Use of global supply chain functions of (a) logistics and (b) purchasing to strategically leverage the global supply chains for a manufacturing company producing mobile phones.(International Business)

The optimization of the global supply chain helps the company to get a competitive edge by achieving its objective. The company that has focused on low-cost strategy would get it through the mass customization and economics of scale and those that have aimed for differentiation would be able to innovative itself in a distinctive way by choosing the well acknowledge sustainable and unique attributes and methodologies. The effective global logistic and purchasing by mobile company reduces the cost, improves the efficiency, delivers the product at the right time and satisfies the parties involved in the supply chain.  Indeed, the purchasing and logistics are intertwined to each other and its good harmonization will create competitive and comparative advantage.

The mobile phone requires numerous parts in its manufacturing process, i.e. mobile screen, battery, charging point, rare earth material et cetera and the global purchasing facilitates manufacture to choose low-cost raw material without compromising the quality. Apple though is an American company, procures its phone casings from China, from Taiwan they procure memory modules and from Japan the company import ceramic capacitor (Seth, 2018). The global supply chain has facilitated or facilitates the phone manufacturer to choose either of the following procuring strategies.

·       Outsourcing: the phone company here procures the parts from other suppliers other than itself.

·       Offshoring: the phone company manufactures and procures the phone parts from the company outside of the country

·       Co-sourcing: it provides the cost cut by leveraging the third part resources.

·       Acquiring company for vertical integration to get hassle-free manufacturing.

The decision of choosing either of the purchasing strategies as listed above for the phone manufacture depends on the factors like

o   The long-term availability of resources,

o   Support of local/state regulation (Amazon slashed its HQ2 due to the opposition from the local communities (CNN, 2019))

o   Availability of workforce et cetera

Similarly, the logistics will allow the seamless flow of the procured raw materials and the flow of finished products.  Some of the benefits of global logistics that could be availed by the phone manufacturer are listed below:

·       Setting a global distribution center: the global distribution center or a warehouse construction in a location that will be nearest to the major markets. It will help in the reduction of the lead time to reach the product in the market. Amazon.com also has 75 fulfillment centers and 25 sortation centers across the USA through which it delivers the products to its globally disbursed customers.

·       Efficient inventory management: the global logistic will emphasize in holding the optimum level of inventory of the raw materials. The higher carrying and ordering cost makes the phone uncompetitive.  The well-managed inventory management finds out economic order quantity (EOQ) which is the best possible amount to hold and order.

·       Reverse logistic helps in the collection of phones that would be no more used by the people. The well manifestation of the global supply chain added with informational technologies will help to collect those phone and could be reused, remanufactured or recycled.

Hence, the optimization of the global supply chain through efficient purchasing and logistics will be a boon for a company. It will economize the forward and backward linkage of mobile manufacturing and also will make the company sustainable by focusing concerns on environmentalism.

References

CNN. (2019, February 14). Amazon cancels plans to build New York headquarters. Retrieved from www.cnn.com: https://www.cnn.com/2019/02/14/tech/amazon-hq2-nyc/index.html

Seth, S. (2018, December 5). 10 Major Companies Tied to the Apple Supply Chain (AAPL). Retrieved from www.investopedia.com: https://www.investopedia.com/articles/investing/090315/10-major-companies-tied-apple-supply-chain.asp

"Countertrade", Scenarios its use might increase further by 2020 and or decline.(International Business)

Countertrade is an agreement between the parties where the trade of goods and services happen in an absence of the money, i.e. the trade occurs with an exchange of goods or services in reciprocation. Nearly 15-20% of the world trade is covered by the countertrade mechanism (Seyoum, 2009).

The countertrade is beneficial when there are no strong and sufficient means to settle trade transactions financially, the parties involved may either exchange or swaps their goods and services ultimately bettering off the parties with an increased level of production as well as consumption.  And, I see these as a humanitarian mechanism to support citizen in the economics havocked by political and economic crises. This may appear in the form of a currency crisis and monetary instability. The Venezuelan currency has all most lost its purchasing power, it could not be used as a mode of international trade anymore, but the country is one of the largest producers of the crude oil, here it can trade its necessities with its trading partner in exchange of the oil. Currently, the country is in talks with India to barter its oil (Retures, 2019)

