Challenges Faced By Firms Such As Multi National Companies ( Mnc )

Doole and Lowe (2008) emphasizes how important it is for Global managers to understand the economic development in countries where it wants to expand to and how they impact on the overall strategy of the Firm (Doole &Lowe, 2008;pp 12-13). This knowledge is important at a world level in terms of the world trading infrastructure such as world institutions and trade agreements developed to foster international trade, at a regional level in terms of regional trade integration and at a country/market level (Doole &Lowe, 2008; pp 12-13).

Conditions have changed. Global trade has rapidly increased in both volume and value, reaching nowadays more than $4 trillion in 1997 (Daniels J.D., Radebaugh, 1998, pg. 529). Competition is fierce from all corners of the world. Failure at the global level can backfire and may consume existing brands and business relationships. At the same time, global opportunities have emerged that offer possibilities for growth, profit, and an improvement in worldwide standards of living.

Hill, C. (2011). International business, competing in the global marketplace. (8 ed.). New York, NY: McGraw-Hill Irwin.

In the business industry, if businesses want to export their goods and services to other countries, they must become familiar with and adopt international and global strategies. Consequently, there are three types of international and global business strategies. The first type is international, which entails conducting a significant amount of activities outside the home country, yet its focus remains on the home market (Fung, 2014). The second type is multinational, which consists of operating in multiple countries, yet the headquarters is in its home country, not to mention that the competitive advantage will vary by country (Fung, 2014). The third and final type is global, which is when the organization treats the whole world as one market and one source of supply, not to mention, that its competitive advantage is contingent of common brands, standardized products, and global scale production (Fung,

Conglomerate Coca-Cola is a company that prides itself on being the world’s largest beverage company, and one who embodies the cross borders concept of international business by being recognised by no less than 94% of the world’s population is an undoubted success story. However, the company is not immune to the various political, economic, social and technological factors (PEST) that can affect their international operations and, in turn, the future development of the firm.

Coco-Cola, a sugary soft drink, was developed by a pharmacist known as Dr. John S. Pemberton. The company has been was established in 1892, and has since then undergone expansions in terms of product packaging, product variety and location. Today, the Coca-Cola company is “the world’s largest manufacturer, distributor, and marketer of non-alcoholic beverage concentrates and syrups” (Coca-Cola Company (KO), n.d.), and “operates in over 200 countries and sells more than 400 different brands that produce over 3000 different products” (Coca-Cola Company (KO), n.d.). With the growing concerns for health today, consumers are more health-conscious

Coca Cola’s international achievement can be attributed to numerous of things, but in order to think globally one must first think locally. This is the main message that Coca Cola Company place huge emphasis on whenever they are entering a country. (Miller) Coca Cola has formatted its approach strategically using a tactical method, this is done to provide the appropriate marketing activities and beverage to its customers. As part of Coca Cola vision to taste the same around the world, they have chosen to standardize its product and manufacturing process. In Trinidad and Tobago the local name for Coca Cola is “Coke”. From the perspective of consumers the key conceptual categories are not the flavours and colas that marketer hold in high regard, but what we refer to locally as the ‘black’ sweet drink. (Miller) Trinbagonian’s are particularly fond of sugar and sweet products this is linked to the days of the sugar cane field. Coke came into Trinidad in 1939, while under the British Government. (Miller)

One big change that needs to be made is pesticide free water in the Coca-Cola products. Indians have a lot of trouble with making sure their food and water is contaminated, and things like this aren’t going to help Coca-Cola’s business because they aren’t going to want to risk their health. Indian’s need to feel safe and trustful of Coca-Cola that their products are safe for themselves. Coca-Cola made also need to use less Indian water in their products if that problem cannot be fixed. Whatever it takes for Indian’s to understand that Coke’s products are pesticide free is what Coca-Cola needs to do. The future of Coke in India is in the hands of

