This segment, which was introduced in semester 2, 2008, will provide candidates with an understanding of the concepts, practice and real-world knowledge necessary to conduct business in an international environment taking into consideration the impact of various forces that influence the global business environment.
The segment will draw on case studies and articles and will include topic areas such as how to manage across cultures, how to conduct business internationally and how to deal with accounting and finance issues in an ever expanding global business environment.
Module 1: The international business context
why is business going global?
what is globalisation?
definition of international business
definition of globalisation
drivers of globalisation
competitive factors
technological factors
social factors
political factors
globalisation and localisation
the benefits of globalisation
the value of localisation
limits of globalisation
the evolution of international business
the history of international business
the evolution of multinationals
the globalising economy
the changing composition of international trade
the contemporary pattern of world trade
dimensions of globalisation
levels of globalisation
the challenges of globalisation
global risk
country risk assessment
financial risks
economic integration among countries
levels of economic integration
the role of international institutions: The WTO, IMF and the World Bank
the functions and benefits of international institutions
problems with international institutions
the global financial system
the international monetary system and balance of payments
current account
capital account
official reserves account
exchange rate mechanisms
the growth of global financial markets
the financialisation of the international economy
international trade theory
mercantilism
classical trade theory
factor endowment theory
international product life cycle
international investment theory
classical theory of international investment
extensions of classical theory
barriers to trade
types of trade barrier
Module 2: The global business environment
international environment
economic environment
economic systems
a market economy
a centrally planned, planned or command economy
a mixed economy
classifying countries
developed countries
newly industrialised countries (NIC)
developing countries
economic transition
economic risk
managing risk
the Asian crisis
political environment
international politics and international economics
political relations and international trade
types of political systems
politics is not all international
political risks
categories of political risk
the political risk components
host country political risk
examples of political risk
expropriation
confiscation
strategies for managing political risk
risk insurance
business: government relationships
legal environment
effects of national laws on international business
legal systems
basic principles of international law
organisations shaping global policies
Organisation for Economic Co-operation and Development
United Nations
framework for resolving international business disputes
intellectual property
other factors impacting the international environment
ethics
ethical versus legal behaviour
technology
telecommunications
e-business
Module 3: Managing across cultures
defining culture and subculture
ethnocentrism and stereotyping
managers in international business
expatriation and culture shock
subculture, repatriation and reverse culture shocks
culture classification studies
Hofstede's cultural dimensions
power distance
individualism vs collectivism
masculinity vs femininity
uncertainty avoidance
long-term versus short-term orientation
application of Hofstede's study
criticism of Hofstede's study
Trompenaars' value dimensions
universalism vs particularism
individualism vs communitarianism
neutral vs emotional
specific vs diffuse
achievement versus ascription
attitude to time
attitudes to environment
the GLOBE study
performance orientation
future orientation
assertiveness
humane orientation
cross-cultural communication
the communication process
verbal communication
non-verbal communication
kinesics
vocal qualities
proxemics
object language
other environmental factors
time
context
international business negotiations
stages of international business negotiations
pre-negotiation
face-to-face negotiation
post-negotiation
factors influencing international business negotiations
cultural factors
environmental factors
conflict in negotiations
Module 4: Principles of international business strategy
international business drivers
stages of international business
theoretical models of internationalisation
decision-making models
learning and innovation models
tnternationalisation as a strategy process
ethnocentric
polycentric
regiocentric
geocentric
generic strategies
economies of scale
economies of scope
factor costs
low-cost labour
porters model of competitive strategy
external assessment
bargaining power of buyers
bargaining power of suppliers
threat of new entrants
threat of substitutes
rivalry among existing competitors
basic strategies
cost strategy
differentiation strategy
focus strategy
internal assessment
resources and capability
value chain analysis
national competitive advantage
from comparative advantage to competitive advantage
determinants of national competitive advantage
innovation and regional clusters
further evolution of international companies
international
multinational
global
transnational
the transition to transnationality
sectoral strategies
globalisation in science-based industries
globalisation in scale-intensive industries
globalisation in resource-intensive industries
globalisation in labour intensive industries
commoditisation
service companies
intellectual property
the knowledge wealth of nations
offshoring and outsourcing
services offshoring
offshore outsourcing of information technology services
multi-location offshore sourcing
product strategies
global branding strategy
global pricing
structures and strategies of MNCs
the varieties of multinational company structures
organization forms with simple structures
more complex co-ordination and control structures
measurement and performance
Module 5: International business strategy: market analysis
analysis of international markets
service companies
analysing industry and country attractiveness
country risk analysis
diversification versus concentration
reinvestment versus harvesting
key international markets
the Triad: North America, Western Europe and East Asia
BRICs: Brazil, India, Russia and China
doing business
entering Asian markets
raising technical standards and new sectoral opportunities
modes of entry
strategic objectives of market entry
timing of entry
comparison of modes of entry
exports
licensing
franchising
joint ventures
wholly owned foreign enterprises
comparison of entry modes
getting in
entry mode and location of production
innovation strategies in emerging Asian markets
alliances and acquisitions
strategic alliances
globally leveraging advantage
the range of inter-firm links
global competition
making global alliances work
global mergers and acquisitions
conditions for M&A success
the value of mergers and acquisitions
sovereign wealth funds
Module 6: Conducting international business
international business: reasons and risks
reasons to consider an international expansion
sales: growth through expanded sales into an untapped market
supply: new sources of supply
discovery
defence strategy
key questions to ask
why?
risks vs benefits of an international expansion
benefits vs risks of not doing it: can you afford not to do it?
international expansion issues and strategies
sales and marketing
manufacturing
outsourcing versus offshoring
incentives regarding location
intellectual property issues
differing occupational health and safety standards
supply chain management
goods into the supply chain (i.e. purchase chain)
goods out of the supply chain (i.e. sales chain)
control systems and processes (including ownership)
human Resources
finance
international business: the role of the CFO
understanding the business
possible phases of an international expansion
direct sell / purchase
distributor
subsidiary operation
possible alternative legal structures and vehicles
general risks and considerations for foreign operations
foreign exchange
differing ways of doing business
communication issues
portability of the business model
Module 7: Accounting and finance issues in international business
awareness and management of international accounting issues
international taxation
tariffs
free trade agreements
incorporating tariffs in decision making
anti-dumping provisions
corporate tax systems
determination of corporate profits
tax levied on corporate profits
foreign-source income
tax incentives and tax havens
transfer prices
international trade finance
international receivables management
documentary collections
bills of exchange
letters of credit
types of LCs
international accounting regulations and reform
the role of accounting standards
International Financial Reporting Standards (IFRS)
IFRS coverage
IFRS implementation
Generally Accepted Accounting Principles (GAAP)
comparing IFRS and GAAP
US Sarbanes–Oxley Act (2002)
auditing standards
international corporate governance
voluntary disclosures
international accounting and regulatory bodies
international financing and treasury activities
government assistance
risk management
insurance
foreign exchange
currency controls and repatriation of profits
Note: at the time of publishing the study materials for this segment were still being finalised. As a result, some changes to content may have occurred since we published the content outline.