Except in the case of the political and economic crises, it can also be used in good faith to create a win-win scenario. For example, a company can import raw material from another country setting an agreement that the latter one has to import 35% of the finished goods that are made from them, here in doing so both the parties are benefited.  PepsiCo traded drink concentrate for Basmati rice in India and for silk and mushroom in China, the mushroom was used in PepsiCo Pizza Hut chain and the silk was dyed and sold for the profit (Seyoum, 2009). Similarly,  to lock the sale of $250 million worth of Apache helicopter to the UAE, the US aircraft maker McDonnell Douglas has agreed to equip the Arab sheikdoms against a perky airborne enemy: the whitefly (Seyoum, 2009)

Some of the scenarios which can expedite the countertrade are listed below:

·       If the conventional means of payment becomes difficult, costly or non-existent     

·       If the countries want to settle transaction through the exchange of goods and services ultimately leading to promotes one’s export industry.

·       If countries lack the hard currencies and foreign exchange reserve

·       And if the countries do not have as easy access to the forex market.

Whereas the following scenarios may decrease over-reliance on countertrade:

·       If the countries have strongly defined monetary system

·       If there is less chance of happening of the political and economic cult that may dampen the value of currencies

·       If the countries work together to decrease the barriers of the trade.

The countertrade has played a pivotal role in the occurrence of the global trade, it has also become a kind of marketing strategies between the nations where the parties contractually agree to deliver some non-financial facilities and transactions. And it could be a cent percent barter of goods and services or a mix of barter and cash.

References

Retures. (2019, February 11). Venezuela's PDVSA seeks to barter its oil with India. Retrieved from www.finance.yahoo.com: https://finance.yahoo.com/news/venezuela-open-barter-trade-india-095320313.html

Seyoum, B. (2009). Export-import Theory, Practices, and Procedures. New York: Routledge.

The need for control over foreign operation varies with the firm’s strategies and core competencies.and the implications for the choice of entry mode(International Business)

Whenever the company plans to go for the foreign operations it has to be equally creative as well as sensitive in protecting itself from its competitors. The euphoria of first-mover advantage may often be taken by the competitor with its second mover advantage. Expanding the business is not only about gaining the opportunities, but it is also coming across the multi-dimensional threats that may come across. Indeed, lots of company that has done their best domestically had faded away when they went foreign boundary.  Walmart lost in Germany and Best Buy was too big in the United Kingdom (Seale, 2015).

If the competitive advantage of the company is based on the technological know-how or the new kind of innovation that other firms are also looking for, it is better to avoid licensing and joint ventures. Mitsubishi was the pioneer in car engines, with its plans to expand the business in the 1980s, it licensed to Hyundai (DeMatio, 2008), ironically now Hyundai is far more ahead than Mitsubishi. Whereas, if the company is in infancy state, lacks enough funds to acquire the firm in foreign than exporting could be a viable option for the company; globally, most of the SME’s uses the export mechanism.

Coco-cola is a multi-national company and it expands through greenfield investments. It does not like to disclose its century-long drink formulae, if the company had expanded through licensing or franchise, it would have lost its strategy. The subsidiary has allowed the company to tailor its activity as per the localized demand if the company has a strong international brand, high financial capital, and technological know-how, Greenfield is best to incorporate. 

In contrast, Walmart rather than opening its own subsidiary acquired Indian e-commerce giant Flipkart for the expansion of its business in India, the grocery business indeed does not entail technological innovation that should be protected, its management driven. So, the acquisition will hold a good for Walmart to use its management expertise to compete in the world second largest populous country and countervail competitors like Amazon which is also eying Indian grocery market. 

Hence, the entry strategy to be adopted by the company depends upon the various political, economic, legal, cultural and social factor. Always greenfield would not be a worthy investment, sometimes exporting is a necessity and sometimes acquisition will be better off, indeed the global expansion is reconciling the company’s vision through the resources it has in the most efficient and optimum manner.

