Global Dimensions of Business Business 187 Prof. Robert Chapman WOOD 1-1

Global Dimensions of Business  Business as it operates globally across vastly different cultures and institutions.

Globalization  ‘The shift toward a more integrated and interdependent world economy’  Globalization is significantly changing life for the majority of the world’s people (including us)

Why study global business?  More and more business is international Before the recession, US exports were growing 6% a year while the economy overall grew 3%  Northern California depends heavily on international business  At San Jose State, we’re a very international community Look around the room!

 International business is different Different cultural experiences Different rules of the game Different mechanisms – procedures for exporting, importing, setting up units in foreign countries Surprising principles for business strategy

Definitions  International business – any business or commercial transaction that involves two or more countries  Global business – business activities that treat the world as a single market All global businesses are both ‘international’ and ‘global’

Importance of international business  International business is transforming the world It can transform the world for the better  The fastest growing economies are the most populous countries China India Others – Indonesia, Vietnam, coming up fast

 Hundreds of millions of people are living better today than 10 years ago  But we’re learning that billions are not being reached Are average people in India living better? Are people in China actually happier?

When east Asia started developing, ordinary people gained  Japan  Korea  Taiwan  Singapore  growth in the 1980s in China  It is possible for development to benefit everybody

Learn international business to figure out our roles in the world  Think about how we can make better ways of living for everyone

What should be globalized?

Optional assignment due the last day of class  Write a self-evaluation of your class participation You can attach any  notes you prepared for case discussions  correspondence you had with me  anything else that may help me evaluate how well you participated You can tell me what class participation grade you think you deserve

 You will also have a chance to give a presentation on an international business topic A country? Perhaps your country or your ancestors’?

The packet is available at Maple Press  481 East San Carlos St.  … in the block east of 10 th St. Just tell them you want the packet for Business 187, Prof. Wood  You must have the packet! Where I could give links to an article on the Web, it isn’t included in the packet

Recommended supplementary reading  The New York Time  Fortune  Wall St. Journal  The Financial Times (of London)  Bloomberg.com  theatlantic.com

Buy a college-level dictionary  It’s essential for your career  You’re too advanced now for a “learner’s dictionary”

Scary times  Both bad and good things are happening Good: growth, new opportunities, people emerging from poverty Bad: pollution, layoffs, lying executives, war Really Bad: Huge recession  This semester is designed to provide tools that help you create more of the good and get rid of some of the bad

What is ‘International Business?’  All commercial transactions between two (or more) countries ‘Commercial transactions’ = the buying and selling of goods and services Private (between companies) Public (involving a government)

Why Engage in International Business  Expand sales Volkswagen (Germany) Ericsson (Sweden) IBM (United States)  Acquire resources Better or cheaper components, services, products Foreign capital Technologies Information  Minimize risk (doesn’t always work) Take advantage of the business cycle for products/services Diversify among international markets

Why International Business is Growing  Liberal government policies on trade  Rapid improvement of technology Transportation is quicker while costs are lower Communication enables control from afar  New institutions to support trade Examples: Global banking Federal Express  Consumer demand  Companies learning from each other