Forces in International Business

Has its march ons in galore(postnominal) multinational harvesting manufacturing. They do atomic number 18 effected on a daily basis by the diametrical forces of foreign trans reach and honest unwraps. These forces were assembled, and one of their ethical issues were evaluated. Forces in global traffic sector at that place argon multiple forces that effect transnational lineage.These forces ar calculators forces, natural choices and purlieual sustainability, policy-making and craft forces, adroit office and former(a) wakeless forces, the international and monetary system and financial forces. All of these forces ar things that capture Samsung Co. On a daily basis. Along with these forces, Samsung is withal tasked by ethical issues that come imposed on almost e rattling international artless. These forces are around of the founding forces that international businesses are built on and effected by on a daily basis.Calculators Forces The low gear of the forc es c each(prenominal) all overed is the calculators force. In hostel to derive what Calculators Forces are, we must netherstand what calculators is. The Merriam-Webster dictionary describes calculators as a combination of social and ultra factors. (Calculators. Merriam-Webster. ) Dictionary. Com defines it as, the combination or interaction of social and cultural factors. (Calculators. Dictionary. Com) From these two definitions social and cultural are the two big factors. are hundreds of antithetical ways to define nicety, and its a very broad term.The book, International Business, lays d proclaim virtually veracious fundamentals about what nuance is. The first drumhead that International Business says about culture, is that it is learned, and not born(p) with. This means that Just be deliver youre born somewhere, soonest necessarily mean you will adapt to the culture, precisely expense a lot of age around state who are immersed in the culture will entrust you t o adapt to it. This post be a major(ip)(ip) benefit or drawback. It does allow people to break away to saucily theater of operationss of the world and even outtually adapt to their culture, but it rouse portion out a lot of time and energy.The second point is that different separate of culture are interrelated. This second is more of a pellucid relation of culture, its basically defining that you cleart nourish some parts of culture without others. The third gear major point that is outlined is that culture s shared, patterned and mutually constructed by means of social interactions. (Ball, Donald). This point is very interesting, and what defines culture. passim the world we see many different cultures, diverged by religion, and regions, and we git see how some cultures have greatly impacted other parts of the world and their culture.Because culture is shared through social interactions, we can actually start to see a lot blending of cultures through the internet. Through the member Blending Cultures via data processor in The International Journal of New Media, it discusses the lending of European art and culture blending into parts of Chinese Contemporary artists. Without the social interactions through online sources, this is something that would have never been possible. The give out major point that is make by International Business, is that culture defines the boundaries of different groups.An example made in that book is how the Statesns are clock-watchers. A lot of cultures dont follow a similar pattern, and it makes Americans seem to always be in a rush. This makes them permit on unfriendly, arrogant, and untrustworthy, because its not something thats globularly accepted. Another interesting point on this topic is how culture varies so a good deal even within a single country itself, and can even vary in gradient lilliputian field of operationss. The best example of this that is very well known, is how people in the younger g eneration from the bay area in California are known for saying hell.This is something thats only sprung up within the last few years, but is very common in that culture, and saying it outside of even the bay area of California allows people to bound where youre from very quickly. A considerable part of socio-cultural is the constantly changing of customers preference. Samsung was fitted to capitalize on one of these variety shows not too long ago, and was up to(p) to help turn the yell industry upside down. Before 2007 Monika was the king of the cellular industry, and had complete market dominance, until apple stepped on the medical prognosis which completely changed the audio market.They added in a whole sensitive experience to the phone market. The hysteria touch the phone made Samsung sit up and take notice( Bandit, Rural) Samsung had a share in the phone market, and capitalized on the trend that apple started. They were able to acquire a contract with Googles run sys tem, android. Monika ref apply to adapt to the trend, and Samsung was able to take the leap and Jump ahead of Monika in 2011 as the elephantinest market share of mobile devices.The article How Does Socio-cultural Environment Impact a Business sums up Samsung success greatly, Samsung, the minnow when Monika was the shark, is now the outstandingst hand rophy grader in the world, and in the process, has outdone Apples phone, which many consider to be the innovation on which most modern luminousness are modeled. (Bandit, Rural) congenital Resources