Free Essay

International Management: Managing Across Borders and Cultures

In:

Submitted By nadya1
Words 753
Pages 4
Case Questions
1. How has the global economic downturn, discussed in the opening profile and throughout this chapter, impacted jobs outsourcing in the BPO industry?

The global economic downturn caused uncertainty, which again lead to a major desire to cutting cost. This made firms look overseas for cheaper opportunities and advantages like lower wages and taxes. In the case of India’s BPO, the industry grew as a result of this. Already in 2004-05 the number of captive and third party service providers added up to about 400 companies in the Indian BPO sector. Furthermore India’s exports of ITES/BPO services were estimated to have an annual growth rate of 26% through 2010. However the economic downturn resulted in the dollar weakened and the rupee strengthened, which made it harder for firms to be profitable in India. At this point companies had already started to look at Singapore, China, the Philippines, and Malaysia. Especially the Philippines emerged to a promising outsourcing destination with world-class infrastructure, ten year tax-break, an Americanized culture and language due to 50 years of colonial influence.
2. referring to this chapter and this case, discuss the general trends in the globalization of human capital?
Western companies are tending to move certain services to the Asian countries such as customer care, medical transcription, medical billing, payroll management and tax processing. The information technology services have also played a key roll contributor to the economic growth of these countries. The western countries are looking for countries in Asia have certain characteristics such as English speaking, manpower, high-end telecom infrastructure and strong quality orientation within the industry. The main reason for this outsource is to lower their costs and increase their profit margin.
3. What are the effects of the Indian government policies on the Indian BPO industry and on MNC decisions regarding locations for outsourcing jobs?
The BPO is considering transferring to other countries such as the Philippines, because the Indian government policies, like no investment in infrastructure, no extension in the STPI, expensive transportation of the labor force, and low incentives on taxes are making BPO more expensive than what they expected, while other countries are offering more incentives to attract the BPO.

4. How does this case highlight the threats and opportunities facing global companies in developing their strategies?

The high competition in attracting FDI, plus the rapid changes in each country policies and in the world economy, obliges each company to take rapid decisions in what theirs strategy will be. New threats and opportunities are emerging each day such as attractive incentives to establish operations in a country or increasing costs.
The Indian labor market has always been key in globalization, and has been attractive due to its low wages, and the scientific and managerial talent found in the country. The main issues faced in this case mostly stem from the loss of the tax abatement in India, in addition to the weakening US dollar. Due to these two issues, doing business in India versus other fruitful options like Philippines becomes very expensive. These are major challenges to combat for any firm looking to outsource in India. In India, the infrastructure along with the setback discussed around transportation, puts a strain on the bottom line. The Tax abatement ending in 2009 was the initial cause of the dilemma. India's transportation and infrastructure costs are here to stay and other countries like Philippines have much more attractive incentives to bring in higher margins for the multinational corporations. The entire flow and boom of bringing BPOs into India has been affected due to this. The top dollar return on investment for a multinational corporation to bring their business into India is no longer there. However, it is there in the Philippines with the same levels customer satisfaction to be achieved. The solution is that if India wants to keep BPO’s around, they need to revisit re-instating the tax abatement as well as figure out ways the government cover the transportation costs. The Indian government needs to do everything they can to prevent these BPO’s from transplanting or just picking up their entire business and relocating to another country. They should place them in a lower tax bracket for them to stay in India. They should cover the costs of transportation as an additional incentive. At the end of the day, it comes down to profitability and return on investment. It has to be worthwhile for these firms to keep their BPO's wherever they have them.

Similar Documents

Premium Essay

International Management: Managing Across Borders and Cultures, Text and Cases, Seventh Edition

...International Management: Managing Across Borders and Cultures, Text and Cases, Seventh Edition SEVENTH EDITION FEATURES • Streamlined text in eleven chapters, with particular focus on global strategic positioning, entry strategies and alliances, effective cross-cultural understanding and management, and develop- ing and retaining an effective global management cadre. The seventh edition has been revised to reflect current research, current events and global developments, and includes company examples from the popular press. In Chapter 1, we introduce trends and developments facing international managers and then expand those topics in the context of the subsequent chapters. For example, we discuss developments in globalization and its growing nationalist backlash— in particular resulting from the global financial crisis. We discuss the effects on global business of the rapidly growing economies of China and India and other emerging economies such as those in Africa, and the expansion of the EU; the globalization of human capital; and the esca- lating effects of Information Technology and the global spread of e-business. We follow these trends and their effects on the role of the international manager throughout the book. For exam- ple, in Chapter 6 we focus further on strategies for emerging markets, while also dealing with changing strategies to respond to economic decline around the world and an increasing level of nationalism in some industries; we have a...

