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Determinants of the organizational culture
Determinants of the organizational culture
Determinants of the organizational culture
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The article ‘A theory of international new ventures’ written by Shaker A Zahra (2005) preludes to the essential framework established by Oviatt and McDougall (1994) and provides the Oviatt and McDougall (1994) definition of an INV whilst leading to an examination of an identified gap which existed within the theory. However, Zahra (2005) recognized that the article provides a framework in the studies of International New Ventures (INVs); in the importance of new ventures (smaller and younger); its relevance to the international position; and value creation.
There are key factors Zahra (2005) extracts from Oviatt and McDougall (1994); explained below:
1. Age factor versus action factor: two areas, highlighted, to determine what would be more determining factor in order to produce results in the international arena. Zahra (2005) discussed that sub-element on establishing the actual period of gestation period was difficult to determined as new ventures starts at different stages; for example, one derived from an established company. This INV would benefit from the wealth of knowledge and resources necessary to be competitively advantaged.
2. Managerial Capacity: It was stressed throughout the article that may benefit, even at the offset of the INV from the managers to foresee opportunities and seize them by strategizing and understanding the international market arena.
3. Zahra (2005) argued the importance for INVs to protect their unique intangible assets such as organizational culture, relationship and innovative capabilities.
4. Entrepreneurial quality; the ability for managers to refocus, shift and adapt over time may be beneficial; allocating resources and gaining access to international network and chain value; or detriment...
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... of general understanding of laws and regulations which governed the countries the INV will conduct business.
Flexibility is a requirement in globalization, once conducting business with another company or individual in another region or in the international arena, this may be considered to add to globalization. Advance technology and the hypercompetition condition faced by new venture forces, a mandatory flexibility to adjust and adapt. “.. Responsiveness and product adaptation are becoming increasely critical for business success, proximity to foreign customers is an important driver of overseas investment” (Shenkar and Luo, 2007 pp 13).
Reference
Child, J. (2005) Organization: contemporary principles and practice. Malden, MA: Blackwell Publishing, pp. 29.
Shenkar, O. & Luo, Y. (2007) International business.2nd Ed. Thousand Oaks, CA: Sage Publications pp 50)
Griffin, R. & Pustay, M. International Business, 2003, Pearson Education, Upper Saddle River. Pg. 301
Flexibility is important of firms an operation that enables it to react to their customers quickly and efficiently. Some companies use they two types of flexibility: the customization or the volume flexibility. Customization is usually the ability to satisfy the unique needs of each customer by changing products or services design, with different features, or making them look unique. Primark’s uses both operations. To satisfy their customers need. While volume flexibility is the ability to quicken the rate of their productions to handle large variations in demand.it is usually important for operations. Both companies use both operations.
A business can either take a step forward or a step back depending on the external and internal influences and how they handle them, they can either flourish or enter stages of degradation and cessation. External and internal influences on a businesses plays a part in the opportunities that arise in the industry the business operates in, otherwise the business may choose to venture out of it’s defined industry depending on the opportunities at hand. Businesses are affected by internal and external influences to a degree where they are either benefiting or suffering from the way they handle opportunities that arise. The five articles depict the problems encountered by businesses no matter their size or industry.
The following essay explores the reasons why companies enter into IJVs, in spite of their high failure rate. It also provides recommendations to companies to enable them to increase the likelihood of success. REASONS FOR ENTERING INTO AN IJV:
Hill, C., Wee, C. and Udayasankar, K. 2012.International Business:An Asian Perspective. 8th ed. Singapore: McGraw-Hill.
Our economic development will forever be defined as our ability to succeed internationally. PwC forecasts India’s real annual GDP growth until 2050 at 8.9 percent, Vietnam’s at 8.8 percent, and China’s at 5.9 percent. The list of fast-growing emerging markets goes on and on. The U.S. forecast is a meager 2.4 percent, comparable with most Western economies. The domestic companies that are likely to see incremental growth in the coming decades are those that are not only doing business internationally, but that are developing the strategic skill set to master doing business across cultures. Cross-cultural core competence is at the crux of today’s sustainable competitive advantage. For example, political environment will tell us, as to how and why political leaders control, whether and how of international business. Legal environment, both national and international will tell us about many kinds of laws by which business firms must work. The cultural environment will tell us about attitudes, beliefs and opinions important to business people. Economic environment will tell us about the economic system being followed by the host country, which may or may not be different from home country. It will also explain the variables such as level of development, human resources, Gross Domestic Per Capita and consumption patterns that determine a firm’s ability to do business. Geography will tell us about location, quantity, and quality of the world’s resources.
Svensson, G., 2001. 'Globalization' of Business Activities: A 'Global Strategy' Approach, Management Decision, 39(1), pp.6-18.
The distinction between the start-up and growth stages in not easily defined. The distinction lies in the revenues, profits are stronger and are consistent with an increase in customers, as well as, new and exciting opportunities for the employees to pursue. Managers can look forward to many managerial challenges, perspective policy issues and re-evaluating the business plan for revisions. A manager’s focus should be in the running of the business, with a greater emphasis on accounting and human resource management systems. New staff will have to be hired, trained and prepared for the influx of business.
Corporate Entrepreneurship can be seen as the process whereby an individual or a group creates a new venture within an existing organization, revitalizes and renews an organization ,or innovates. Zahra’s(1986) definition of corporate entrepreneurship suggests a formal or informal activity aimed at creating new businesses in established firms through product and process innovations and market developments,whereas sathe(1985) defines corporate entrepreneurship as a process of organizational renewal. Corporate Entrepreneurship has emerged as a much needed ingredient contributing towards the growth of any organization under a changing business environment.
1John D. Daniels and Lee H. Radebaugh, International Business: Environment and Operations (USA: Addison Wesley Longman, Inc., 1998), 181.
18. Rugman, Alan M. and Collinson, Simon. International Business 4th Edition. Essex : Pearson Education Limited, 2006.
This indicates the importance of strategic management for organisations in making appropriate decisions and selecting strategies which will assist them to gain strategic competitiveness and as a result earn above-average returns.
Since the end of World War II, international operations have become a reality for an increasing number of corporations. Many of these initial efforts began as simple export schemes to sell goods overseas to supplement domestic sales. Over time, however, international operations have become increasingly more complex: from joint-ventures to purchasing existing foreign firms to ‘green-field’ start-ups. While export operations usually require no more than extended business trips overseas, more complex international operations demand long-term assignments of key personnel outside their home-country. What would normally be considered routine business transactions in the home country can become very complicated when they are conducted between individuals and organizations from different cultures. In this essay we will examine how this cultural gap can affect international business and joint ventures.
Daniels, J. D., Radebaugh, L. H., and Sullivan, D. P., (2011). International Business: Environments and Operations. Prentice Hall, Upper Saddle River, New Jersey.
Stonehouse, G., Campbell, D., Hamill, J. & Purdie, T. (2004). Global and Transnational Business (2nd ed.). Chichester: John Wiley & Sons.