All business (sales, logistics, transportation, investments) that take place between two or more countries or nations is called International Business. International Business is a practice that not only involves commercial transactions, but also the exchange of economic resources, skills, people, capital, etc. to produce or provide services to various industries. Over the years many companies have ventured into other areas beyond their political boundaries to make their businesses multi-national. Companies such as McDonald’s, H&M, FedEx, LG, Shell, and so many more. Companies face many obstacles when

The level of internationalisation around the globe has grown throughout the years, with advanced technologies the ease and ability to work with foreign countries has also grown. However, firms do not simply interact with each other with no outside party involvement; the government can be seen to play a large role in conducting international business. Governments continuously have the responsibility to act in the manner that they believe is best for their nation; this includes decisions regarding protectionism, which may serve to aid domestic industries but simultaneously hinder international business. It can be seen that governments do not always act in their nation’s best interest and are corrupt which can serve to increase the risks and costs of entering an international business environment. While these are examples in which the government makes international business difficult it can also be seen that the presence of a government is instrumental in creating international business effectiveness, whether this be through their legal system or from trade agreements. This makes the role the government plays paradoxical; as their involvement generally increases the risks and costs of firms seeking to internationalise, whilst simultaneously playing a significant role in creating international business effectiveness.

The objective of MNC to operate in other countries is to gain competitive advantage through several ways. Firstly, MNC is able to take advantage of difference in country-specific circumstances. For example, MNC may choose to locate its productions in less developed country like Vietnam to gain cheap labor cost. Secondly,

The information from this article concludes that what business movements of Coca-Cola have been implemented on Burma, Cuba, North Korea, and other countries under different economic environment. The article also reveals the global expansion of Coca-Cola Middle East, Europe and Asian, and the mutual effect between the development of Coca-Cola and global environment. This article is helpful to the research topic since the business actions of Coca-Cola on different countries could reflect the effectiveness of organization’s performance. The limitation of the article is that the factor could affect the business action are mostly political. This article identifies the related performances of Coca-Cola. Therefore

“International business is the study of business activities that cross national boarders… and the national governments that regulate them” (Behrman & Grosse, 1992, p. 93). As well as briefly defining international business the above quote highlights that it is severely impacted by policy makers. It is important to investigate the relationship between the government and firms which undertake business overseas, in order to understand how and why governments intervene in international business. In recent history, the host country’s government has intervened more frequently in the businesses of multi-national corporations. This is due to the fact that governments are becoming increasingly aware of the risk that foreign firms can pose when conducting business in their country (Doz & Prahalad, 1980). One economic reason for imposing restrictions on international trade is to protect infant industries. An infant industry is any “newly established type of activity for which the economy’s existing endowment of skills and human capital…” does not allow the industry to thrive immediately (Westphal, 1982, pp. 256). Once the industry is capable the government may decide they no longer need to impose restrictions on imports, and the country’s economy will strengthen as a result of this newly formed industry. Another important reason why governments intervene in international business is in order to protect local jobs. If a government is unable to effectively protect the jobs of its

When entering new markets, multinational corporations (MNCs) often form strategic alliances with local companies. An alliance is where two or more organisations integrate to form a strategic, business relationship (Finlay, 2000). The potential benefits of such alliances include access to knowledge and resources, building a global network, market access, recognition and access to a distribution network which can all provide MNCs with a competitive advantage in a foreign market. However, MNCs also face many challenges when forming alliances in other countries including loss of intellectual property, different expectations, various challenges of globalisation (e.g. more stringent regulations being imposed on foreign firms), ethical and cultural considerations and change management. This essay will focus on two of these challenges in depth - change management and cultural adaptation. However within these sections, certain other topics will also be considered including leadership, innovation and diversity and globalisation. This essay will critically discuss and analyse these challenges drawing on real world examples, academic theory and additional research. It will also highlight and consider potential solutions to these challenges.

In the modern world, every organization carries out their business in several countries. Multi-national companies will and can adopt different strategies through the people, their employees. In this diversity of human resources management, business firms adopt the practices and policies according to the environment and culture. The ecological and ethical challenges, political and economic instabilities, and globalization are other issues which also faced by today business firms.