This article is identifying the suitable to manage in a border-less world, it identifies the purpose for the companies to go abroad and trying to invest in foreign countries regardless of the way to enter it, like joint ventures, wholly owned businesses, licensing …but effective global operations require a genuine equidistant of perspectives. But even with the best will in the world, managers find that kind of vision hard to develop and harder to maintain.
One of the factor that encouraged companies to go abroad is that so many things have changed from the past, today people of course everywhere are more and more able to get the information they want directly from all corners of the world. they can see for themselves what the tastes and preferences are in other countries, new fashion styles, the sports and their lifestyles and so on.
Managing effectively in this new border-less environment does not mean building pyramids of cash flow by focusing on the discovery of new places to invest. nor does it mean tracking our competitors to their lair and preemptively undercutting them in their own home market.
Most managers in all big companies are trying to increase their sales and market share, but the only way nowadays is to search for new market where there are new opportunities (especially in the far east) in order to expand their businesses.The major purpose to go internationally is due to the intensive and huge competition the companies are facing in their local markets, domestic and foreign competition.
The other factors that lead managers to manage in a border-less world are the cost factor that all companies care about because it will identify the profit margins. We all know the economists are seeing china is the future vacancy to invest in due to the huge population there, in spite of the availability of very cheap raw materials and very low labor cost which is very interesting for these companies.
By this way so many companies did that like Sony which has now factories in Malaysia and china where the production cost is very low and they can provide their customers with cheaper products at the same level of quality thus they can quarrel with Aiwa and Sanyo.
There are some threats that every management must take into consideration before investing in any country abroad like, the economic situation of that country, the currency rate, interest rates, inflation rate and unemployment rate…that’s why this article is trying to teaches us that there is a lot of danger if we decide to invest in any company, sometimes our company may incur a very big loss because they did not understood the culture of a certain country. the major and deadly action that may end our existence in any country in trying to change the culture and traditions of a certain nation like what nestle was trying to do in Italy which is a major fault which caused their market share to be only 1%.
We have few multinational Lebanese corporations that are in need to expand internationally but this concept of investing internationally is an opportunity for the Lebanese companies to find bigger markets than Lebanon which is a very small market .Some companies see Lebanon as an opportunity for them to invest in like KFC,Starbucks,Dunkin Donuts…in addition of the hospitality chains which invested their money in Lebanon depending on the tourism season that will cover the low season losses which is in my opinion a very big mistake ,hotels number is increasing year after a year and the Lebanese market is becoming saturated.
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