Define International Business.

Is it true that international business has to face greater amount of complexities than the domestic business. Discuss with suitable examples International business involves commercial activities that cross national frontiers. It concerns the international movement of goods, capital, services, employees and technology; importing and exporting; cross-border transactions in intellectual property (patents, trademarks, know-how, copyright, materials etc) via licensing and franchising; investments in physical and financial assets in foreign countries; contract manufacture or assembly of goods abroad for local sale or for export to other nations; buying and selling in foreign countries; the establishment of foreign warehousing and distribution systems; and the import to one foreign country of goods from a second foreign country for subsequent local sale. Therefore international business has to face greater amount of difficulties since the international business are operated outside the domestic country and the environment will be much more different than the home country. International business has to know the entire environmental factor in detail such as Political, Socio cultural, Technological, Economical Environments. For example; McDonald one the biggest multinational food chain operated worldwide failed their product initially in India. The product of McDonald was success in the western countries so with the same mindset McDonald expanded their food chain in the south Asia. The product of McDonalds was hamburger and they use beef in their burgers. According to the Hindu culture, beef are considered as goddess so while McDonalds entered the market the product was failure and even they have to review their strategy. Luckily McDonalds do not have to face serious problem. Therefore these kinds of issues are needed to be handled very carefully while entering into different market. Different strategy has to be used and implemented in different market and situations. International business is not only limited to the national market they have to go beyond the limitation and keep themselves open and adapt according to the environmental requirement. The transition from a domestic company to an international company is tedious, requires enormous amounts of market research and a lot of luck. It is the responsibility of the international manager to facilitate all of these changes to ensure the best location for their company to prosper. There are numerous characteristics that are prerequisites to the success of an international manager. These managers are typically active, aggressive, and display a high

degree of international orientation. Their global awareness is superb and is culturally sensitive to people around the world. Above all else an international manager must exhibit a strong commitment to cross borders for commerce, because transforming a company into a global player is an intensive long-term goal. Apart from Cultural, technological advances, on the one hand, enable management to direct, coordinate, and control operations on a much broader and diverse geographic scale and scope than previously possible. Yet at the same time, such advances add further complexity, as management has to master the tools and skills required to handle the burgeoning international infrastructure. As the geographic scope and scale of operations extends further and further, management is faced with the task of directing and controlling diverse and far-flung activities at various stages in the value chain, often in widely divergent environmental contexts. With trends toward regional market integration, management systems are established to direct and coordinate market operations within a region, and to provide an intermediate link between corporate headquarters and local management. At the same time, organizational links between functions in each stage of the value chain are added at a global level to ensure the transfer of ideas, information and experience across geographic areas and to exploit potential synergies worldwide. Similarly, as customer markets become more dispersed, establishment of linkages with customers and suppliers becomes increasing critical in order to coordinate supplying and servicing these markets rapidly and efficiently, and to compete effectively in global markets.

Sometimes links are established with other organizations, in some cases competitors, to exploit newly emerging opportunities in specific product markets or parts of the world. Strategic alliances may be formed with firms to provide desired geographic market coverage, or skills and resources needed to implement a given strategy. In other cases, temporary networks are formed by far flung partners (suppliers, customers, and competitors) sharing costs, skills, access, and operations in global markets through electronic links, utilizing the latest information technology, to take advantage of a specific market opportunity. These networks are fluid and flexible, evolving in response to changing market conditions. Once an opportunity is met, or disappears, so the network will disband.