THE LANDSCAPE OF GLOBAL BUSINESS Chapter 4 Lecture 1.
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Transcript of THE LANDSCAPE OF GLOBAL BUSINESS Chapter 4 Lecture 1.
THE LANDSCAPE OF GLOBAL BUSINESS
Chapter 4 Lecture 1
Why are Global Businesses Important to Us:
Economy is about $40 trillion 2003 Snapshot of the Global 500
– $13.729 trillion in revenues Businesses will employ many of you You doubtless want to work for a
“good” business
What are Business Categories of Global
Enterprises? Global Giants
– Public ownership– Private ownership
Small to medium size firms– Family owned– Public ownership– Global Start-ups
(Other global enterprises include global nongovernmental organizations, intergovernmental organizations, and global gangs or terrorist groups)
Global Giants Global Brand giants—can be public or private, but due to
brand awareness, they usually are fairly well monitored by the press– These are many of the firms we are studying—check
Interbrand or AC Nielsen for ratings– Usually are from advanced economies, but developing
economies are trying to buy or build global brands, e.g., Haier
Hidden giants—companies whose activities are not in the public eye, e.g., cement, building materials, insurance companies, food production, machinery—we also study these because life is not all brand glamour– Some are not in the public eye because we don’t care– Some are not in the public eye because the parent company
does not want us to know Ben and Jerry’s is owned by Unilever Coca-Cola owns Odwalla General Mills owns Small Planet Foods
Note Note from from SAGE: is SAGE: is this this image image integral?integral?
Here are Global Firms, Who Owns Them?
B. Husky Energy
E. Euro-Disney
F. Johnnie Walker Scotch Whisky
G. Gerber Baby Foods
J. All-Clad Metalcrafters
K. VP Schickedanz
Small to Medium Size Companies
The definition of what constitutes small and medium size varies (making it hard to compare worldwide)
Also can create a global brand (but usually a single brand in a single industry, e.g., Dr Martens)
Also can be “hidden champions” Can be a global start-up
– Logitech—founded by people from different countries, headquartered in two nations, to serve a global market
Often depend on entrepreneurial behaviors
Brands and Society – Brands satisfy human needs for belonging and satisfaction– In nations where standards are low, brands provide assurance
of product quality– Brands also raise public awareness about firm behavior and
mediating organizations motivate many To pursue social and environmental responsibility within
the firm—internal adaptation mediated by NGOs like Greenpeace
To address issues that occur outside the firm—external adaptations that make firms mediators for others even as others mediate these issues for them
– Suppliers’ treatment of employees or ways they extract raw materials
– Some go on the defensive– Some focus on values and proactive efforts
The Bottom Line on Global Firms
Whether large, medium or small
Whether public or privately owned by families or by shareholders or by the government, etc.All contribute to and are challenged by characteristics of globalization.
Among Challenges Relevant to Your Studies, Consider the
Effects of Diverse participants in the industry studied Stakeholder and owner activism
– Individuals and institutional
Competing models of how to manage globally– The Anglo Saxon model is more “hands off” and
encourages shorter run profit motives
– The Rhine model is cooperative and encourages more social engagement for firms
We do Not Know the Outcomes, but We do
Know: These challenges are altering firm
management such that nations are adopting practices from other settings– Asian collectivism accommodates revised
social contracts, e.g., layoffs– Anglo Saxon traditions are revised to
separate the CEO from the Board– The Rhine model experiences pressures to
generate shorter term profits
As a General Statement We Can Say:
Corporations worldwide are under pressure to consider themselves– Members of a dynamic community– Linked by networks of interdependent teams– Composed of self-managing people with diverse
characteristics and talents– Guided by shared purpose– Leaders committed to continuous learning and
improvement– In service to maximum long-term customer satisfaction,
employee and shareholder enrichment, and the health of the larger society