IB0012 – Management of Multinational Corporations

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ASSIGNMENT

 

 

Note: Answer all questions. Kindly note that answers for 10 marks questions should be approximately of 400 words. Each question is followed by evaluation scheme.

 

 

Q.No Questions Marks Total Marks

 

1 Macro environmental forces are uncontrollable as compared to micro forces.

 

Answer : The environmental factors that are affecting marketing function can be classified into :

 

1) Internal environment and

 

2) External environment

 

External Environment of Marketing.

 

External factors are beyond the control of a firm, its success depends to a large extent on its adaptability to the environment.

 

 

2 Discuss the following theories of international trade:

 

a) Heckscher- ohlin theory

Answer : The Modern Theory of international trade has been advocated by Bertil Ohlin. Ohlin has drawn his ideas from Heckscher’s General Equilibrium Analysis. Hence it is also known as Heckscher Ohlin (HO) Model / Theorem / Theory.

 

According to Bertil Ohlin, trade arises due to the differences in the relative prices of different goods in different countries. The difference in commodity price is due to the difference in factor prices (i.e. costs). Factor prices differ because

 

 

b) Porter’s theory

Answer : Porter’s five forces analysis :

Porter identified five factors that act together to determine the nature of competition within an industry.  These are the:

1. Threat of new entrants to a market
2. Bargaining power of suppliers
3. Bargaining power of customers (“buyers”)
4. Threat of substitute

 

 

3 Discuss the challenges and opportunities of International management.

Answer : Challenges of International management:

 

International management consists of building an effective strategy, structuring an appropriate organizational design and managing people in a cross-cultural environment. Throughout these activities, companies must handle bureaucratic, technical, political, economic, linguistic, behavioral and cultural differences. Even if a small business does not pursue any international activities, a couple of these international challenges may show up while competing against or cooperating with a foreign company in its own domestic market or simply operating in a local community.

 

Language:

 

 

4 Compare the management styles in India and Japan.

 

Answer : Management styles in India

 

Management styles in Japan

Management styles and practices in China:

 

In Confucian philosophy, all relationships are deemed to be unequal. Ethical behaviour demands that these inequalities are respected. Thus, the older person should automatically receive respect from the younger, the senior from the subordinate. This Confucian approach should be seen as the cornerstone of all management thinking and issues such as empowerment and open access to all information are viewed by the Chinese as,

 

 

 

5 Explain the scope of comparative management

 

Comparative management’s scope

Answer : Comparative management is the study of various management principles, and how they apply from one situation to another. Such as with international companies. How these principles relate from one country to another. Management of international corporations is not a one size fits all scenario. There are many factors that will need to be taken into account. Among those are customs and social norms that vary from country to country. In some countries, care must be taken to address certain religious customs of the workforce.

 

 

Comparative management analyzes the extent to

 

 

 

6 Write short notes on:

 

a)International advertising

Answer : Definition of International Advertising

 

International advertising entails dissemination of a commercial message to target audiences in more than one country. Target audiences differ from country to country in terms of how they perceive or interpret symbols or stimuli, respond to humour or emotional appeals, as well as in levels of literacy and languages spoken. How the advertising function is organized also varies. In some cases, multinational firms centralize

 

 

 

b)Transfer pricing

Answer : Transfer pricing is a profit allocation method (the other being formulary apportionment) used to attribute a multinational corporation’s net profit (or loss) before tax to countries where it does business. Transfer pricing results in the setting of prices among divisions within an enterprise. Transfer prices are charges for goods and services between controlled (or related) legal entities within an enterprise. Legal entities considered under the control of a single corporation include branches and companies that are wholly or majority owned ultimately by the parent corporation. Certain jurisdictions consider entities to be

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