Words: 1340 - Pages: 6

Premium Essay

112312

...Chapter 7 Cultural Diversity in Cross-Border Alliances Susan E . Jackson Randall S . Schuler Introduction Increasingly, firms are using cross-border alliances to strengthen and maintain their position in the market place . Although often seen as a relatively fast and efficient way to expand into new markets and incorporate new technologies, the success of cross-border alliances is by no means assured . To the contrary, such alliances often fall short of their stated goals and objectives . While some failures can be explained by financial and market factors, the failure of others can be traced to neglected human resource issues and activities associated with managing the cultural diversity present in these organizations . This chapter describes the special challenges that cultural diversity creates for effectively managing human resources within cross-border alliances . Drawing upon the extensive literature regarding the management of domestic alliances and domestic diversity, we offer suggestions for how human resource management practices might be used to improve the success of cross-border alliances . Regardless of industry, it appears that it has become all but impossible in our global environment for firms to successfully compete without growing and expanding through deals that result in cross-border alliances (CBAs) (Lucenko, 2000) . In some industries, e .g., insurance, cross-border alliances provide a means for moving into new markets . In other...

Words: 13871 - Pages: 56

Premium Essay

Culture

...MANAGING CULTURAL INTEGRATION IN CROSS-BORDER MERGERS AND ACQUISITIONS Daniel R. Denison, Bryan Adkins and Ashley M. Guidroz ABSTRACT Cross-border M&A has become one of the leading approaches for firms to gain access to global markets. Yet there has been little progress in the research literature exploring the role that culture may play in the success of these ventures. Poor culture-fit has often been cited as one reason why M&A has not produced the outcomes organizations hoped for (Cartwright & Schoenberg, 2006). Cross-border M&A has the added challenges of having to deal with both national and organizational culture differences. In this chapter we review the literature on cultural integration in cross-border M&A and provide a framework designed to help manage the integration process throughout the M&A lifecycle. This framework presents culture assessment and integration as a crucial component to reducing poor culture-fit as a barrier to M&A success. Mergers and acquisitions (M&A) have become a central part of most corporate growth strategies, and an increasing portion of that M&A activity now spans national borders. Indeed, beyond a certain scale, one might say that all M&A is now cross-border M&A. For example, even a merger Advances in Global Leadership, Volume 6, 95–115 Copyright r 2011 by Emerald Group Publishing Limited All rights of reproduction in any form reserved ISSN: 1535-1203/doi:10.1108/S1535-1203(2011)0000006008 95 96 DANIEL R. DENISON ET AL. between two large...

Words: 7716 - Pages: 31

Premium Essay

Assignment

...MANAGING CULTURAL INTEGRATION IN CROSS-BORDER MERGERS AND ACQUISITIONS Daniel R. Denison, Bryan Adkins and Ashley M. Guidroz ABSTRACT Cross-border M&A has become one of the leading approaches for firms to gain access to global markets. Yet there has been little progress in the research literature exploring the role that culture may play in the success of these ventures. Poor culture-fit has often been cited as one reason why M&A has not produced the outcomes organizations hoped for (Cartwright & Schoenberg, 2006). Cross-border M&A has the added challenges of having to deal with both national and organizational culture differences. In this chapter we review the literature on cultural integration in cross-border M&A and provide a framework designed to help manage the integration process throughout the M&A lifecycle. This framework presents culture assessment and integration as a crucial component to reducing poor culture-fit as a barrier to M&A success. Mergers and acquisitions (M&A) have become a central part of most corporate growth strategies, and an increasing portion of that M&A activity now spans national borders. Indeed, beyond a certain scale, one might say that all M&A is now cross-border M&A. For example, even a merger Advances in Global Leadership, Volume 6, 95–115 Copyright r 2011 by Emerald Group Publishing Limited All rights of reproduction in any form reserved ISSN: 1535-1203/doi:10.1108/S1535-1203(2011)0000006008 95 96 DANIEL R. DENISON ET AL. between...

