Player in Business

Who are the players in the international business arena? How can you tell the degree of a firm’s internationalization? Do you think that a higher degree of internationalization will necessarily lead to higher corporate performance? Why or why not?

The players in the international business arena consist of multinational enterprises (MNEs) and small and medium-sized international enterprises (SMIEs).

An MNE is a large company with substantial resources performing various business activities through a network of subsidiaries and affiliates located in many countries around the world. A multinational enterprise is more powerful than an economic investor alone. A multinat with operations in a given country can promote social and economic welfare, improve living standards, and foster such human rights as freedom of association. Johnson & Johnson, Nokia, Samsung, Nestle, IKEA and Wal-Mart are the example of an MNE. McDonald's is an example of a multinational enterprise which is based in Chicago, Ill. but also has offices and production operations in Canada, Russia, India, China and Taiwan. And, of course, it has thousands of retail operations worldwide. However, due to advancement in information technology and a network distributors, many MNEs today have originated from developping and emerging economics. Examples of these include Lenovo, Wipro and Petronas.

Most definitions of SMIEs mainly about the number of employees employed by the company in addition to the cross-border nature of its business. In other words, small and medium-sized enterprises (SMEs) are non-subsidiary, independent firms which employ less than a given number of employees. This number varies across countries. The most frequent upper limit designating an SME is 250 employees, as in the European Union. However, some countries set the limit at 200 employees, while the United States considers SMEs to include firms with fewer than 500 employees. Most countries rely on SMIEs to spearhead the local...