Multinational Cooperation Business Organization

Question: Discuss about the Multinational Cooperation Business Organization. Answer: Introduction The international business consists of the commercial transactions which take place between multiple regions beyond their geographical boundaries (Dunning, 2012). These kinds of businesses include the cross border transactions made for the purpose of gaining business profit. The international business decisions are one of the most crucial tasks of cross cultural organizations. The quality of the decision making activity would determine the success of the firm. There are instances when the cross cultural business undergo through a lot of challenges. The globalization has impacted the organizations significantly. This report is based on the interview with the business owner of Conbridge Advisory Group. The interview was performed at his office on 5 December. This report would also highlight two most important components of international business such as international business decisions and the international business challenges. Conbridge is a Turkish firm which started its business operations 12 years ago (Conbridge.biz, 2016). The organization engages in energy trading. It supplies electricity as well as gas in Turkey and the adjoining areas of Greece, Bulgaria, Russia, Azerbaijan and Georgia (Conbridge.biz, 2016). The company has strong reputation in the fields of Chemicals and Petrochemicals, Energy and Utilities, Tourism, Defense, Telecommunications and others (Conbridge.biz, 2016). The company believes in innovative, entrepreneurial and output driven consulting approach. The Executive The interview was conducted with the Chief Executive Officer of the multinational organization. He has 22 years of experience in international business and his major job roles were involved in the entrepreneurial level and executive level. His job characteristics are concerned with the commodity trading based on an international level. His corporate background involves a high school degree and training in the role of industrial salesman. He has corporate experiences in the different corporate positions. The interview gave some important insights regarding the international business scenario in the organization. The business owner shared that he took crucial international business decisions especially during the initial phases of his career. The international strategies concern with the diffusion and adaptation of the companys knowledge as well as expertise in the foreign markets (Verbeke, 2013). He has considered the decisions based on the national differences in the economic, political and the legal systems. He also takes an active role in managing the cross-border collaboration. It is important to have clear channels of communication between the employees located in diverse geographic locations (Verbeke, 2013). The manager strives to create cross cultural literacy and must formulate strategies that protect against ethnocentrism. International Business Decision The CEO shared that he made his business decisions based on his own decisions as well as leadership. He shared his experience on a particular international business decision. He wanted to venture in the international market so that he can avail more market opportunities. The international business expansion has been done by venturing into new market. The business expansion was done in Turkey and the adjoining areas. He was aware of the free trade agreements between the host countries and the foreign locations. The business decisions were made as per the business decisions. The components of the global expansion objectives include flexibility, efficiency and learning. The business decision also comprised of the mode of entry in foreign locations. The mode of entry selected by the manager was joint venture. It involves the collaboration with the prosperous business which already exists in host country (Beamish, 2013). The decisions would also base on the differences in the culture of t he individual nations. The values, norms and the beliefs of the host country should be taken into consideration while designing the international business expansion plan (Beamish, 2013). The various determinants include religion, education, politics, language and social structure. The manager also determines the patterns of FDI so that he can incorporate them in the business decisions (Driffield, Jones Crotty, 2013). The growth of FDI should be analyzed along with the globalization of the world economy. The foreign domestic investment should also determine the suitability of a particular location for the purpose of doing business (Beamish, 2013). It is important to assess the profitability of the foreign location by understanding their economic estimates. The international business decision making should be done in all the matters concerning the business expansion or the existing business operation (Gabrielsson Gabrielsson, 2013). It should be done in the crucial matters concerning the international businesses. The decision making should be done by following the below steps- Define the business issue Analysis of the problem Searching for alternatives Selection of the best alternative Implementation of the best alternative Monitoring and evaluation The decision making activity should take into account all the concerned stakeholders in who are directly or indirectly involved with the international business project (Papadopoulos Heslop, 2014). The decision maker should focus on fostering worldwide innovation as well as learning. The transnational innovation should be taken into consideration while venturing into new market area (Walshok, Shapiro Owens, 2014). There are two emerging transnational thoughts such as locally leverage as well as global linkages. The local leverage would comprise of the unique capabilities of the different subsidiaries (Papadopoulos Heslop, 2014). The global linkage comprises of the joint collaboration of the capabilities and the resources. International Business Crisis The international business is always associated with the number