Words: 7716 - Pages: 31

Premium Essay

Importance of Hr in Business

...of HR Running Head: Importance of HRM in International Business Importance of HRM in International Business [Name of Author] [Name of Institution] 1- Outline Importance of human resource management is now globally recognized and business growth is related to better management of human capital of a company. The present research proposal, henceforth, sets ground to investigate the importance of managing, running, and stabilizing human resource in order for the growth of business. It aims to contribute to the existing research of human resource management (HRM) by organizing secondary sources and relating it specially to the expansion of business across borders that has come to be known as multinational companies operating in a number of different countries (INVESTOR, 2008). The paper also examines various facets and implications of across border business activities that aim to take place majorly due to HR issues such as mergers, acquisition, and so on (Chapman, 2001). Another important aspect of HR and business spreading over the international boundaries is cultural aspects of a specific region, country, or state that a business venture must come to recognized as a valid component. It is important to realize that in the flourishing of withering of a business local culture plays a decisive role. Related to this is the issue of workplace culture where, as in today’s global workplace, workers come from different cultures and backgrounds to work together. Hence it is...

Words: 1095 - Pages: 5

Free Essay

Is Culture Really All That International Human Resource Manager Is About?

...Is culture really all that International Human Resource Manager is about? * Introduction * Diversity Management * IHRM & Culture issue * Conclusion * References Introduction People have always been the driving force of business and management. This force is a challenge and if not addressed with the right skills, it will develop into disturbing elements that are very dangerous for the management of the company. The challenges of global talent selection and mobility of labor, established by a career concept that transcends national borders and organizational groups and the emergence of virtual collaboration on international projects requires companies to develop new skills in their employees to be effective in the complexity of today's contexts. The workforces are people, and as we are human, we are all different from various points of view. This paper aims to answer the question: “Is culture really all that International Human Resource Manager is about?” I’ve analyzed the differences between HRM and IHRM based on the concept of diversity, characteristics that influence both topics but in a different way. After this, the next stop is to define IHRM and the concept of culture to reach the conclusion that managing cultural differences in an international team is the major challenge to IHRM. Due to the movement of employees between foreign subsidiaries and headquarters and between foreign locales, HRM professionals are likely to...

Words: 3258 - Pages: 14

Free Essay

Reward System Between Countries

...the employees who has gone above and beyond his or her responsibilities; making noticeable contributions to the success of the company. Within the North American regions the reward system are based on financial needs, social status, job contents, career, and professional according to the Helen Deresky in International Management: Managing across Borders and Cultures in 2011. Within our Hong Kong office the reward system is based on seniority, which is the total opposite of how the North American region would go about motivating their employees. “Clearly, then, managers must use persuasive strategies to motivate employees when they do not readily connect their personal work behaviors with outcomes or productivity” (Deresky, 2011, p. 390). Hong Kong employees believe outcome is based on luck whereas North American employees believe hard work will help him or her get closer to rewards such as promotions. Consultants should use this knowledge of the reward systems within different cultures or countries to develop a program that will encourage increased productivity and performance. Developing cultural awareness should be conducted base on the motivational traits within that culture. In North America, employees might be willing to accept and participate in cultural awareness if the benefits align with his or her needs. Hong Kong employees might be willing to accept and participate cultural awareness if the benefits...

Words: 312 - Pages: 2

Premium Essay

Sdddwdwdwdwdwd

...f e a t u r e a r t I C Le   647 Interaction Effects of Globalization and Institutional Forces on International HRM Practice: Illuminating the ConvergenceDivergence Debate By Yongsun Paik Irene Hau-Siu Chow Charles M. Vance In the face of globalization, scholars continue to debate about whether a convergence in human resources practices will prevail, or a trend of divergence perspective will persist. Building on institution theory, this article helps to explicate this debate by examining how globalization may interact with different dimensions of local institutional forces to lead to convergence, divergence, or crossvergence Correspondence to: Yongsun Paik, PhD, Professor of International Business & Management, Department of Management, Hilton Center for Business, Loyola Marymount university, One LMu Dr., Los angeles, Ca 90045-2659, 310.338.7402 (phone), 310.338.3000 (fax), yspaik@lmu.edu. Published online in Wiley Online Library (wileyonlinelibrary.com) © 2011 Wiley Periodicals, Inc. • DOI: 10.1002/tie.20440 648 f e a t u r e a r tI C l e in international HRM practices for enhanced performance. We also present useful propositions for guiding future empirical research and theory development on the interaction between globalization and different forms of local institutional forces, which in turn influence the formation of successful international HRM practices. © 2011 Wiley Periodicals, Inc. Int r o d u c t i o n N otwithstanding the current worldwide...

