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International Business Management: Paving the path towards a transnational market

When the floodgates were opened a few years ago and multinational companies started their business in our country, everyone was skeptical about the nature of growth in our country. But all were pleasantly surprised by the success of globalization. The tremendous workforce in our country contributed to the stupendous annual growth. Due to this, international business management received afresh impetus and the demand of MBA in International Business Management increased manifold.

International business management deals with global commerce and seeks to break the shackles of geographical and political boundaries. Since the internet has acted as a powerful tool in making the world accessible, the variety of careers awaiting the youth is plenty. In this context, MBA in international management has a great future. In order to make it a successful career, you have to develop an interest in global politics, culture, time and money, which play an important role in making you a good business professional. You have to develop a proficiency in knowing the market principles of different countries.

The need for MBA in International Business Management:-

If you want to study MBA in International Business Management, you must have an ear for grasping the economic pulse of different countries. You should be ready to work as an executive whose area of functioning is diverse. You have to develop strategies to deal with multicultural concerns keeping in mind the sensitive international relations.

With the advent of multinational companies in India, the domestic companies are also inspired to spread their wings and venture in different directions outside the country. This factor is causing a tilt towards international business management. Be it government agencies or banks; everyone has a need for people with MBA in International Business management. With opportunities knocking at your door, you should be intelligent enough to grasp it with both hands and make the most of it.

Even if you haven’t done your MBA but are already working in a company which is looking to globalize, you need not worry. You can still complete your education by enrolling for an MBA in International business management now. Not only will this enhance your prospects in the company, but you can look to get into better companies as well. The skills that you learn will certainly help you out.

What will you get after doing an MBA in International Business Management?

Once you apply for a degree in International Business Management, you must be curious to know about your prospects. A general study shows that you can expect an annual salary of Rs. 5 – Rs. 10 lakhs if you are employed by a reputed company. You job may help you to settle in different countries and get a diverse experience. You must however look for job satisfaction and the scope for career growth in whatever you do.

An MBA in International Business management can be very lucrative and will surely provide you with many avenues for developing your skill in international business. You can also develop a passion for learning foreign languages to further your business acumen. With a degree in international business management, you can aim to place India on the top of the world map. There can be no dream better than that.

Approaches to International Human Resource Management

Approaches to International Human Resource Management


* Dr.Shanmukha Rao Padala & ** Dr.N.V.S.Suryanarayana


             Corporate management philosophy is an important issue because it decides how a firm views the world in relation to itself and how it wants to manage human resources in different countries. HR manager at international level must not only select people with skills, but also employees who can mix with the organisations’ culture. General Electric, for example, is not just hiring people who have skills required to perform particular jobs, it wants to hire employees whose style, beliefs, and value system are consentient with those of the firm.

            Corporate culture and management philosophy, to a great extent decide the formulation and implementation of corporate and operational strategies and their evolution into various stages of internationalization. Companies involved in world trade and investment can be divided into four types based on their management approach and corporate philosophy:



Ethnocentric Organisation:

            There motto is ‘this work in my country therefore, it must work in other countries also’. These are home country oriented organization. Example, when a Japanese corporation invests in Mexico, Japan is the home country and Mexico is the host country. If the Japanese Corporation is ethnocentric, it will except Mexicans to accept the inherent superiority of Japan. Investments will be made on the Japanese methods of conducting business.

            In this approach, all key management positions are held by parent country nationals, e.g., Toyota, Matsushita, Samsung etc. this strategy may be appropriate during the early phases of international business, because firms at that stage are concerned with transplanting a part well in their home country. Ethnocentric corporations believe that home country nationals are more intelligent, reliable and trust worthy than foreign nationals. Firms such as Procter and Gamble, Philips, and Matsushita originally followed the ethnocentric approach.

            In this approach, all important positions in MNCs are filled up by PCNs in the early stages of internalization. Apart from this, for certain business-related reasons which are as follows:

A perception that qualified HCNs may not be available for the units;
To ensure that coordination and communication are maintained adequately in headquarters.

But, these are several problems in adopting the approach. Some of them have been pointed below:

An ethnocentric staffing policy limits the promotion opportunities of HCNs, which may lead to reduced productivity and increased turnover among that group.
The adaptation of expatriate managers to host countries often takes a long time during which PCNs make mistakes and make poor decisions.
When PCN and HCN compensation packages are compared, the often considerable income gap in favour of PCNs is viewed by HCN, as unjustified.
For many expatriates, a key international position means new status, authority and an increase in standard of living. These changes may affect expatriates sensitivity to the needs and expectations of their host country subordinates.