and Environmental Sustainability. The second major force is natural resources and environmental sustainability. This force can be split into the two different sections of natural resources, and environmental sustainability.Along with those two different sections there is geographics which plays a semi-significant part on this force, and also Porters Diamond to help analyze competitive advantage. Geography has a lot of possible effec ts on a soaring society. Google gives a great definition of geography, stating that its the study of the visible features of the earth and its atmosphere, and of tender activity as it affects and is affected by these, including the distribution of populations and resources, knowledge base use, and industries. (Natural Resources Google Search) Geography is very broad, and covers everything from topography of a region to climate.These things can have a large impact on how a country defines itself. Mountains can separate a entire section of a country from the rest, thus leading them to having perspicuous cultures, industries and climate. It can even lead to boundaries such as deserts or forests that act as barriers in the midst of two separate regions. (Ball, Donald) These barriers cause different needs base on the area, even though they may simply be in the same country. Porters Diamond helps analyze businesses based on four aspects of a countrys scotch environment.The fou r conditions the assessment is based off of are factor conditions related and supporting industries regard conditions and firm strategy, structure, and rivalry. Porters Diamond from assess the business with a high emphasis on the countries geographical attributes as a core part of its factors, and those with the most favorable diamonds are freeing to be the most successful. (Ball, Donald) ( Michael E. Porter) Natural Resources play a huge factor into the economic viability of a company, and owe and where a company can be successful.Google does well defining natural resources as materials or substances such as minerals, forests, body of water, and fertile land that occur in nature and can be use for economic gain. (Non- renewable Resource. Wisped) In the book, International Business it puts a lot of emphasis on the statement that natural resources are anything thats supplied by nature which people depend on. This book also relates that both energy and unfelt minerals play an imp ortant role to business. Energy is used daily without a though, but is a very valuable natural resource, if not the most valuable..There are two major types of energy, renewable, and nonrenewable. A non renewable energy resource is a resource that does not renew itself at a sufficient rate for sustainable economic extraction in meaningful human time-frames. ( Renewable Energy. Wisped) nearly examples of nonrenewable energy resources are petroleum, coal, and natural gas. A renewable energy resource generally defined as energy that comes from resources which are naturally replenished on a human timescale. (8) close to examples of renewable energy resources sunlight, wind, rain, waves, and geothermal heat.Environmental Sustainability in business has three characteristics that are widely agreed upon limits, interdependence, and equity. (Ball, Donald) The first of these three characteristics is limits. Limits is a basic term to serve as a reminder on the realness that environment re sources are exhaustible, and that they can become toxic. The previous trend of global warming or global climate change is a great example of a limit, and how its macrocosm impacted. The second characteristic is interdependence. interdependency is defined as the relationship between ecological, social, and economic systems. Ball, Donald). This book goes on to define that an effect in one these systems will affect the other two. The last characteristic is equity. Equity is basically applying limits to interdependence. In order of Interdependence to work, there cannot be large differences in the distribution gains. This essentially means that it isnt viable to go into an area and take extreme profits without eventual resistance. Samsung is a company that takes its social responsibility, environmental responsibility, and sustainability fantastically seriously.In 2013 Samsung released its 2 page sustainability report, regarding topics such as Creating Shared Value and Giving Back with Samsung Products, Social duty Making Contributions around the Globe, Echo Product, Water Management, and a 50 page green/echo product environmental report (Samsung worldwide Harmony. Www. Samsung. Com) Directly from Samsung engineering website, this is their vision, Samsung Engineering seeks to improve conditions around the world through our social contribution programs.Company-wide, we utilize our strengths and resources to benefit local communities and help children and families in need. Individually, our employees are encouraged to take part in the many volunteer programs offered by the company. Since 2006 Samsung has been trying to enhance their energy efficiency, and respectability in their production. Theyve even implemented a Echo-Design Process to evaluate the echo-friendless of apiece new product during the development stage. . In 2012, the company set up comprehensive water conservation plans and expanded its efforts to reduce the consumption of water resources aro und the world. (Samsung Global Harmony. Www. Samsung. Com) Samsung has not interpreted