Topic 1 Introduction to the approaches in comparative

international management

Self develops through our relationships to the places where

we grew up.
- People also develop association with places which may carry positive or
negative connotations, and which may shade consumers’ evaluations and
willingness to purchase

Management & Organization

The term ‘society’ does not state a clearly bounded entity or collectivity at
a level of aggregation opposed to individuals.
Make their peace with ethnic diversity within and across nation states.

Organization and management theory

It has explained structures and processes with reference to the following
sets of factors:
1. Task environmental characteristics such as organization size;
differentiation, variation and innovation of output; technology of
producing products or services.
2. Generic strategies which establish a connection between
management action in different functional, geographical or
product-/service-related activities, and which also effect on task
environment characteristics.
3. Institutional and cultural factors, how personalities are formed,
by education and parental or other socialization.

Explain differences between management and organization in

different countries in 3 major ways:

1. The mind of human actors: called the ‘mental programming’ of

actors and compare this across countries.
2. Institutions typified patterns of behavior, with a weaker or
stronger normative foundation.
3. Interrelation of these two: in order to know the actor, we need to
know the institution. We have to look at how actors understand it and
practice it. This yields culturalist and institutionalist approaches.

The cultural approach

• The focus is on the cultural rather than the individual level.
• Culture is considered to be a background factor, similar to contingency
theory.
• Micro focus, investigating the similarities and differences in attitudes of
managers of different cultures.

The institutional approach

• they focus on ‘wider norms and standards supported or enforced by
institutional machineries’ as opposed to
• ‘the culturalist’ focus on the mind of the individual as the place where
differences reside’

Topic 2 National cultures and management – the

approach
Defining culture
Culture consists of patterns, explicit and implicit of behavior acquired and
transmitted by symbols, constituting the distinctive achievements of
human group, including their expression in artifacts; essential core of
culture consists of traditional, ideas and especially their attached values;
culture systems may be considered as products of action.
Stereotypes, over simplified images of members of the other groups, not
based on direct experience.

ASS2
Mixed economy
A mixed economy is a system that combines characteristics of
market, command and traditional economies.
A mixed economy has three of the following characteristics of a
market economy. First, it protects private property. Second, it allows the
free market and the laws of supply and demand to determine prices.
Third, it is driven by the self-interest of individuals.
A mixed economy has some characteristics of a command economy
in strategic areas. It allows the federal government to safeguard its people
and its market. The government has a large role in the military,
international trade, and national transportation.allow the government to
own key industries. These include aerospace, energy production, and
even banking. And also manage health care, welfare, and retirement
programs.
Most mixed economies retain characteristics of a traditional
economy,
For example, they still fund royal families. Others invest in hunting
and fishing.

Advantages of a Mixed Economy

A mixed economy has the advantages of a market economy. First, it
distributes goods and services to where they are most needed. Second, it
rewards the most efficient producers with the highest profit. Third, it
encourages innovation to meet customer needs more creatively, cheaply
or efficiently.

Disadvantages of a Mixed Economy

It just depends on which characteristics the mixed economy
emphasizes. For example, if the market has too much freedom,
it can leave the less competitive members of society without
any government support and it’s may cause social inequity and
income disparities.

International Investing
Developed markets
A developed market refers to a country that many similarities
with the U.S.
 More economic security
 Robust industries
 Stable infrastructure
Ex.the U.K. , France, Germany, Japan

Emerging markets
An emerging market refers to a country that isn’t as developed
as the U.S. and is where you would likely see;
 Rapid growth and development
 Lower per capita income < 13950 B/m
 Less mature financial markets
Ex. Brazil, Russia, India, China

The Rules of Globalization

Until 2008 we’ve entered a different phase, one of guarded
globalization. Governments of developing countries have become opening
more industries to multinational companies. They are defining national
security more broadly and more of strategic. Indeed, the rise of state
capitalism in some of the world’s most important emerging markets.

To factor globalization’s new risks into strategy, executives must

consider their industry’s strategic importance to the host government and
their home government. They can choose among various approaches:
strike alliances with local players, look for new ways to add value abroad,
or stay home.

One, many governments find it risky to continue opening industries

to foreign competition, because local companies and consumers often
block new entrants. Two, some countries have built large foreign
exchange reserves and boosted exports, so they are not trying to attract
large amounts of foreign investment. Three, governments are defining
national security more broadly. Finally, policy makers in developing
countries are take place to create uneven playing fields that give local
players advantage.

Distance still matters

The Four Dimensions Of Distance The types of distance influence
different businesses in different ways

Cultural Distance
o A country’s cultural attributes determine how people interact with
one another
o Differences in religious, beliefs, race, social norms, languages,
ethnicities
o Distance affects: products with high linguistic content, products
affect cultural of consumers
o Cultural distance affects consumers product prefer fences.

Administrative or Political distance

o Historical and political backgrounds: absence of colonial ties,
absence of political association, government policies, institutional
weakness.
o Common Barriers like tariffs, trade quotas, preferences for
domestic competitors to restrict foreign competitors
o Companies avoid doing business in countries known for corruption
or social conflict

Geographical Distance
o Geographic distance affects the costs of transportation and
communications
o GD important to companies whose operations require a high
degree of coordination among highly dispersed people

Economic Distance
o the wealth or income of consumers
o Companies that rely on economies of scale should focus more on
countries that have similar economic profiles
 o All companies find that disparities in supply chains and distribution
channels are barrier to business.

The Cosmopolitan Corporation

Differences still do matter.

Crafting a global strategy is possible, but you must focus on

understanding the differences among people, cultures, and places. One
tool that can help you handle on critical differences is a rooted map, which
reflect a nation’s perspective, such as the amount of industry services
they purchase from domestic companies.

A cosmopolitan approach may lead firms focus more on adaptation

to local markets than aggregation. Firms will have to think about how to
readjust their organizations to better manage external distances, and they
must cultivate leaders who know how to bridge cultural and national
differences.