...CHAPTER 1 INTRODUCTION Chapter 1 emphasizes the internationalization of business and economic activity that has occurred since the end of World War II. Although international business activities have existed for centuries, primarily in the form of exporting and importing, it is only in the postwar period that multinational firms have become preeminent. The distinguishing characteristic of the MNC is its emphasis on global, rather than affiliate, performance. Specifically, MNCs ask, "Where in the world should we build our plants, sell our products, raise capital, and hire personnel?" Thus the true multinational is characterized more by attitude than the physical reality of an integrated system of marketing and production activities worldwide. It involves looking beyond the boundaries of the home country, and treating the world as "our oyster." Good examples include the globalization of GE's medical systems division and Arco Chemical. After stimulating student interest with this vision of the MNC, I then introduce the financial decisions that multinationals must make. I begin by discussing the key concepts and lessons from domestic finance that apply directly to international corporate finance. The lessons include the emphasis on cash flow rather than accounting earnings, the time value of money, the importance of taxes, and the unwillingness of investors to reward companies for activities (like corporate diversification) which investors could replicate for themselves at...
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...Outsourcing – A Global Challenge MBA-700 International Economics Abstract The choice to outsource is a major strategic decision not made lightly by companies in today’s global marketplace. Though it brings probable results of cost reduction, loss of control in your product or the quality of service rendered makes this a decision that should not be taken lightly. Though a concept decades old, outsourcing is a topic that brings out fervor in individuals fighting for or against it. It’s a debate centered on moral, economical, and political aspects, with feelings that intensify during economic downturns because of the This paper will discuss theories of outsourcing, while comparing and contrasting the disadvantages and advantages (SWOT Analysis – see Appendix 1) of a concept that is growing in global business. The paper will conclude, most importantly, with discussions on three outsourcing alternatives and their potential to re-invent the status quo. Introduction The advent of globalization has proven that outsourcing is not a hypothetical situation; it is a major strategic business decision growing in popularity that our American workforce must now face in the decline of our U.S. economy. Some believe that outsourcing has become a serious issue not only for our workforce, but also in our major corporations, and the political arena. Issues such as the security of our nation have become debate topics, with critics arguing that outsourcing has weakened national security...
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...to privatize the Department of Transportation (DoT) information systems management function. This function is currently being performed by 75 State employees, 43 of whom are members of Federated State Employee Union (FSEU) Local 343. On May 12, 2010 the Governor of Illinois notified the President of FSEU Local 343 about the State’s intent. The President of FSEU has asked the union members if the union should oppose the outsourcing proposal. On June 5, 2010 the FSEU Director of Human Resources responded to the President of FSEU Local 343 with the union member’s discussion and recommended opposing the outsourcing proposal. The paper uses the methodology from the book “Asking the Right Questions – A Guide to Critical Thinking” by M. Neil Bowne and Stuart M. Keeley, to analyze the memo from FSEU Director of Human Resources to the President, FSEU Local No. 343. Introduction The Illinois State intends to privatize the Department of Transportation (DoT) information systems management function. The Governor of Illinois notified Mr. Cesar Padilla, the President of Federated State Employee Union (FSEU) Local 343 about the State’s intent on May 12, 2010. The President of FSEU has asked the union members if the union should oppose the outsourcing proposal. In response to the request from the President of FSEU Local No. 343, Ms. Barbara Glenn, the Director of Human Resources FSEU responded with the union’s recommendation in a memo. Appendix A shows a complete response memo from the...
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...Hire A Literature Review The study investigates the evolution, pros and cons of outsourcing as business function. Many researchers have identified various reasons to outsource an activity following a set process. The review proposed a well defined integrated outsourcing process model for effective outsourcing. Using an example of a global company this study detailed the benefits of externalization process and concluded that outsourcing is successful if activity selected is correct. Hire OUT-Sourcing 2 Global Procurement (BMO 5307) Assignment 1 Hire OUT -Sourcing A Literature Review Hire OUT-Sourcing 3 Contents Introduction ............................................................................................................................ 4 United Technology Corp. (UTC) ................................................................................................... 5 Rise of an Era - History & Evolution ......................................................................................... 5 Why Outsourcing? ................................................................................................................... 5 Procurement Outsourcing & UTC................................................................................................ 6 Where To Begin? ..................................................................................................................... 7 What UTC Was Willing To Achieve? .................