References

DeMatio, J. (2008, May 8). Hyundai: from borrowing engines from Mitsubishi to providing them for Mercedes-Benz. Retrieved from www.automobilemag.com: https://www.automobilemag.com/news/hyundai-engines/

Seale, A. (2015, January 27). Seven epic fails by businesses that tried expanding into foreign markets. Retrieved from www.firmex.com: https://www.firmex.com/thedealroom/seven-epic-fails-by-businesses-that-tried-expanding-into-foreign-markets/

Organizational issues while implementing transnational strategy(Global Business)

The transnational strategy is the tactics to be assumed when the degree for local responsiveness as well as the price sensitivity is high.  The companies come across the price sensitivity through gaining economies of scale and location scales which comes along due to the experiences effect manifested in their positive learning curve and for the local responsiveness the company localizes its strategy.  In comparison to other strategies like international and local responsive strategy, it is challenging because often the direction of cost and local responsiveness are tradeoffs.

At one extreme a centralization is required to maintain the efficiency for the cost minimization whereas a decentralized approach is required for the local responsiveness. Also, the localization issues come from the differences in culture, communication process, level of trust, consumption patterns, language barrier. Walmart though succeeded in India and China, it was not able to localize well in the Germany market, the German consumer preferred small neighborhood stores than impersonal chain which consumes a lot of time in shopping (Macaray, 2017), here though Walmart came across the cost sensitivity of Germany market, it cannot mold itself well with the local expectation.

But, MacDonald’s entry to India has been phenomenal apotheosis of transnational strategy, it revised its menu, eliminated beef items and added vegetarian burgers, the strategy ran well, and Mac is a big fast food chain in India. A similar case of successful strategy was adopted by Caterpillar to compete with low-cost competitor Komatsu, Caterpillar redesigned its product so that it can use identical products in few large manufacturing facilities(to gain economies of scale) and came with the product feature addressing the local requirements(as there could be differences in government regulations across the countries) (Hill, 2011).          

Hence, it would not be wrong to say that the transnational strategy is different and challenging than other global business strategies, but it is of core importance for the global companies and ultimately the transnational is proven to be a sustainable one.

References

Hill, C. W. (2011). International Business : Competing in the Global Market Place,8E. New York: McGraw-Hill Irwin.

Macaray, D. (2017, July 14). Why Did Walmart Leave Germany? Retrieved from www.huffingtonpost.com: https://www.huffingtonpost.com/david-macaray/why-did-walmart-leave-ger_b_940542.html  

The reasons of raising global capital market and its future trend(International Business)

The global capital market which comprises of investor, seeker of the financial fund and intermediating institution is on rising. The globalization and liberalization have been a major factor to bring all diversely scattered resources into the mainstream of global financial platform and disruptive technological innovations along with liberalization have facilitated the flow of funds across the borders. The global stock market raised from $ 3600 billion in 1990 to $33,913 billion in 2012 and in the same way the international bond market raised from $3515 billion in 1997 to $21979 in 2012 billion (Hill, 2011) and the global stock market alone reached a record of $76.3 Trillion (Baccardax, 2017).

In the future, I think the growth will be even higher, Accenture in their report entitled “Technology for Digital Capital Market in 2022” has emphasized the amalgamation of technology as more disruptor for such ramification. It would be through intelligent and automated technology, big-data analysis along with open and accessible platforms.  These technologies are making financial transaction real time and are running 24*7.  On the other hand, liberalization and deregulation are providing ample opportunities to individual investors as well as to the corporate investors move across the border. The systematic, tech-savvy real-time stock exchange platforms like NYSE(USA), HKEK(Hongkong), LSE(London) are helping the free and fair flow and transfer of the primary and secondary capital.

Except this, multi-national banks like JP Morgan, Bank of America, Standard and Charters, Soft Bank et cetera are globally collecting and investing in promising projects along with bond equity markets.  With the members count reaching 162 countries in WTO, which comes with the promises to open financial market in the global arena, I can fell that there will be more flow of funds and rise in the value of the capital market.

Seamlessly, need for higher innovation to come across the expectation of global customers, the rise of the fourth industrial revolution, the use of artificial intelligence, blockchain technologies, new mode of virtual currencies like cryptocurrencies, all are creating a need for investment in the gigantic level which is only possible through the well matured and maintained capital market.

Bibliography

Baccardax, M. (2017, July 14). The Global Stock Market Is Now Worth a Record $76.3 Trillion - And That's Terrifying. Retrieved from www.thestreet.com: https://www.thestreet.com/story/14229200/1/global-stocks-are-now-worth-more-than-the-global-economy-and-that-s-worrying.html

Hill, C. W. (2011). International Business: Competing in the Global Market Place,8E. New York: McGraw-Hill Irwin.