Apart from, this the cost of maintenance of expatriates is quite high. This approach is not only reflected in the staffing policy but in all other areas such as performance appraisal where evaluation format is designed and administered by parent nationals and new product development is done in the home country. Many international companies exhibit this ethnocentric philosophy. They have difficulty in communicating in different languages and accepting cultural differences. But ethnocentrism limits strategic alternatives to entry modes, such as exporting, licensing and than key operations.


Polycentric Organisations:

            These motto is ‘when in Rome do as the Romans do’. When you are elsewhere lives as they live elsewhere. The polycentric staffing requires host country nationals to be hired to manage subsidiaries, while parent-country nationals occupy key positions at corporate headquarters. Although top management positions are filled by home-country personnel, this is not always the case. They see profit potential in a foreign country but find the foreign market difficult to understand.

            The polycentric message is: ‘Local people know what is best for them. Let’s give them some money and leave them alone as long as they make us a profit.’ Governmental pressure and foreign laws often necessitate polycentric approach. The local government may be a major customer and insist on local ways to be adopted. Many multinationals adopt this approach because they face the heterogeneous environments in which product preferences may be the deciding factors and strategies are to be developed on a market by market basis. There are several advantages with this approach are outlined below:

Employing HCNs eliminate language problems for the expatriates and their family members, reduces cost on costly awareness training programs, and takes care of the adjustment problems to a large extent.
In politically sensitive situations, it helps the MNCs to maintain a low profile.
Even though high salaries may have to be given to attract HCN applicants, it still works out cheaper for the company in the long run as compared to employing PCNs.
The crucial problem of turnover experienced when employing PCNs can be avoided effectively by employing HCNs, since they are more stable and can help in maintaining the continuity in managing subsidiaries more efficiently.

Some are they problems are as follows:

Bridging the gap between HCN subsidiary. Managers and the PCN managers at headquarters is a major problem, especially with regard to language barriers, conflicting national loyalties and differences emanating from personal values, attitudes to business and so on. This may result in a MNC becoming a ‘federation’ of independent national units with weak linkages to the corporate head quarters.
Lack of exposure to international assignments among PCN managers at headquarters and lack of career mobility among HCN managers due to their stagnation in subsidiaries will ultimately affect the strategic decision-making capabilities, reducing their market share and customer base and their position in the foreign country vis-a-vis their competitors.


Regiocentric Organization:

            These are regionally oriented organizations. A Corporation implements a regional strategy when synergistic benefits can be obtained by sharing functions across regions. The international staff is transferred with in the same region they work, example, for a global firm having a number Asia-Pacific, European and US, a manager working in Asia-Pacific region will be moving within the same region only, if the company adopts regiocentric approach. Regional headquarter organizes collaborative efforts among local subsidiaries, it is responsible for the regional plan, local research and development, local executive selection and training, product innovation, cash management, brand policy, capital expenditure and public relations.

            The headquarter managers world strategy, country analysis basic research and development, foreign exchange, transfer pricing, inter company loans, long-term financing, selection of top management, technology transfer and establishing corporate culture. The advantages of using a regiocentric approach are:

It allows interaction between executives transferred to regional headquarters from subsidiaries in the region and PCNs, posted to the regional headquarters.
It reflects some sensitivity to local conditions, since local subsidiaries are staffed almost totally by HCNs.
It can be a way for a multinational to more gradually from a purely ethnocentric or polycentric approach to a geocentric approach.


Disadvantages of regiocentric policy.


It can produce federalism at a regional rather than a country basis and constrain the organization from taking a global stance.
While this approach does improve career prospects at the national level it only moves the barrier to regional level staff may advance to regional headquarters but seldom to positions at the parent headquarters.


Geocentric Organisation:

            This staffing philosophy seeks the best people for key jobs throughout the organization, regardless of nationality, selecting the best person for the job, irrespective of nationality is most consistent with the underlying philosophy of a global corporation. The MNC is taking a global approach to its operation, recognizing that each part (subsidiaries and headquarters) makes a unique contribution with its unique competence. It is accompanied by a worldwide integrated business and nationality is ignored in favour of ability. There are three main advantages to its approach:

It enables a multinational firm to develop an international executive team which assists in developing a global perspective and an internal pool of labour for deployment throughout the global organization.
It overcomes the federation drawback of the polycentric approach.
It supports cooperation and resource sharing across units.


There are disadvantages associated with a geocentric policy.

