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AMITY INTERNATIONAL BUSINESS SCHOOL

Dr. Namrata Pancholi Vinayak


MBA Sem- I
Introduction to Global Business Management

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Learning Objectives
To discuss the Changing Business Environment
Role of Globalization and Changing work places of
today
Role of Global Events and Activities in governing the
economy of a country
To learn the principles, guidelines and practices of
Global Business Management.
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Students should be able to learn and


Understand the Impact of Globalization on
Governments, Businesses and Consumers.
They should be able to trace the evolution of the
International geo-political and economic system
Appraise the role of International Institutions and
Regional Integration in International Business
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Changing Business Environment


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1.Liberalisation
2.Privatisation
3.Globalisation
4.Technology
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globalization must be taken for granted.


There will be only one standard for corporate
success: international market share. Winning
corporations will win by finding markets all
over the world.
-Jack Welch
CEO, GE

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20TH Century

21st Century

Internal organizational focus Focus on comptitive


environ ment
Domestic market orientation International focus
,collaborative advantage
Hyper-comptition, constant
Competitive advantage
re-invention of advantage
Sustainable competitive
advantage
Competing for todays

markets

Creating tomorrows market

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Technology and Work Places


-Virtual Management
Challenges of keeping employee accountability and
motivation
-IT Industry
a. IT Services
b. BPO
Contribution to GDP is 7.5% FY2013
8.5% by 2020
10% of total FDI funding in India.

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Traditional Role

Transformational Role

Back Office and


Cost Cutting

Business Partner Role

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BPO Industry
-Presence in 70 countries
-75% of Fortune 500 companies as clients
-$101billion industry today
-$310 billion by 2020
-employment of 2.8 millions directly
-11.7 millions indirect.
-Transforming public services---- UID
-Transforming Agri, local farmers, weather forecasting
etc.

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Indian Economy
1.In the past years, the Indian rupee has been loosing
momentum continuously .
2. While a weak rupee may be good for certain sectors,
it certainly is bad for the Indian economy on the
whole.
3. The rupee-dollar exchange rate ?
4. Rupee depreciation is making
a. Imports expensive
b. Not helping exports because of global economic
slow down.

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To some extent, depreciation can be good for


the economy as this will help to increase our
export competitiveness and discourage
imports.
There are many sectors which are regaining
competitiveness in export markets as a result
of the fall in the exchange rate.
(Source: Business

Standard.Dec.2013)

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The three key risks arising from longer duration


slowdown would be :
a. the sharp rise in non-performing assets in banking
system,
b. challenges in managing fiscal deficit and
c. the external funding risks would remain high.
PM Address

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FACTORS AFFECTING THE RUPEE


MOVEMENT

1. Fiscal deficit of a country is an important


factor that drives the currency of that nation .
a. Huge import of gold
b. Rise in prices of crude oil
c. And recently of coal

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Import of Gold:
-Demand for yr.2013 ----950 tonnes.
Import is only 400 tonnes
Rest through smuggling.

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2.Dollar Demand-Supply
Rising oil prices mean more dollars are
required by Indian oil companies to import
crude oil since oil price is quoted in the US
dollar in the international market.

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FACTORS AFFECTING THE RUPEE MOVEMENT


cont.
3. Global Factors
----War in Iraq
The crisis in the Euro zone triggered
- political uncertainty in Greece and current debt crisis
- the election results in France and Germany are pointing towards
negative sentiments for austerity measures taken by the
government.
- Overall, there may be more bad news coming from the Euro
zone. Hence, the dollar is getting stronger against other
currencies, including the rupee
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G -20 committed to fight the global slowdown and


achieve global economic stability, sustainable growth
Next meeting in Brisbane in November 2014 under
the Australian Presidency

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The6th BRICS summit held in Brazil.


Fortaleza, the northeastern coastal city of Brazil

He will be meeting leaders from the four nations


and it is expected that the blueprint for a
development bank and reforms of United
Nations and international financial
organizations.

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Why go global

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International Business
- Comprises a large and growing portion of the worlds total
business.
- Today, global events and competition affect almost all
companies.
- Not all companies operate globally but cannot avoid pressures
from around the world.
-SMES contribute to 95% of business in Asia Pacific region , 4050% of trade activities.
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Factors for growth in International Markets

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Profit
PLC Stage
Competition
Excess Capacity
Geographic Diversification
Increase in Market Size
ICT and transportation facilities
Income Growth
Lower trade barriers
Desire for new products(consumes) and new
markets(marketers)
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IPLC Concept

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Innovation
Overseas Innovation
Maturity
World-wide imitation
Decline
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Evolution of International
Business

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Domestic market extension Ethnocentric


Multi-domestic market Polycentric
Global marketing Regiocentric /
Geocentric
Transnational marketing Mixed

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Domestic Marketing

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Market Focus

Domestic

Orientation

Ethnocentric

Marketing Mix Decisions

Focused on Domestic
Customers

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Export Marketing
Market Focus

Market Focus

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Overseas (Targeting and Entering


Foreign Markets)

Orientation

Ethnocentric

Marketing Mix Decisions

Focused on Domestic Customers


Overseas Marketing-Generally
extension of Domestic Marketing
Decisions made at Headquarters

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International Marketing

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Market Focus

Caters to specific needs of a


few overseas market

Orientation

Polycentric Orientation

Marketing Mix Decisions

Products manufactured in home


country with separate product
adaptations for different markets
Product Decisions made by
individual subsidiaries
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Multinational Marketing

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Market Focus

Consolidation of operations on
regional basis
Gains from Economies of Scale

Orientation

Regiocentric

Marketing Mix Decisions

Product Standardization within


regions but not beyond them
On regional basis

Market Focus

Domestic

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Geocentric

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Market Focus

Consolidating firms operations on


Global Basis

Orientation

Geocentric

Marketing Mix Decisions

Globalization of marketing mix


decisions with local variations
Joint decision making across firms
global operations
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Thank You

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