Words: 9037 - Pages: 37

Free Essay

Slfja;

...Outcomes | Readings | Events | Learning Assessments (%) | 1 Jan 7 | An Introduction to International Management | Analyze current and emerging realities in the global market place | Textbook: Chapter 1,in-class materials,Wide Web sources | LectureDiscussion | | 2 Jan 14 | An Introduction to International Management | Analyze current and emerging realities in the global market place | Textbook: Chapter 6, in-class materials,Wide Web sources | LectureCase study | 3 | 3 Jan 21 | Assessing The Global Environment: Macroeconomic | Evaluate the impact of global macroeconomic environment on managerial decisions | Textbook: Chapter 1, in-class materials,Wide Web sources | LectureMini-practicalsIntegrative Term Project | 21 | 4 Jan 28 | Assessing The Global Environment: Legal and Political | Assess major implications of the legal environment and political risks for foreign operations | Textbook: Chapter 1, in-class materials,Wide Web sources | LectureDiscussionIntegrative Term Project | 2 | 5 Feb 4 | Cultural Context of International Management | Modify management style to incorporate important cultural dimensions | Textbook: Chapter 3, in-class materials,Wide Web sources | LectureCase studyIntegrative Term Project | 22 | 6 Feb 11 | Communicating Across Cultures | Recommend effective approaches to overcome the existing barriers to communicate across borders | Textbook: Chapter 4, in-class materials | LectureMini-practicals | 2 | Feb 18 | READING...

Words: 473 - Pages: 2

Premium Essay

My Work

...I: Introduction I. A: Rationale/Motivation​​ Over the past two decades, cross-border or international mergers and acquisitions (IM&As) have become the favored method of foreign direct investment (FDI). The form shows that IM&As go both ways: toward developing countries and from them, reshaping the world’s economic boundaries. Trends notwithstanding, researchers suggest that, overall, the expected financial benefits of M&As are often not recognized. The highest rate of failures has been linked mainly to the fact that “M&As are still designed with business organization and financial fit as primary conditions, leaving psychological and cultural issues as secondary concerns”. While as new countries start out into the free-market economic system, paying attention to cultural factors in IM&As is becoming essential. The wider cultural gap and the current trend of IM&Asbetween developed and developing countries increases the urgency of understanding the effects of civilization on the dynamics of IM&As and on issues such as corporate organization and local adaptation strategy. The present research is designed in response to this shortcoming. It examines the effects of culture on the outcome of IM&As and the variability of these effects during the different phases of an IM&A. The research focuses on the international aspect of cultural conflicts—the differentiating factor between domestic mergers and acquisitions (M&As) and IM&As. It measures success from an organization’s internal...

Words: 3556 - Pages: 15

Premium Essay

Management and Leadership

...Management and Leadership Larry E. Baumann MGT 330 December 8, 2010 Ben Douglas Management and Leadership Introduction Management and leadership will be differentiated in this paper and the roles, responsibilities of leaders play in creating, and maintaining an organizational culture will be discussed and an evaluation of the affect of globalization and management across borders. Moreover, strategies that managers and leaders can utilize are examined. Management and Leadership Management and leadership are interchangeable functions but are not the same, are uniquely different. Managers and leaders must be able to differentiate between the two and have the ability to determine which function is considered necessary. Effort must be taken not to spate the two, as it often is problematic. However, much time is spent delineating the differences. Basically, the manager’s job is to plan, organize, and coordinate. The leader’s job is to inspire and motivate. Warren Bennis listed the differences in his 1989 book “On Becoming a Leader” [ (Bennis, On Becoming a Leader, 1989) ]. The manager administers; the leader innovates. Leaders are often visionaries and see the big picture while it is the role of the manager’s role to utilize the tools necessary to achieve the leader’s innovation. The manager is a copy but the leader is an original. Managers often do not originate new ideas but ensure a successful outcome. Thus, the manager maintains and the leader develops...