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...Brazil’s Economy In 2001, Brazil was viewed as one of the up and coming, fastest growing economies in the world. In fact, Jim O’Neill wrote a paper titled, “Building Better Global Economic BRICs”, which is about the emerging economies in the world. The acronym BRIC represents: Brazil, Russia, India, and China (Smith). These global leaders have lived up to expectations and have grown at a much faster rate than the rest of the world. They have been able to lift millions of people out of poverty, including 40 million in Brazil alone. Will Brazil continue to be part of the BRIC in years to come? A 2010 Goldman Sachs report predicted by the year 2030 the BRIC countries would account for an astounding 41% of the world’s market share (Smith). But we now see that those predicted numbers are very far from certain. Many believe if Brazil does not improve some of its problems plaguing its society, the BRIC could easily become the RIC group. Without the necessary changes being made, Brazil’s annual compounding rate of 4.4% could be washed away. Recently the GDP numbers show their industrial output lingering around recession numbers. It is also predicted that the Brazilian economy will grow less than the U.S. economy this year (Rapoza). Brazil was originally able to secure its spot in the fastest growing nations in the mid to late nineties by bold privatization and economic liberalization policies by then president Fernando Henrique Cardoso. Cardoso’s successor, “Lula” da...
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...to which there is no measures taken on to control the fluctuations. Japan experienced magnificent growth through the 60's, 70's, and 80's leading into the 90's beginning. In the late 1990's, Japan’s economy marked its growth significantly slower, which had then come to be known as the 'lost decade' due to Japanese Asset Price bubble that collapsed. Eventually the nation faced major issues regarding environmental disasters, hollowing out of industries, etc. The past events which have caused the rise and downfall of Japanese Yen has been illustrated for examining the causes of the appreciation and depreciation of this currency. The influence of this floating currency on Japan's economy has been depicted in this case study. This paper also provides some applications of the measures that can maintain the stability of the Japanese Yen. Japan experienced tremendous growth throughout the 1960s, 1970s, and 1980s leading into the leading into the early 1990s. After World War II, Japan underwent a period of restoration followed by the events in 1978 where Japan excelled as a manufacturer partnering with the United States which helped to make its economy world's second largest economy until 2010, where it was surpassed by China, moving Japan to the world's third position. Japan’s economy saw growth slow significantly in the late 1990s which came to be known as the 'lost decade' due to the Japanese Asset Price Bubble collapse. This phase saw Japan run massive budget deficits in order...
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...THE AIRLINE INDUSTRY is in deep crisis. Losing over 100,000 jobs since September 11, 2001, and suffering major wage and benefit cuts, workers are in shock and looking for new leadership. The recent U.S. invasion and occupation of Iraq, the outbreak of the SARS epidemic and the economic downturn exacerbate the impact of the crisis on labor. Airline workers are in the forefront of discussions about their own industry and more general questions as political and social consciousness changes under the impact of the restructuring crisis. These experiences are valuable for all workers. While 9/11 and subsequent events greatly worsened the crisis, the dire state of this industry pre-dated the 9/11 attacks. The major carriers were losing millions of dollars and facing possible bankruptcy filings because of broken business models that were no longer profitable. In the capitalist system that generally means businesses fold. Bankruptcy as a Weapon Government aid still flows to the airlines, as it did after 9/11. But Wall Street and Washington are pushing the restructuring process. Meanwhile some important facts indicate the depth of the crisis and the challenge facing rank-and-file workers and their unions. Last summer US Airways, the seventh largest carrier, filed for bankruptcy and began slashing jobs, wages and benefits. It emerged from bankruptcy in the spring as a smaller carrier with lower labor costs than most of its competitors, but US Airways is still not out of turbulent...
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...Outsourcing 1/60 ABSTRACT: The main focus of this project is investigating and exploring the impact of outsourcing on one of the most iconic Danish companies (LEGO), which attracted our attention during the preparation of this project. We decided to focus on a single case study, because we felt that dividing our efforts by investigating more than one company, would not allow us to focus in sufficient detail on the domino effects that outsourcing can have on a singular institution. The main question of this project is “How could LEGO improve the Make-or-buy- decision and the relationship management when it comes to outsourcing”? In order to answer the main question, we must consider two sub-questions stemming from the main issue, namely: “How could LEGO improve the decision-making-process to outsource by taking more influencing factors into consideration?” and “What could LEGO have done differently in its relationship to the outsourcing vendor Flextronics”. We used the Case Study Research method to work on these questions. Doing that, we reviewed theories, which explained the phenomenon of outsourcing on a theoretical basis. After creating a theoretical framework and the database, we analyzed the case (LEGO) for parallels between the theories and their practical experience. Finally, we were able to drawn some conclusions to both the central and subsidiary questions initially posed. In summary, it can be said that LEGO did not take all aspects into...