being a leader in lobar applied science lightly, theyre fully applying a lot pressure to help with the sustainability of their resources, and other resources around the globe. Helping many charities and different organizations to try to help sustain our planet and keep their business profitable. Political and slyness Forces Political and foxiness forces are Just as important in any country as its culture and environment. This is because of the major impacts that political sciences can have on firms.A hospitable and stable government can encourage investment and festering despite geographic or weather barriers, or even the scarcity of natural resources. The exact arctic is true as well. A hostile or unstable government can completely push down of almost any possible investments in an area, regardless of the areas natural resources of geography. Some of the major points in the political and trade forces are government stability, and trade restrictions. political science stability can have a huge impact on business.When government stability is defined, there are two different possible definitions. Government stability can be defined as the governments ability to maintain itself and stay in power, or it can be defined as the permanence of the governments policies. Ball, Donald) A business is able to be at its most prosperous when the government is able to keep both of these definitions intact. Instability on the other hand is when a government cannot maintain itself in power or makes sudden, unpredictable, or radical policy changes.It is troublesome for business to flourish when government is unstable. (Ball, Donald) Business can operate under almost any set of rules and restrictions, though some are much more difficult to operate under than others. The biggest issue is when government policies are constantly changing. The reason this is difficult is cause frequent cha nges cause business difficulties when complying to rules and regulations. This can cause business to have to change their business models or how they operate almost overnight. With changing policies it can potentially grind some firms too halt.Trade restrictions can be one of the biggest problems when operating an international firm. There are a lot of arguments for trade restrictions such as national defense, sanctions to punish offending nations, protect infant industry, protect domestic Jobs from cheap foreign savvy, scientific tariff or fair competition, retaliation, dumping and subsidies. Some of these have a much higher impact than others, but all of these are great arguments towards trade restriction. One of the best of these arguments stems from developing nations requesting barriers on imports of competing products.This allows the developing country to sustain itself and build up its on infrastructure while developing products that might be common place elsewhere. The arg ument is that a new industry needs time develop and gain experience before being forced to manage with worldwide competition. Another good argument is the national defense argument. This argument basically requests hat there are trade restrictions on certain industry imports, and that theyre vital for security, and must be kept operating even though they are not competitive with the foreign suppliers. Ball, Donald) The reason for these vital industries are so that during times of immediate war a country wouldnt suffer from excess problems because theyre not able to have the proper defense equipment. This could range from guns and tanks, to as simple as shoes. Having an insufficient supply of footwear at times of war can cause a lack of shoes for civilians and soldiers which can lead to unnecessary casualties. These trade restrictions arguments all raise their own valid points and each have their own benefits and negativisms.Ever since the introduction of Samsung ingenuity they ha ve been in sanctioned battles all over the world with Apple trying to make it court-ordered for them to sell their phones, and not be infringing on copy right law of natures. Almost every country has had their own legal battle with Samsung and apple with new ones emerging every day. With Samsung being based on southernmost Korea they were able to have a lot of political influence there. In the article , Korea Fair Trade Commission clears Samsung use of tankard-essential patents against Apple, it refers to how Samsung used its power in Korea to basically influence these decisions.With Samsung being a big part of Koreans market they were able to get their essentials patents against Apple cleared allowing them to continue operation as usual. (SAMSUNG ENGINEERING. Samsung Engineering) knowing Property and Other effective Forces The fourth of the international environmental forces is noetic property and other legal forces. The best way to sum up this section is given by, Interna tional Business, saying International business is affected by many thousands of laws and isolations issued by states, nations, and international organizations. The reason this is a really outstanding abridgment is because not only are international businesses subject to the laws of the countries they operate in, but also the states and even cities they are based in. The other few main points of this section include international legal forces, international argufy settlement, and intellectual property. International legal forces are governed by international laws. International laws can be divided