of a global operation keep them in touch with local communities, and their strong governance practices ensure that they carry out operations with consistently high standard and integrity. Procter and gamble have made their organization structure an important part of their capability to grow. It combines global scale benefits with a local focus to win with consumers and retail customers in each country where P & G products are sold. Procter and gamble recently grouped its global business units into four industry-based sectors as part of the company’s on-going plan to improve business performance. The businesses in each sector are focused on common consumer’s benefits, share common technologies and face common competitors. Procter and gamble structure has removed many of the traditional overlaps and inefficiencies that exist in many large companies. Four organizational structure Procter and gamble uses:  Market development organizations: are charged with knowing consumers and retailers in each market where Procter and gamble competes and integrating......

Words: 2061 - Pages: 9

Role of International Organization in Trade

...Role of International Organization in Trade Contents Role of International Organization in Trade 2 Introduction 3 1- European Union 3 Introduction 3 European Union law 4 Role of European Union in international trade 5 European Union and the Maldives 6 2- Internal Chamber of Commerce (ICC) 6 Introduction 6 • Arbitration: 6 • Pre-arbitral Referee: 7 • Appointing Authority 7 • ICC ADR 7 • ICC Dispute Board Rules 7 • ICC International Centre for Expertise 7 • ICC International Centre for Expertise: 8 Role of International Chamber of Commerce in International Trade 8 Maldives and International Chamber of Commerce 8 3- United Nations Commission on International Trade Law (UNICITRAL) 8 The Role and Mandate of UNCITRAL 9 Legislative and Non-Legislative texts 9 Legislative text 9 Coordinating the work of other similar organizations 10 UNCITRAL role in International Trade 10 UNCITRA and Maldives 10 4- Organization for Economic Corporation and Development (OECD) 11 AIM 11 The work of the OECD 11 OECD and International Trade 11 • OECD Guidelines for Multinational Enterprises 12 OECD and Maldives 12 References 13 Role of International Organization in Trade Introduction Every nation in the world participates in international trade to some extent. And practically every product is either traded or relies on components from international suppliers. Trade is not just about physical goods, though. Knowledge and experience can be bought and sold......

Words: 3330 - Pages: 14

International Business

...Wal-Mart stores Inc. 3 3. Retail organization internatinalization expension 4 4. International Expansion of Wal-Mart in Maxico,china and canada 5 5. Comparison of Entry Modes 6 6. comparison of Opportunities 7 7. Final touch 8 8. Conclusion 9 9.Bibliography 10 1. Introduction: Being present and having to enter foreign markets is for many companies natural, while for other it is a new challenge that they have to face. This challenge, known as market entry, consists of three major decisions: where to enter, when to enter and how to enter different markets. Some companies are forced to internationalize in the early stages of their life due to small saturated home markets, while other companies choose to go abroad because of the great opportunities new markets might bring (Peng, 2006). Once deciding to go abroad and choosing the target market and timing, companies' need to consider the choice of entry modes. Generally, to choose international firm there are six different entry modes: exporting, turnkey projects, licensing, franchising, joint ventures, wholly owned subsidiary (Hill, 2004). Each entry mode its distinctive characteristics (see, e.g., Hill, 2004; Hill, et al, 1990; Hill and kim, 1988; Anderson and Gatignon, 1986; Madhok, 1997; Brouthers and Brouthers, 2000; Bishop 2006. Selecting a suitable entry mode is a difficult decision for firms interested in entering a foreign market (Agarwal and Ramaswami, 1992). Sometimes, an international firm may use more than......

Words: 5309 - Pages: 22

International Business

...International Business ( Semester 2, 2014) * Topic 1: Context * Globalization: There is no agreed or consistent definition for globalization but the key features including: * Everything and everyone equal * Intensive and rapid flows cross border flows (eg product, finance) * Not just economic but social, culture also. * Implication for nation states (countries)- a loss on power for the countries on politically as well as economically. * “ Globalization is about growing mobility across frontiers- mobility of goods and commodities, mobility of information and communications products and services, and mobility of people” ( Robins 2000). * Globalization has become a leading concept in doing business during last few decades, there are various aspects of globalization that influencing in doing business such as Competition, exchange of technology, knowledge/information transfer. * Competition: there is increase in competition. It can relate to product, service cost, price, target market, technological adaptation, quick response, quick production by companies. Company needs to focus on production with less cost to sell cheaper in order to increase its market share. On the other hand, customers also have a large multitude of choices in the markets and it affects their behavior: they want to acquire goods and services quickly and in more efficient way than before with high expectation in quality and low prices. * Exchange of...