Words: 1685 - Pages: 7

Premium Essay

Marketing Case Study

...MBA in International Management Course Syllabus Course Name: International Business and Marketing Instructor’s Name: Prof. Dr. Britta Bergemann E-mail: britta.bergemann@stw.de Class Time: 2.00PM – 8.00PM 1. Course Description This course looks at international business and marketing topics in theory and practice (case studies). It aims at building students’ awareness of business and marketing mix issues in the global context, and provides the tools to manage products and brands globally. 2. Overview This course offers a framework that allows students to see the big picture. After laying the foundations students will learn about the fundamentals and strategic impact of globalization on today’s business decisions, and how to position, communicate and price products globally. Along the way students will also see how companies are dealing with global marketing issues due to a wealth of case studies and examples. 3. Learning Outcomes Upon successful completion of this course, students will have acquired: An overview of international business strategies An overview of current marketing principles and practice An in-depth understanding of the concepts required for developing and managing global markets An evaluation of the changes that have occurred in the competition for global markets A deeper look at the causes of cultural differences The ability to effectively apply analytical criteria in order to evaluate opportunities of global The ability to take...

Words: 996 - Pages: 4

Premium Essay

Globlization

...UNIT -1 GLOBALIZATION AND INTERNATIONAL BUSINESS Chapter 1: Globalization and International Business Prof. Madan Survase Globalization & International Business Learning Objectives    To explain the concept of globalization To elucidate factors influencing globalization To discuss global business expansion strategy for emerging market companies To explicate the concept of international business To delineate motives for international business expansion To expound the strategy for managing business in the    globalization era Globalization & International Business Chapter 1: Globalization and International Business Prof. Madan Survase Globalization of Business: A Historical Perspective In the initial years of human history, there were hardly any formal barriers, such as tariffs or non-tariff restrictions, for the movement of goods or visa requirements for the people. The concept of globalization can be traced back to the phenomenon of a nation-state. Globalization & International Business Chapter 1: Globalization and International Business Prof. Madan Survase Concept of Globalization The process of integration and convergence of economic, financial, cultural and political systems across the world. Globalization & International Business Chapter 1: Globalization and International Business Prof. Madan Survase Definition of Globalization Dictionary of Trade Policy Terms, WTO: “The increasing integration of national...

Words: 915 - Pages: 4

Premium Essay

How International Business Affected Hrm

...How International Business Affected HRM Terry Conry Human Resource Management 12 August 2014 How International Business Affected HRM Introduction Changing trends within globalization, technology, and e-business has caused for diversity to have an impactful effect on each & every aspect of business involving human resource management. Furthermore, there has been the enhancing demand for organizational flexibility. Human resource management has been very challenging within international regard. This has been the discipline, which trusts totally on the people, and its behavior has been decided through shared values. As values change from one generation to the next, from one country to another, and from one culture to the next, rules of human resource management have been regularly altered ("Going Global: Managing the HR Function across Countries and Cultures.," 2009). The effect of globalization combined with internationalization within increasingly competitive business arenas is required to be evaluated. This particular paper will give insight to how human resource management fits in along with contributes towards companies international business strategy, as well as discussing important factors that influence international human resource management with regards to globalization. • How has the growth in international business affected human resource management? A major outcome to internationalization...

Words: 1893 - Pages: 8

Premium Essay

International Human Resource Management (Importance Ad Significance)

...Table of Contents Introduction 2 Differences between Domestic and International Human Resource Management 2 What is Expatriate 4 IHRM has three dimensions 4 International assignments create expatriates 5 Increasing Importance of International Human Resource Management 6 Significance of International Human Resource Management 9 Conclusion 11 Reference……. 12 Introduction As we enter the new millennium, more and more companies are recognizing the importance of managing their human resources as effectively as possible. They are also recognizing that doing so, however, cannot be done without recognition and incorporation of the global context. It is virtually impossible to read a business periodical or newspaper anywhere in the world without seeing stories detailing the success of a company due to how effectively it manages its people. As the environment becomes more global, managing people also becomes more challenging, more unpredictable and uncertain and more subject to rapid change and surprise. Thus what we are witnessing within human resource management (HRM) is the rapid appreciation for and development of all aspects of global and international activities and issues associated with and affected by HRM. And because the importance of managing people effectively in the global context is so great, many companies are devoting a great deal more time, attention, skill, and effort into doing it well. To be successful, many firms have to compete...

Words: 3338 - Pages: 14