into two subcategories, public international law and hush-hush international law.Public international law can be defined as the relations between governments, including laws concerning diplomatic relations and all matters and obligations of those nations. (Ball, Donald) Private international law are the laws concerning the transactions of individuals and companies crossing international borders. (Private International Law. U. S. Department of State) International laws come from some(prenominal) different sources, but the main and most important of these are treaties between nations. Ball, Donald) A treaty is basically an agreement under international law, and can also be known as an agreement, protocol, covenant, invention, pact, or turn of letters, and all of these forms of agreements are, under international law, equally considered treaties and the rules are the same (Treaty. Wisped) Some International organizations have been make outd to entrust a forum to help create treaties between different countries. A few examples of these would the United Nations or the European Union.Handling international laws are great, but without being able to enforce them they lead nowhere, this is where international divergence settlement comes in. Litigation is the process conducted in order to determine and enforce legal rights, this is essentially the investigation proces s behind laws such as international treaties. This process can be incredibly heterogeneous and expensive, and in addition to the trial itself the process can require a pretrial. A pretrial is essentially an pre investigation which requires all facts and relevant information to the litigation from both sides to come forth. Ball, Donald) The other part of international dispute settlement is arbitration. Arbitration is a process agreed to by both parties that instead of going to court, they will attend a neutral person or party the makes a binding decision. Legal Dictionary gives a great summary of arbitration, saying Arbitration is a well- established and widely used means to end disputes. It is one of several kinds of Alternative Dispute Resolution, which provide parties to a controversy with a choice other than litigation.Unlike litigation, arbitration takes place out of court the two sides select an impartial third party, known as an arbitrator agree in advance to comply with the arbitrators award and then introduce in a hearing at which both sides can present evidence and testimony. The arbitrators decision is commonly final, and courts rarely reexamine it. (10) Intellectual property encompasses many different exclusive manufacturing rights. These are patents, trademarks, trade names, copyrights, each which have their own separate meaning and purpose.A patent in the United States is defined as, an intellectual property right granted by the Government of the United States of America to an inventor to exclude others from making, using, offering for sale, or selling the invention throughout the United States or importing the invention into the United States for a contain time in exchange for public disclosure of the invention when the patent is granted. (11) A trademark or trade name can be defined as, A shape, a color, design, catchy phrase, abbreviation, or vowelise used by merchants or manufacturers to designate and differentiate their products. (Ball, Donald) A copy right is, Exclusive legal rights of designers, composers, creators of software, playwrights, artists, and publishers to publish and dispose of their works and are protected under the Berne Convention of 1886 which is adhered to by 164 countries. (Ball, Donald) possibly one of the biggest legal battles regarding intellectual property in history is a battle still being fought today. That battle is Apple Inc v. Samsung Electronics Co. These cases are strictly regarding the design of smartness and tablets.The spring of 2011 apple began litigation over several patent infringements by Samsung. (United States District Court) Eventually the litigation opened up to 19 different cases spanning across ten different countries. (Liableness, Chloe) A basic summary of this case is that apple patented the shape of its phone and the color design and layout of its SO right before the release of the first Phone in 2007. In 2011 Apple opened up some cases against Samsung referring to Samsung breaking patents, trademarks, ND the use of its style over multiple devices. (Apple Inc. . Samsung Electronics Co. , Ltd. Wisped. ) After a few months in dispute apple submitted evidence of side by side comparison between an phone and a specific galaxy model. This evidence sour out to be tampered with which lead to even further investigation. (Liableness, Chloe) Since the cases were opened, there have been multiple trials and appeals. This has lead to some countries fully banning Samsung products, and countries punishing Apple forcing them to essentially pay to Samsung for slandering their name. (Apple Inc. V. Samsung Electronics Co. , Ltd. Wisped. ) International Monetary Arrangements and terrorism International monetary system and terrorism have a large impact on how some international businesses are able to operate. One of the major factors in the international monetary system is international Exchange. The reason why this is a large factory is because most corporation s like to do business in their own property, because then they dont have to assume the risk that can come with specie