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...signifying the increased importance for these countries of FDI, as well as the increased presence of multinational firms. Alongside the expansion of FDI have risen concerns regarding competition between countries or regions to attract FDI. After adopting new economic policy by government of India in July 1991 many foreign investors came in the Indian economic scene because the government of India gave many incentives to the foreign investors. So it is clear that government opened the doors of Indian market to foreign investors. With more companies operating internationally, the impact on various business functions and labour laws in India is becoming more pronounced. Globalization, and the need to attract foreign investment, inevitably leads to an attack on workers’ rights by diluting existing labour standards, as trans-national corporations concede to the demands of multinationals. This dilution of stringent labour standards and strong resistance to any strengthening of workers’ rights (which sometimes become an obstacle to competitiveness in the global...
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...Problems brought by strikes 7 Short term social problems 7 1. Affect companies’ normal daily operation 7 2. Reduce competitiveness of certain industry 8 Long term social problems 9 1. Reduce investors’ confidence 9 2. Increase turnover rate 10 Recommendations for Large Enterprises and SMEs 11 For Large Enterprises 11 1. Performance appraisal- Graphic rating scale 12 2. A clear promotion mechanism 13 3. Provide more channels for employees to voice out grievances 14 4. Envisage the requests of employees 14 Recommendations For Small and Medium Enterprises 15 1. Salary Review System to increase the mutual understanding 15 2. Envisage the working equity of employees 16 3. Encourage employees participate in the job redesign with manager 17 How can collective bargaining be adopted in Hong Kong? 18 Cultural limitations in application of collective bargaining power in Hong Kong 18 1.Low entry barrier for Labor Union in Hong Kong 18 2.Role and function of labor union 19 3.Foreseeable difficulties for small and medium enterprises’ employees 20 4.Inequality between employers and employees 20 Features of collective bargaining it should possess 21 Recommendations for the adoption of collective bargaining in Hong Kong 22 1. Define a clear list of interest members 22 2. The bargaining statement must be legally binding 23 3. Submit the financial record of every union to government regularly 23 Conclusion 24 References 25 Introduction ...
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...WHAT IS GLOBAL/INTERNATIONAL TRADE? Global trade is the exchange of capital, goods, and services across international borders or territories. In most countries, such trade represents a significant share of gross domestic product (GDP). While international trade has been present throughout much of history (see Silk Road, Amber Road), it’s economic, social, and political importance has been on the rise in recent centuries. Industrialization, advanced transportation, globalization, multinational corporations, and outsourcing are all having a major impact on the international trade system. Increasing international trade is crucial to the continuance of globalization. Without international trade, nations would be limited to the goods and services produced within their own borders. International trade is, in principle, not different from domestic trade as the motivation and the behavior of parties involved in a trade do not change fundamentally regardless of whether trade is across a border or not. The main difference is that international trade is typically more costly than domestic trade. The reason is that a border typically imposes additional costs such as tariffs, time costs due to border delays and costs associated with country differences such as language, the legal system or culture. Another difference between domestic and international trade is that factors of production such as capital and labor are typically more mobile within a country than across countries...
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...VICTORIOUS TEAM Countries For The Project for the Period 2011 : 1] China 2] India 3] USA Team Members and Students IDS : Nikita Bhivate A2604 ( U.S.A.) Li Jianwei A2394 ( China ) Tingting Hao A2319 ( India ) MBA 531 International Financial Management. Prof. Jayant Kanitkar. INTRODUCTION : Introduction Of China : During the period from 2007 to 2011, the whole world has been suffering from global economic recession and financial crisis. From US subprime to EU sovereign debt crisis, China, as the second largest economy in the world, experienced internal and external economic impacts. In the year of 2007, China’s economic development reached its pick. With the expectation of CNY appreciation, hot money flooded into China. As a result of this, the price of investment asset surged up sharply. The housing price tripled, and the Shanghai stock index reached to a historical level of 6300 from less than 3000 with in one year. The wealth effect from the high investment asset price stimulated consumption. Moreover, China was keeping its high net exports trading volume and fixed asset investment. The GDP growth rate exceeded 10%. However, the financial bubble broke in the US, and a chain reaction directly affected China. In 2008, all economic indictors shown that China’s development slowed down. Stock market can be regarded as the forecaster of economic. The Shanghai stock index dropped to 1900 from 6300. Affected by recession in international...