Dilemma and paradox of fixed and floating exchange rate regime(International Business)

In the fixed exchange rate regime, the exchange rate between the home and trading countries’ currencies are kept constant, the rate is kept fixed by the regulatory for which they constantly buy or sell the foreign reserves to maintain that exchange rate.  Whereas in the context of the floating exchange rate regime, the exchange rate hovers as per the demand and supply of the currency in the forex market.  Principally, whenever the demand for the currency increases, the value of currency appreciates and when the supply increases in the forex, it depreciates.

And, as per my understanding, the exchange rate regime depends upon the state of the economy as well as the fiscal and monetary objective set by the country.  The bigger economies like the USA, the UK apt for floating exchange rate regime as it helps in automatic stabilization of the currency rate, for example, if there is a deficit(trade deficit) in the balance of payment, then it will depreciate the currency and make its export cheaper and import expensive, this will ultimately restore the balance of payment to the equilibrium and in the same way the government can control the monetary policy of the country, whereas, the rate changes daily in the floating regime which encourages speculation in the forex market. 

In regards, the fixed exchange creates financial stability in international trade and minimizes the speculations, but it compels the country to hold a huge volume of foreign currency to play when required to maintain the fixed rate. As stated by the term, “Trilemma”, also called an impossible trinity, a country cannot achieve the free flow of capital, a fixed exchange rate, and independent monetary policy simultaneously, at each time they have to choose two letting the third one go (Kenton, 2018).

My country has pegged its currency with the Indian currency at 1.6 Nepali currency = 1.0 Indian currency. Since 60% of our international trade occurs with India, pegging has helped us to nullify the currency speculation risk, my country is a net-importing country and we are already in billions of dollars trade deficit, if we had the floating rate regime and if our currency has depreciated against the Indian currency further, then the deficit would have skyrocketed. Except, Indian currency, we have a floating rate regime with other countries.  But as stated above in impossible trinity, we do not have hold in our monetary policy.  Similarly, the Chinese government has pegged its currency with the USA currency which has indeed supported the Chinese export by devaluating its currency against its USA dollar (Bovaird, 2018) but the American government is blaming China for devaluating its currency creating currency war between the countries.

Hence, the fixed and floating exchange rate regime have their own pro and cons. Depending on the economic, political, socio-cultural and trade status of the country, they choose the currency rate regime. The model that fits best for one economy may be impractical for another and we should also take care of the rule of impossible trinity.

Bibliography

Bovaird, C. (2018, October 19). Why Is the Chinese Yuan Pegged? Retrieved from www.investopedia.com: https://www.investopedia.com/articles/forex/030616/why-chinese-yuan-pegged.asp

Kenton, W. (2018, February 28). Trilemma. Retrieved from www.investopedia.com: https://www.investopedia.com/terms/t/trilemma.asp

Should government consider human right of host country before granting preferential trading rights?(International Business)

Preferential trading right is a preferential treatment given to members of the group in the form of reduced barriers (tariff or non-tariff) which it would not have received otherwise if it were out of that bloc. And definitely, it is a big yes from my side that the country should look at the current status of human right with its trading partners before legitimating any trade agreements.  The human rights are the basic rights and freedom to which all the human are entitled, it comprises domains like freedom of expression, gender equality, right to information, race equality, women’s right et cetera.  And the violation of human rights may come due to the vicious circle of poverty, prevalent illiteracy, lack of infrastructure, unstable government, corruption and taboos along with ignorance which signifies not a good place to do business so forth.

The home country(the government which is giving the preferential right) can help eradicate the poverty, stop child labor, remove corruption and protect women rights in the host country and ultimately make the overall trading mechanism-free, fair and transparent.  It is often seen, these are strictly guided by the developed nations to it's developing and least developing trade partners. The European Union banned the import of carpets and garments from Nepal after knowing the use of the child as the labor in the garment industry (Clark, 1996), these pressured Nepalese government to abolish the unregulated practice of child labor, now Nepal has profoundly crafted “Rugmark” brand which testifies the products are child labor free.  In the same way, the business sanctions to North Korea and Venezuela from international human right watchdogs; UN is putting pressure through sanctions on these countries dictators to respect human right (Merchant, 2019).  The USA has strongly vocal against the human right issue in China, these have pressured China to take care of various issues like an intellectual property right, business rights, subsidies which are creating a geopolitical disturbance.