exchange. (Ball, Donald). This is prevalent because it can cause major problems when converting to other currencies.Samsung being one of the world largest manufacturers and suppliers of electronics faces themselves working with many different currency on a daily basis. Being the largest Smartened supplier in the world they deal with a large amount of exchanges. This is because some of their phone parts are produced in different nations, and then sold in almost of every country around the world. Ethical Issue One of the belike the biggest ethical issues go about before Samsung is the entire child labor debacle in 2012. In 2012 Samsung was investigated for using illegal labor practices in their Chinese manufacturing facilities.The claims against Samsung were that in some cases were that employees were working 16 hour days, and also that some employees were under th e legal working age of 16 years old. (windcheaters. Com) After the investigations were complete Samsung was found guilty of these practices, but that they were not the ones responsible for these practices. They were able to essentially cover their tracks in these cases and switch a majority of the blame. (Grandson, Odin) Samsung probably didnt portray Christian values in this situation, as they were not respecting the laws in that country.This is finitely a large issue in the manufacturing process, as it is able to provide cheap labor for their company. Conclusion Samsung is an international company that is effected by the different international force of business on a daily basis. These forces determine everything from where and when to sell products, how to ship, where to manufacture a long with a multitude of other things. Samsung is also faced with ethical issues. Through the thick and thin Samsung has been able to use these forces to put themselves at the head of the pack go a leader in international electronic manufacturing.Forces in International BusinessIntroduction McDonalds is a corporation from the United States that has done a great deal of business internationally for many years, and is well-known globally. McDonalds is listed at number 378 on Fortunes Global 500 list, and brought in over $22 billion in revenues in 2010. Sociocultural Forces Sociocultural forces include the different aspects of grounds that exist in one culture in comparison to another(prenominal). These aspects include aesthetics, religion, language, education, etc.It is important to remember that culture is not something that is innate to specific persons, but is rather something that is learned through experiencing the culture. Along those lines, culture is also shared between all of the members of the culture, and all aspects of it are interrelated. In fact, group boundaries are caused by culture and set persons feeling towards different actions. The imagination that ones o wn culture is better than another is called ethnocentrism. Natural Resources and Environmental SustainabilityThe second force encompasses natural resources and environmental sustainability. Natural resources are based upon reparation within the world and advantages that these resources give a nation relative to the rest of the world. Some of these resources are limited, and over time if taken into account can become depleted or cause harm to the environment in another way. The concern for the sustainability of these resources should be of some concern to businesses operating internationally because it affects their decisions and the decisions of those they are negotiating with as well.Economic and Socioeconomic Forces Economic and socioeconomic forces also play parts as forces that affect different countries. The economic forces include different levels of economic development including developed, developing, and newly industrialized countries/economies. Socioeconomics affect the e conomies of different countries and regions individually based on their own social norms. Power levels can be defined by the strength of the deliverance that either a country or a business has as well.This concept is also intertwined with the concept of exchange rates. Political Forces Political forces affect countries and businesses as well. Some political forces include nationalism, national or international conflicts, international organizations, and types of governments such as communism, socialism, and capitalism. Whether a country is conservative or liberal can also play a part in the politics of a region. Political forces spill into the international legal system too which makes them of great concern to businesses.A major part of political forces in regards to business is trade restrictions or tariffs which cost the business more money to export or boycott their business altogether. Intellectual Property and Other Legal Forces International business can be influenced by conc epts of intellectual property and other legal forces as well. One major legal force that can influence a businesss decisions is international law. International law is divided into both public and private laws. Public international law revolves around relations between governments including the rights and obligations of sovereign nations.Private international law lords over the transactions made by individuals and companies in regards to international borders. Intellectual property comes from a person or companys intellect, and these ideas are protected by laws which include the use of patents, trademarks, copyrights, and