Why compete globally

Systems What do you think is the best way for a small company to enter international trade? Information Identify some U.

How do you think they have achieved their success? Information Team Activity Divide the class into teams. Each team should choose a country and research its infrastructure to determine how it will help or hinder trade.

Include a variety of countries, ranging from the most highly developed to the least developed. Resources, Interpersonal, Information, Technology. Ethics Activity The executives of a clothing manufacturer want to outsource some of their manufacturing to more cost-efficient locations in Indonesia.

Click on Foreign Trade Barrier Examples, and then search the reports. Pick a country that interests you from the index, and read the most current available reports for that country. Would this country be a good market for a small U.

Why or why not? What are the main barriers to trade the company might face? Select one that interests you, and summarize what you learn about it. Review the historical data about exchange rates between the U. Pull up charts comparing the yen to the dollar for several years. List any trends you spot.

What years would have been best for a U. Given current exchange rate conditions, do you think Japanese companies are increasing or decreasing their exporting efforts in the United States? What types of information does the site provide? Which would be most useful to a company looking to begin exporting? The energy picture is somewhat brighter for American consumers.

Though the cost of electricity has bumped up somewhat, we continue to pay comparatively and historically low prices. Today, as ever, the majority of employers struggle finding qualified workers—it is among the most cited problems faced by executives. And we place last in the proportion of college students receiving degrees in the skills of science, engineering and math.

Still, the majority of small enterprises find it difficult to obtain credit. Similar leaps were evident in the soundness of our banks, national saving rates, country credit rating availability of financial services, venture capital availability, access to loans, and in financing through local equity markets.

Our world ranking of 15th in the Internet and Communications Technology Development Index has held steady over the years, but for the global leader in the digital economy, anything but the highest ranking in ICT development is unworthy.

The World Bank downgraded our standing in its Ease of Doing Business report to 8th place after registering at 4th place in The United Stated hopped to 27th place from 39 th —a positive but poor showing for the global leader of democracy, freedom, and human rights. As noted above, the World Economic Forum continues to rate the quality of math and science education in the United States as extremely poor, placing us 33rd in its most recent evaluation.

In a very positive ranking, we now lead the world in innovation cluster development. Learning Objectives Understand the opportunities and challenges associated with competing globally. Learn the differences between competing globally and competing domestically. Explore the factors that a firm that is competing globally must consider. Details Pub Date: Jun 30, Discipline: Strategy. Subjects: Competitive strategy Foreign investments Global strategy International business.

Source: Harvard Business Publishing. If currency exchange rates were to change such that the euro became weaker relative to the South Korean won, this would make a Kia more expensive for European buyers Kia.

The history of business is full of colorful examples of cultural differences undermining companies. For example, a laundry detergent company was surprised by its poor sales in the Middle East. Executives believed that their product was being skillfully promoted using print advertisements that showed dirty clothing on the left, a box of detergent in the middle, and clean clothing on the right.

A simple and effective message, right? Not exactly. Unlike English and other Western languages, the languages used in the Middle East, such as Hebrew and Arabic, involve reading from right to left. To consumers, the implication of the detergent ads was that the product could be used to take clean clothes and make them dirty.

Not surprisingly, few boxes of the detergent were sold before this cultural blunder was discovered. A refrigerator manufacturer experienced poor sales in the Middle East because of another cultural difference. The firm used a photo of an open refrigerator in its prints ads to demonstrate the large amount of storage offered by the appliance. You would likely be disgusted.

In some parts of world, however, horse and dog meat are accepted parts of diets. Firms must take cultural differences such as these into account when competing in international markets.

Cultural differences can cause problems even when the cultures involved are very similar and share the same language. During the Summer Olympics held in Sydney, Australia, clothing manufacturer Roots was the official outfitter for members of the Canadian Olympic and Paralympic teams. In , RecycleBank expanded its operations into the UK.

The word scheme implies sneakiness when used in the United States, but a scheme simply means a service in the UK Maltby, Differences in the meaning of English words between the United States and the UK are also vexing to American men named Randy, who wonder why Brits giggle at the mention of their name Figure 7.

Carmichael, K. The Globe and Mail. Chesto, J. Boston company gives up on offshoring call center jobs to India, moves them to Maine instead. Flavelle, D. The Star. Isidore, C. July 2. Made in USA: Overseas jobs come home. Best-ever monthly and quarterly retail sales for Kia Europe. Kia Corporation. Kia sales climb strongly in 10 countries in May. Kostigen, T. Market Watch. Wall Street Journal. Maltby, E. Expanding abroad? Avoid cultural gaffes.