On the other hand, it is often impliedly seen trade requirements and protocol are used by the developed nations as the trade negotiations tools, to discourage the exports from the developing countries which otherwise will dominate the world with cheap production.  China by the means of welcoming foreign direct investments from developed countries like the USA, Japan is infringing their intellectual and property rights.  And also, often, the preferential trading rights comes with limited time period and uncertainty, after the end of multi-fiber trade agreement given to Nepal by the USA, the overall garment industry jeopardized, billions worth of investment ruined.

But equal cautions have to be taken, in the vide to maintain human rights, countries are blatantly using sanctions. And sadly, I think, it would not impact the regime a lot, it even degrades the life of innocent citizens.  US sanctions on North Korea, Russia, Venezuela has negatively impacted ordinary citizens rather than the regime.

Hence, the government of the home country should see the human right condition of the host country before providing the preferential rights, but equal care has to be taken as some time the uncertain and stern measure put forth by the home country even can degrade the condition of the preferential rights receiving countries.

Bibliography

Clark, C. S. (1996, August 16). Child labors and sweatshops. Retrieved from www.library.cqpress.com: https://library.cqpress.com/cqresearcher/document.php?id=cqresrre1996081600

Merchant, K. F. (2019, January 15). New Year Sanctions Roundup: Where Do We Stand? Retrieved from www.natlawreview.com: https://www.natlawreview.com/article/new-year-sanctions-roundup-where-do-we-stand

"Transition from Linear to Circular Economy"(Westcliff International Journal of Applied Research, Volume 2, Issue,2, Fall 2018)

Potential cost of adopting free trade regime and government action to reduce such costs(International Business)

The paradox of free trade could not be declined, though world trade organization (WTO) has played a pivotal role to globalize the global trade by reducing the tariff and non-tariff barriers, sadly the benefits from the free trade regime has not been symmetrical.  While at one spectrum, the countries with an opulence of resources are bettering-off and those who lack resources and capabilities are losing significantly due to their inability to compete in global trade platform. Some of the cost that comes with free trade are: -

Over-dependence: Free trade conceptualized in the exporting the goods in which we have a comparative advantage and importing the goods in which we lack the same.  But this dependence could be detrimental whenever the situation between the countries worsen-offs. The country (Nepal) ran out of medicines, schools got closed (due to lack of diesel to run bus), national inventory for oil plunged resulting rationing (oils were imported from Indian border) (BBC, 2015) when the border between India and Nepal got closed.  Similarly, the tussle between the USA and China has gone way far beyond and is impacting S&P 500 and Dow Jones often. The free trade regime between the countries has gone so deep into their economies that any protectionist move from any country, literally could jeopardize the overall global trade scenario. The cost of raw material has spiked due to the import tariff levied by Trump administration which has ultimately made the cost of living higher in the USA.

Currency war and its implication: The free trade regimes settles with the final payment of the trade between the countries. Since most of the trade happens in the US dollar denomination, the exchange rate volatility could be detrimental to the importing economy as they have to pay more and also the goods become dearer to them. As per (Boz, Gopinath, & Palgborg-Moller, 2018) 1% appreciation in the US dollar against all other currencies in the world predicts a 0.6-0.8% decline within a year in the volume of the total trade between the countries in the rest of the world.

Closer of local firms:

Basically, the infant industries of the least developed and developing countries are not able to compete with the products and services from industrialized and developed countries.  The initiation of Wal-Mart in India led to the closure of existing local retail stores (Naidu-Ghelani, 2012), often the local firms are not able to compete with the economics of scales, technologies that the MNC’s have.

In general, when the government comes within the track of the free trade regime, they are supposed not to be biased with their industries. Indeed, they have to treat the import from other countries as they would have treated their own products. But in contrast, the government of the countries uses various tariff and non-tariff barriers to protect their local industries. To protect its agriculture industries, the Indian government has heavily subsidized it, it includes banquet tax exemption, subsidies on fertilizer, cheap corps insurance, high tariffs to block food imports (The Economist, 2018), similarly Japan has also protected its automobile industry will strict non-tariff barriers to the auto imports.