Bridging the gap between HCN subsidiary managers and the PCN managers at headquarters is a major problem, especially with regard to language barriers, conflicting national loyalties and differences emanating from personal values attitudes to business and so on.
Host government want a high number of their citizens employed and may utilise immigration controls in order to force HCN employment if enough people and adequate skills are unavailable.
Many western countries need extensive documentation if they wishes to hire a foreign national instead of a local national, which is time consuming, expensive and at times, futile.
A geocentric policy can be expensive to implement because of increased training and relocation costs. A related factors is the need to have a compensation structure with may be higher than national levels in many countries.
Lack of exposure to international assignments among PCN managers at headquarters and lack of career mobility among HCN managers due to their stagnation in subsidiaries will ultimately affect the strategic decision-making capabilities of both the groups of managers, thereby affecting the firms, and the quality of their business decisions and their resource allocation capabilities, reducing their market share and customer base and their position in the foreign country, vis-a-vis their competitors.
Large numbers of PCNs, TCNs and HCNs need to be sent abroad in order to build and maintain the international team required to support a geocentric staffing policy. To implement a geocentric staffing policy successfully, therefore, requires a longer lead time and more centralized control of the staffing process. This necessarily reduces the independence of subsidiary management in these issues, and this loss of customarily may be resisted by the subsidiary.


Philosophy toward staffing:

            Based on top management attitudes, a multinational can pursue one of several approaches to international staffing. It may even proceed on an adhoc basis, rather than systematically selecting one of the above four approaches. The dangers with the approaches are: ‘The firm will opt for a policy of using parent-country nationals in foreign management positions by default, that is, simply as an automatic extension of domestic policy, rather than deliberately seeking optimum utilization of management skills.’


International Trade Management – Initiatives That Result in Measurable Growth in ROI

Publishing Guidelines: You may publish my article in your newsletter, on your website or in your print publication provided you contain the resource box at the end. Notification would be appreciated nevertheless is not required.

By S. Maurer

On this digital Century the business and Data Technology administrations is radically moving to the Next-Generation of Business Administration. For that reason, this series of articles will exhibit essential tips from us and also we included very fews from public sources about this specific business or this fresh method of doing business. In spite of the circumstance that very fews tips are public domains, if asked for that the source will be always mentioned.

What is International Trade Management?: If you choose to export directly, you must be willing to devote more time, money, personnel and other enterprise resources.

What is International Trade Management?: Disputes often occur in the distribution cycle over which party must bear the loss of a shipment due to a contention that the carrier had not yet taken control of the shipment or had made a “delivery” according to the bill of lading.

What is International Trade Management?: If an exporter can find a virgin market that is devoid of happening and potential competition, there may be no call for to adapt or localize the product since the potential buyers have no choice. But [IT] is very dense to find a nation in the contemporary market environment where there is no competition.

What is International Trade Management?: manufacturer trade associations are also useful, as are private consulting firms [such as Terence Barber's BHP Associates] and the business departments located within major universities.

What is International Trade Management?: Establishing district Customer preferences and evaluating competitive products and enterprises in the target market is elemental.

What is International Trade Management?: In order to speed up the amendment process, the issuing bank may be tempted to add a clause to their amendment indicating that the beneficiary has a certain timeframe to either accept or reject the amendment.

What is International Trade Management?: You call for to weigh many of the same factors you would when pricing for domestic markets, such as the costs of production, packaging, transportation and handling as well as promotion and selling expenses.

What is International Trade Management?: Because of the warming of relations with the West, the Vietnamese market is opening up. Many of the Vietnamese living here have strong links with family and friends still living in their native country. The same is true of the Hispanic population. Owners of small businesses should be looking at an Hispanic workforce as a strategic opportunity.”

What is International Trade Management?: One area in which you should definitely seek assistance is market research. You can get up-to-date facts from the U.S. Commerce Department’s Trade Facts Center and the SBA. The SBA and its volunteer offshoot, the Assistance Corps of Retired Executives [SCORE], can also aid you with marketing or distributing your commodity.

What is International Trade Management?: Trademark protection and patent decree comprise another critical area that requires your attention. A vexing difficulty for many U.S. enterprises doing business abroad, especially in developing countries, has been the pirating of intellectual property. The Western belief of “owning” an belief is as foreign to many cultures as the belief of private property.

What is International Trade Management?: The cost of petroleum products along with a country’s infrastructure, for example, may mandate the call for to develop products with a greater level of energy efficiency.

What is International Trade Management?: The example of Indemnity Insurance Co. of North America v. Hanjin Shipping, 348 F.3d 628 [7th Cir. 2003] involved a shipment of tools from Shenzhen, China, to a Lowe’s facility in North Vernon, Indiana, moving under a through multimodal ocean bill of lading.

What is International Trade Management?: A country’s average of living and the target market’s purchasing ability can also determine whether a enterprise needs to modify a product.

What is International Trade Management?: A globe of opportunity awaits outside the U.S. borders. Despite calls for protectionism by a number of business and Administration leaders, trade agreements and the reconfiguration of nations are creating a global marketplace that offers fresh horizons for enterprises willing to venture out.

What is International Trade Management?: Carrier liability ends when delivery has been completed. Again, this is a inquiry of event that often involves a “dropped” trailer. When [IT] is the carrier’s duly to unload the trailer, dropping the trailer in the consignee’s premises does not constitute delivery.