of challenges. The CEO of the company shared that the primary challenge was the cross cultural differences. There are instances when it is difficult or adapt to the local countrys culture. The cross cultural literacy, which refers to the understanding of the cultures of the host countries are difficult to achieve at times (Tselmann et al., 2016). The lack of cultural understanding leads to lack of understanding the business costs associated with the foreign country. The inability to gauge the cost implications would lead to inaccurate business plans. The culture also plays a major role in the organizational behavior and it is an important factor for understanding the behavioral aspects of the local employees (Tselmann et al., 2016). There can be difficulty in creating good inter relationships with the people, uncertain living, issues with motivational orientation and attitudes towards the time factor. There are also issues with the foreign exchange rate shock while venturing into a foreign location (Ger, Mercan Peker, 2013). The manager needs to take into account the exchange rate systems prevalent in the respective countries. However, there are instances when they are unable to do so. This also indicates the capability of the country to absorb the economic fluctuations (Ger, Mercan Peker, 2013). The managers are sometimes unable to gauge the ability of the country to cope up with the global financial crisis. The tax rate of one country may not be same with that of the other countries. The corporate tax rate of Georgia is 15% while the tax rate of Turkey is 20% (Alvaredo et al., 2013). It is 20% in Azerbaijan while the corporate tax of India is 30%. Hence, it is important for the international business managers to take these things into account for successful business venture. There are instances when the company may start their business operations in a country which is governed by high tax rates along with high GST rate (Alvaredo et al., 2013). It is important to take into account the additional tax jurisdictions, government regulations, multinational tax management and others. There are instances when the international business manager does not take into account the challenges of the global financial crisis and thee steps to overcome them. This affects the smooth functioning as well as the profitability o the new business in new geographic locations. The cross cultural management may also face the issues involved in the enforcement of the intellectual property rights. The IPR is concerned with the protection of the works of the innovators as well as original content creators (Acemoglu Akcigit, 2012). There are various issues that may arise such as copying or misappropriation of the original works by unauthorized parties. There may be issues with the piracy and counterfeiting (Acemoglu Akcigit, 2012). The offenders are gaining illegal access to the consumer goods and launch them in the market with duplicate names. In this age of technological advancements, the counterfeiters are finding it easy to make fake copies of the original products. This creates utter chaos among the customers who might think the duplicate products as the real items (Acemoglu Akcigit, 2012). This may damage the brand reputation of the company and this have a damaging effect on the goodwill of the company. Hence, it is important for the managers to concen trate on enforcing the intellectual property rights. Learning from case study project The case study project helped in clear understanding of the concepts related to the international business. The decision making in the international business is one of the important components for surviving in this competitive world. The decision making comprises of several factors that are needed to be considered while engaging in crucial decision making for the organization. The real interview with the senior management of an organization gives crucial authentic information regarding the decision making in the international business. This report also helped to understand the challenges faced by the international organizations. The real problems of the top level executives helped to understand the actual difficulties faced by the managers while engaging in international trade. Conclusion The international business is mainly concerned with profit making motives. The globalization has opened the doors for business to cross geographical boundaries for greater business prospects. The decision making is a major activity for the international firms in which there is the involvement of a large number of decisions for the smooth operations of the firm. The interview was conducted with the CEO of Conbridge Advisory Group. The report has defined the background of the company along with the background of the business owner. The report has also mentioned the major issues that are being discussed in international business. Important concepts are being discussed such as cross border collaboration, channels of communication, decision making process and the transnational innovation. The report also focuses on the international business crisis which is prevalent in the organizations. The major issues discussed are the cross cultural differences, foreign exchange rate shock, diverse t ax rate and the intellectual property rights. This report would broaden the understanding of the international business decision making and the international business crisis. The practical understanding of the international business is done through the help of real time interview with the senior management. References Acemoglu, D., Akcigit, U. (2012). Intellectual property rights policy, competition and innovation.Journal of the European Economic Association,10(1), 1-42. Alvaredo, F., Atkinson, A. B., Piketty, T., Saez, E. (2013). The top 1 percent in international and historical perspective.The Journal of Economic Perspectives,27(3), 3-20. Beamish, P. (2013).Multinational Joint Ventures in Developing Countries (RLE International Business). Routledge. CONBRIDGE ADVISORY GROUP. (2016).Conbridge.biz. 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