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...OPERATIONS MANAGEMENT REPORT ON 1 INDEX * Introduction ………………………………………………………………………………3 * 2 INTRODUCTION COMPANY PROFILE Volkswagen is a manufacturer of passenger and commercial vehicles. The company markets its cars under the following Brands: Volkswagen, Skoda, Bentley, Bugatti, Audi, Seat and Lamborghini. The company is headquartered in Wolfsburg, Germany and employs about 300,100 people. The Group operates 106 production plants in 19 European countries and a further eight countries in the Americas, Asia and Africa. Every weekday, 572,800 employees contribute to produce cars, to keep continuous relationships with customers, suppliers and partners in 153 countries. Volkswagen is a manufacturer of passenger and commercial vehicles. The company’s key products and services include the following: Products: Passenger cars Vans Light trucks Buses Pick ups Campers Brands: Volkswagen Audi SEAT Lamborghini Skoda Bentley Bugatti Some of the company’s data are given below: (* this data is for Volkswagen AG only) Revenues by Geography: Europe, Volkswagen’s largest geographical market, accounted for 44.1% of the total revenues in the fiscal year 2006. Revenues from Europe reached €46,211 million in 2006, an increase of 9.4% over 2005. Germany accounted for 27.2% of the total revenues in the fiscal year 2006. Revenues from Germany reached €28,544 million in 2006, an increase of 10.5% over 2005. North America accounted for...
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...RESEARCH REPORTED HERE IS PART OF A WIDER STUDY THAT SEEKS TO EXAMINE THE PRACTICES INVOLVED IN ENCOURAGING AND ENABLING EMPLOYERS TO ENGAGE WITH THE SKILLS DEVELOPMENT AGENDA. A SERIES OF EXPLORATORY INTERVIEWS AND ETHNOGRAPHIC OBSERVATIONS REVEAL POTENTIAL DISCONNECTIONS BETWEEN SKILLS POLICIES AT THE GOVERNMENTAL LEVEL AND WHAT ACTUALLY HAPPENS IN EMPLOYER PRACTICES REGARDING SKILLS DEVELOPMENT. ON THE ONE HAND, THE FORMAL EDUCATION AND TRAINING SYSTEM FOCUSES ON SUCH TARGETS AS THE ATTAINMENT OF NARROWLY-DEFINED OCCUPATIONAL STANDARDS, LEVELS OF COMPETENCE, AND QUANTITATIVE PERFORMANCE MEASURES LIKE COMPLETION RATES. ON THE OTHER HAND, THE SOCIALISED CONCEPT OF SKILLS DEVELOPMENT TAKES PLACE INFORMALLY AT THE WORKPLACE THROUGH ON-THE-JOB TRAINING AND MENTORING RELATIONSHIPS BETWEEN SENIOR AND JUNIOR EMPLOYEES. BOTH THE FORMAL AND INFORMAL SYSTEMS APPEAR TO CO-EXIST ALONGSIDE EACH OTHER, ALTHOUGH TENSIONS ARE MOUNTING IN TERMS OF CONFIDENCE THAT EMPLOYERS AND THE WIDER INDUSTRY PLACE ON THE EFFICACY OF THE FORMAL SYSTEM. Keywords: informality, skills development practices, skills policy, training and education. INTRODUCTION The UK construction industry faces an enduring problem of skills shortages. ConstructionSkills, one of the Sector Skills Council for Construction that has a remit of addressing skills needs for the UK construction industry, recently forecasted an annual average requirement of around 88,000 new entrants a year to meet expected workloads from...
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...3 Global challenges, need for R&I and economic dimensions of Digital Technology AUTUMN 2013 Copyright © ARTEMIS Industry Association & ITEA Office Association Permission to reproduce any text from this publication for non-commercial purposes is granted, provided that the source is credited. First edition, autumn 2013 www.artemis-ia.eu & www.itea2.org ISBN: 978-90-817213-2-5 5 Preamble This updated document1 is the joint result of the industry represented in the ARTEMIS Industry Association and ITEA and expresses the common industry ambition. Its creation was initiated by the ARTEMIS ITEA Cooperation Committee (AICC). The main goal of this update of the ITEA-ARTEMIS high-level vision 2030, version 2012 is to add a quantitative description of the impact of software innovation on revenues and labour. There are also other aspects of the impact of software innovation, like eco-systems, community building and standardisation. However these are not the focus of this year’s update. Disclaimer The trends and predictions presented in this document are based on publicly available sources. We rely on these sources, without independent verification of the information presented. The nature of this document is for a large part rather a compilation of existing material, than a reinvention of insights. The statements made by Roland Berger Strategy Consultants are based on assumptions held to be accurate on the basis of the information available. However, Roland Berger Strategy...
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