Words: 12315 - Pages: 50

International Environmental Organization

...Mid-Term paper.             INTERGOVERNMENTAL ORGANIZATION WORKS ON FRESH WATER                     Outline   1. Summary   2. Introduction of Fresh Water   2-1. Fresh Water Resources   2-2. Fresh Water and Public Health   2-3. Fresh Water Pollution   3. UN-Water   3-1. Governance and Organization of UN-Water   3-2. Programmes of UN-Water   4. References                             Summary   We have finite resources. But world’s population numbered 6.1 billion in 2000 and it is currently increasing at a rate of 77 million per year. By 2025, the estimated total world population will be 7.9 billion. More people means that more consumption. More consumption means that more resources. Again we have finite resources. One of the precious resources is fresh water. Fresh water is key to sustainable development for both economic activity and social role. Without water supply human health fails, food production declines, the natural environment suffers. Freshwater is an important determinant of patterns of economic growth and social development. But due to increasing world population (more consumption), fresh 97water resource is dramatically falling to down. Due to scarcity of fresh water, 500 million people suffering water stress. It will be increase to two-thirds of the world population subjected to moderate to high level water stress in 2025. Also it is very important to improving both quality and quantity of available water......

Words: 1512 - Pages: 7

International Business

...CHAPTER 6 BUSINESS-GOVERNMENT TRADE RELATIONS LEARNING OBJECTIVES: 1. Describe the political, economic, and cultural motives behind governmental intervention in trade. 2. List and explain the methods governments use to promote international trade. 3. List and explain the methods governments use to restrict international trade. 4. Discuss the importance of the World Trade Organization in promoting free trade. CHAPTER OUTLINE: Introduction Why Do Governments Intervene in Trade? Political Motives Protect Jobs Preserve National Security National Security and Imports National Security and Exports Respond To “Unfair” Trade Gain Influence Economic Motives Protect Infant Industries Pursue Strategic Trade Policy Benefits of Strategic Trade Policy Drawbacks of Strategic Trade Policy Cultural Motives Cultural Influence of the United States Methods of Promoting Trade Subsidies Subsidies in Media and Entertainment Drawbacks of Subsidies Export Financing Foreign Trade Zones Special Government Agencies Methods of Restricting Trade Tariffs Protect Domestic Producers Generate Revenue Quotas Reason for Import Quotas Reasons for Export Quotas Voluntary Export Restraints Tariff-Quotas Embargoes Local Content Requirements Administrative Delays Currency Controls Global Trading System General Agreement on Tariffs and Trade (GATT) Uruguay Round of Negotiations Agreement on Services......

Words: 2900 - Pages: 12

Business Organizations

...Theories can be applied to a variety of things, and compared to individual, group and animal behaviors. After reading Adler, Mech and Morgan, it is possible that the relationship between humans and animals is very similar when we talk about organizations. In the book Images Of organization, Morgan suggests that we live in an “organizational” society and that organizations influence our every waking hour. And although this is very obvious, one has to wonder why people build their lives around organizational behavior. Examples of this would be, taking time off from work, going to work five times a week or being a full time student. These are routines that each of us has in our own lives, and we all relate to them within our culture in similar ways. In The Wolf, Mech talks about Courtship and Mating in wolves. I compared this reading to Morgan’s because in many ways it relates to culture. “Courtship and mating in the wolf are intimately related to each animal’s year –round ties with other members of its pack” (Mech pg. 111). This clearly shows the reader or whoever is studying wolves that this behavior occurs within the culture of the pack and how similar this behavior is with other animals living in the wild. Culture and organization played in my work life. I used to work at a grocery store and everyone one on the team had similar duties, especially the cashiers. We were pretty much programmed to say the same things, and if we forgot to ask the customer for their......

Words: 1984 - Pages: 8

Não Olhe para Trás (Danny Collins) 2015 | Add comment | Contact Us