Submitted by: Submitted by sjawhad
Views: 1316
Words: 59265
Pages: 238
Category: Business and Industry
Date Submitted: 10/01/2012 01:18 PM
bar3711x_ch01_001-112.qxd
1/29/10
3:27 AM
Page 1
CHAPTER 1
Expanding Abroad:
Motivations, Means, and Mentalities
In this chapter, we look at a number of important questions that companies must resolve
before taking the leap to operate outside their home environment. What market
opportunities, sourcing advantages, or strategic imperatives drive their international
expansion? By what means will they expand their overseas presence—through exports,
licensing, joint ventures, wholly owned subsidiaries, or some other means? How will
the attitudes, assumptions, and beliefs that they bring to their international ventures
affect their chances of success? Before exploring these important questions, however,
we first need to develop a definition of this entity—the multinational enterprise
(MNE)—that we plan to study and develop some sense of its size and importance in the
global economy.
This book focuses on the management challenges associated with developing the strategies, building the organizations, and managing the operations of companies whose activities stretch across national boundaries. Clearly, operating in an international rather
than a domestic arena presents managers with many new opportunities. Having worldwide operations not only gives a company access to new markets and low-cost resources, but also opens up new sources of information and knowledge and broadens the
options for strategic moves the company might make in competing with its domestic and
international rivals. However, with all these new opportunities come the challenges of
managing strategy, organization, and operations that are innately more complex,
diverse, and uncertain.
Our starting point is to focus on the dominant vehicle of internationalization, the
multinational enterprise (MNE), and briefly review its role and influence in the global
economy.1 Only after understanding the origins, interests, and objectives of this key
actor will we be in a position to...