trade secrets. Financial Forces and the International Monetary System Financial forces including the international monetary system which contains financial institutions, agreements, rules, and processes play a major part in the decisions that businesses make in regards to international markets.The value of a countrys currency as well as the exchange rates relative to either their floating currency or their being on the gold standard is a huge factor to consider as a business negotiating across borders. Most businesses will hedge their investments in order to protect themselves from losing money imputable to constantly changing rates of exchange. Labor Forces Finally, the seventh force affecting international business has to do with labor. Classifications such as size and average age of a workforce, as well s unemployment rates, all affect the manner in which an international business reacts to its current and potential workforce. A major issue making its mark on the global economy right now is brain drain, which causes the skilled workers of a developing country to migrate for greater professional and economic reasons. All of these forces must be taken into account when involved internationally as business. McDonalds Cultural Forces In the book Golden Arches East, the author discusses how when McDonalds moved their business into the Far East, they were forced to reevaluate the culture there.In Japan especially, the idea that America exists in a class of its own is a type of fantasy that prevails in the fondest thoughts of those who consider it. For Japan, McDonalds is a symbol of this fantastic culture, and brings in many customers because of this (especially from the younger population). From the perspective of the civilizing process McDonaldshashelped to create an entirely new concept of manners. (p. 181) says Watson (1997). Through the introduction of fast food into the culture, McDonalds has introduced an entirely new concept of manners to this culture.The book also discusses how the high amount of rice in the diet there also affected their business decisions. Watson (1997) states, McDonalds has gained ample recognition among Japanese consumers. However, our image is that of a light-meal eatery for young people. We are not regarded as a place for adults to have dinner. (p. 164) McDonalds is not a fast-food restaur ant there as it is in the US, but rather a trendy place to get a snack. McDonalds and the Environment McDonalds Economic ForcesWages paid to citizens of European countries have a high ratio of variability, and therefore McDonalds had to adjust their pricing and payment strategies when they entered the European market. (Royle, 2000, p. 158). Royle states, Unions in Germany had to accept the possibility of even lower wage (p. 158). In addition, executives in many European countries were hired for just a fistful of dollars (Royle, 2000, p. 165). The pricing systems for their menus had to be adjusted based on the expectations that the economy had for them as well.This caused a serious change which McDonalds had to adjust to in order to achieve success in this new environment (Royle, 2000, p. 167-169). McDonalds Political Forces Politics also holds a great deal of power over wages paid in each country McDonalds moves its business into. Royle talks about different wages that are require d by governments in European countries, for example, in addition to the basic Danish kroner per hour, workers receive an supernumerary DKr 9. 15 per hour for any hours worked during Monday to Friday between 600 p. m. nd midnight (p. 163). There are several other stipulations on payment that are made by law that Royle lists throughout the rest of the chapter. In addition, McDonalds is constantly under fire from several interest groups who are trying to make sure that McDonalds uses humanely raised and slaughtered animals from suppliers that have shown concern about this. This is another political pressure that concerns McDonalds as they attempt to meet the cultural standards for the ethical treatment of animals. McDonalds Legal Forces McDonalds Financial ForcesMcDonalds Labor Forces McDonalds has a massive workforce worldwide which it uses to expand and maintain its numerous international ventures. hamburger University is a training program used specifically to train new leaders fo r the McDonalds workforce. At a location in Shanghai, mainland China, admission is a competitive opportunity. More than 26 percent of Chinas 6. 3 million college graduates were unemployed as of July 1 (Wei, 2011), this means that McDonalds is able to exact who they want to apprentice at Hamburger University.McDonalds hopes to grow from 1,300 stores to 2,000 in China by 2013 (Wei, 2011), and Hamburger University will be a major part of meeting the labor requirements for that goal. References Adams, C. (2007). Reframing the Obesity Debate McDonalds Role May Surprise You. Journal of Law, Business, & Ethics, 35(1), 154-157. doi 10. 1111/j. 1748-720X. 2007. 00120. x Ball, D. , Geringer, M. , Minor, M. , & McNett, J. (2009). International Business The Challenge of Global Competition. New York McGraw-Hill/Irwin. Royle, T. (2000). Working for McDonalds in Europe Unequal Struggle?.London Routledge. Watson, J. L. (1997). Golden Arches East McDonalds in East Asia. Palo Alto Stanford Universit y Press. Wei, M. (2011). Hamburger University Shanghai is Sizzling. Business Week. 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