Transnational Management

Part 1

1. List the sets of macro forces that drive, constrain, and shape the industries in which entities compete globally.

There are three macros forces that drive, constrain, and shape the industries in which entities compete globally. They are

* Cross- market integration

* National Responsiveness

* Worldwide Learning

2. Does the SEPTE Model (see Important Class Information for this model) support this perspective? Explain.

SEPTE divide factors of the external environment into five categories which are: society, ecology, economics, technology and political. The three sets of macro forces aforementioned also influence these categories. For instance, a firm may become more responsive due to increased pressure from the government or because. Moreover, through better technology, MNEs are able to produce more and achieve greater economies of scales. Lastly, firms may be required to transfer technical knowhow to the host country or they may have the desire to participate in worldwide learning. As a result, I believe the SEPTE Model support this perspective.

3. List the four forces of change and give a brief explanation of each.

The four forces of changes are:

* Scale: because of technological breakthroughs, firms are able to produce more for less. New machinery and infrastructure that considerably lowered the cost of production, so everybody wanted access to that.

* Scope: because of the increase in production, firms now have more than they can sell in their home markets. As a result, they need other markets for their products.

* Factor cost: egged on by the lower production cost, firms tried to decrease other cost i.e. capital, labor, and resources. As a result, they look for other markets with cheaper workforce or supplies.

* Free trade: because of trade agreement such as WTO or NAFTA, there were fewer barriers to trade. Therefore, global trading was facilitated.

4. Forces for Local Differentiation and Responsiveness...