Program

: MBA

Semester
Subject Code Subject Name Unit number Unit Title Lecture Number Lecture Title

: IV
: MB0053 : International Business Management : 01 : Introduction to International Business : 01 : Introduction to International Business

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Unit-1 Introduction to International Business

Introduction to International Business

Objectives
The objectives of this lecture are to: Describe the evolution of international business Explain the concept of international business Analyse the difference between domestic, international and global business Explain the dynamics of globalisation

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Unit-1 Introduction to International Business

Lecture Outline

Introduction Factors Affecting International Business Elements of International Business Globalisation Summary Check Your Learning Activity

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Unit-1 Introduction to International Business

Introduction
International business is defined to be any business that crosses the national borders of the country for its establishment.

International business is growing at a rapid rate and is affected by various factors.

The elements of international business includes: Domestic vs. international business Advantages of international business Drivers of international business Available entry options to international business Globalisation is a process of business dealings in markets around the world.
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Factors Affecting International Business

Unit-1 Introduction to International Business

National economy Trade blocs

National culture

Marketing environment

International Business

Politics

Accounting practices

Human resources

Financial management

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Unit-1 Introduction to International Business

Elements of International Business

Domestic vs. international business
The differences between domestic and international business are based on the
following issues: Legal and regulatory framework Financial management

Trade barriers and tariffs

Accounting and taxation Culture Market forces

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Unit-1 Introduction to International Business

Elements of International Business (continued)

Advantages of international business
The benefits of international business are: Low cost production Strategic resources Large customer base

Competitive advantage
Diversify risk

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Unit-1 Introduction to International Business

Elements of International Business (continued)

Drivers of international business

Global marketplace Trading blocs Emerging markets

International
Changing demographics Business FDI policies

Technological innovations

Disintegrating trade barriers

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Unit-1 Introduction to International Business

Elements of International Business (continued)

Available entry options to international business
Export strategy

Licensing

Franchising

Foreign direct investment (FDI)

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Unit-1 Introduction to International Business

Globalisation
Features of globalisation
Globalisation is a process which consist of business dealings around the world in addition to the local and national markets. Business terminologies define globalisation as the worldwide trend of businesses expanding beyond their domestic boundaries. It is advantageous as it helps in promoting prosperity in the countries that embrace globalisation.

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Unit-1 Introduction to International Business

Globalisation (continued)
Competitive strategies used in globalisation

Multinational strategy

Global competitive strategy

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Unit-1 Introduction to International Business

Summary
International business is defined to be any business that crosses the national borders of the country for its establishment. The factors affecting international business includes national economy, national culture, politics, financial management, human resources, accounting practices, marketing environment and trade blocs.

There are various elements of international business such as advantages,

drivers and entry to international business.

The entry options to international business are export strategy, licensing, franchising and foreign direct investment.

Globalisation is a process where businesses are dealt in markets around the world in addition to the local and national markets.
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Unit-1 Introduction to International Business

Check Your Learning

1. Name any four drivers of international business. Ans. Four drivers of international business are:

Global marketplace
Emerging markets FDI policies Trading blocs

2. What are the entry options to international business?

Ans. The entry options to international business are: Export strategy Licensing

Franchising
Foreign Direct Investment (FDI)

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Unit-1 Introduction to International Business

Activity

Visit an international business organisation. Prepare a report on the elements of international business with respect to the organisation and the factors affecting international business.

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