Indira Global Business School: Taking Business Management to a New Level

Can you deny the significance of business management in today’s fast paced competitive world? Its importance is being widely recognized by almost every corporate house that is open for greater results and more development. Taking into consideration the growing demand for global business management and the need for more dedicated business professionals in the market, Indira Group of Institutes established the Indira Global Business School (IGBS) IN 2009.

Since its inception, Indira Group of Institutes has been dedicated towards instilling a sustainable drive in today’s youth to learn entrepreneurial and corporate abilities. The ever growing demand for bright business professionals needs to be met and this is what led to the start of Indira Global Business School. Within two years, this school has marked its presence among all premier management institutes in Pune by offering quality education and infrastructure. It believes in creating a workforce that is capable and always prepared to face any difficult scenario in prevalent in the corporate world.

We all are aware of the fluctuations the global economy is dealing with. In such an environment, the business world requires managers who will not only cut down risks and face challenges but also bring higher returns. To make this possible, IGBS has launched a two year management course named as Post Graduate Diploma in Management (PGDM). The main of this AICTE approved course is to help students learn the corporate work pattern and stay updated with the recent business trends that take over the market every other day. After all students can be exposed to the global business conditions only when they are keeping themselves abreast with all the latest trends.

Competition has increased and so has the complexities of the business world therefore the PGDM course covers topics such as basic business school essentials, global marketing and global finance. As one of the main highlights of this course, students have been given a chance to make structured oversea visit to business houses. It is meant for helping them get accustomed to the local culture over there so that they don’t find it difficult to gain work experience of international level. Through the Global CEO Club, students are offered a chance to interact with heads of global corporate companies. They are also exposed to the teachings of big names in the business world as they share their success stories with the students. Attention is paid to ensure that each student gets the perfect understanding of the factors required to become a global leader through case studies, lectures, management simulations, media projects, social responsibility projects and career development programs.

Developing International Management Skills

Some years ago I was working on a project for my company on how to develop international managers and I thought I would start by asking companies who had been doing it for years.

I went to Paris to meet with the French HR Director of a multinational oil exploration company and asked him what was the “secret” of building a truly international management group?

He told me “No secret, there are just 2 simple steps.

First – you recruit people around the world in proportion to your business, if 10% of your business is in Nigeria, 10% of your managers should be Nigerian .

Second – You mix them up. If they never leave their homes they never become international managers, send them on visits, expatriate assignments, put them in international teams and projects so they mix with their colleagues and learn.”

”What next” I asked

”Nothing” he replied “If you do these 2 things, in no more than 50 years you will have an international management group.”

It as still one of the best answers I ever got to my question – though my boss was not happy when I told him it could take 50 years!

His basic message was a good one – recruit for diversity to match your environment and build experience and common ways of working to get things done.

It takes time to develop a truly global mindset and management capability and, for companies relatively new to working internationally it can be a whole management generation before people with this capability work their way through to the top of the organization in sufficient numbers to really make a difference.

I think we can accelerate the process with the right international management training and exposure to international experiences – but a lot of management training continues to carry a very mono-cultural view of the world (usually Anglo-Saxon management theories.

What is different about international management – we talk about DCCT – distance, cultures, timezones and technology

National cultural differences are often the first thing that people notice but rarely the toughest one to solve, with the right mindset we can learn to enjoy and manage cultural differences quite quickly.

Distance is a bigger barrier – people are much more comfortable with face-to-face contact and the lack of this can have major consequences for trust and management styles

Timezones are a fact – there is no right time for a global conference call, we just have to be aware and adapt our practices to recognize this.

Technology is both an enabler and a barrier; it makes international management possible but can often get in the way of communication and effectiveness (think of all those unnecessary emails and conference calls).

An additional barrier is the sheer business complexity of large multi-site organizations – the subject of my book Speed Lead – faster, simper ways to manage people, projects and teams in complex companies

When we talk to managers about developing these skills they are often skeptical about the investment of time in training. When we ask them how they learned to work internationally they often tell long stories of the mistakes they made and the time it took to recover and put things right.

Our question is always – can you afford the time and cost of letting everyone in your organization learn by expensive trial and error?

International Business: Strategy, Management, and the New Realities

International Business: Strategy, Management, and the New Realities

KEY BENEFIT: CKR is an evolving learning package that makes teaching easier and captures IB as practiced today.
The text addresses emerging markets, the growing participation of small and medium-sized firms in international business, and examples of both international and national businesses so students can see IB from all perspectives. CKR also offers an online resource called the Educator’s Consortium that supports and connects students and instructors worldwide.

This text is for business students and professionals interested in learning about the impact of international business and emerging markets.


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