In reality, the global business has become a kind of suspense drama, it is intricate and it is not business alone, its political, economic, socio-cultural.  Countries use various trade and non-trade tactics to manure international businesses. And all these go to add up the stack of trade disputes on the table of WTO claiming various countervailing measures like anti-dumping laws to protect the negativism of free trade.

Bibliography

BBC. (2015, December 12). Nepal blockade: Six ways it affects the country. Retrieved from www.bbc.com: https://www.bbc.com/news/world-asia-35041366

Boz, E., Gopinath, G., & Palgborg-Moller, M. (2018, February 11). Global trade and the dollar. Retrieved from www.voxeu.org: https://voxeu.org/article/global-trade-and-dollar

Naidu-Ghelani, R. (2012, November 9). Why Are India's Retailers Afraid of Wal-Mart? Retrieved from www.cnbc.com: https://www.cnbc.com/id/49605760

The Economist. (2018, July 12). India’s government claims to subsidize farmers but actually hurts them. Retrieved from www.economist.com: https://www.economist.com/asia/2018/07/12/indias-government-claims-to-subsidise-farmers-but-actually-hurts-them

Understanding business practices in an Islamic country and Christian country.(International Business)

Definitely, the business practices in Islamic and Christian countries differ drastically. The divergences appear in every spectrum of the business deeds, i.e. from business settings, dress codes, business etiquettes, focus on business verse personal values, hospitality, time management. Though both religions are monotheistic, their values, traditions, religious practices, beliefs, and social and cultural sanctions differs a lot.  Indeed, whatever the difference be, both religions are against bribery, fraud, and cheating, discriminations, corruption and are strongly concerned about the rights of employees, customers, and stakeholders.  Since Islamic countries are theocrat and to take an example of US, it is ruled by the “common law”, the differences manifest.

The point to be noted is, except religion, other moderating variables also come in action to impact the business environment. Hasty generation could not be made alone on the basis of religion, therefore following testaments are just general inference made.

Life prioritization.

Islamic countries are group oriented whereas the Christians are individualistic. Running the Hofstede cultural test, Unites States scored 91, the UAE 25, Pakistan 14 and Nepal 30 in individualism (“Country Comparision”, n.d.). We can also induce, more the country is economically less equipped it favors groups as it fosters security. Pakistan ranks lower in individualism in comparison to the UAE. The businessperson in the individualist countries is more objective, result oriented, direct whereas Islamist focuses on the longterm relationships and often carries subtle meanings in their actions and business deeds.  As per (Cukur, Guzman, & Carlo, 2004), collectives are more conservatives in values and more religious than the individualistic countries, moreover they are lower on the openness to change.

Gender consciousness:

Islam focuses on core caring and protection of feminism in their own way which could be reprehensible for Christians. The code of dress also differs, the Islamic traditions have long body hiding apparels which in fact is good enough to get protected from the direct sunlight in the extreme heat. Though it is often seen, feminism is suppressed, the educated Islamic countries are coming up with more profound liberalization and also are being equally sensitive to their theocratic culture.

Financial dealings:

Whereas the financial deals in context of Christians are entitled to have interest in their investment, in contrast, the Islamic business or banks are not allowed to charge interest in their investment (Lagace, 2002) but another way around the return on investments are made as a profit sharing.

Contracts and business deals:

You have a good business track record, high cognitive skills, and enough resources, than its more than enough to have a business deal in capitalist Christian country but in Islam, they believe themselves to be the agent of the Allah, so protecting Allah’s property might not have any contractual and business dealing with other if another party are self-centered, over-aggressive and focuses more on self than for group.

Hence the cultural differences between a Muslim country and the Christians will cause business practices to differ dramatically since the “Message of Islam” and “The Gospel of Jesus” priorities and practices are different. But except these religious and cultural independents variables, other mediating variables like level of education, openness to FDI, level of economic development, the vision of the country, the level of poverty, the existence of sectarian strife, the chance of civil war should also be taken into consideration while having the business approach.

Bibliography

Country Comparision. (n.d.). Country Comparision. Retrieved from https://www.hofstede-insights.com/country-comparison/nepal,pakistan,the-united-arab-emirates,the-usa/: https://www.hofstede-insights.com/country-comparison/nepal,pakistan,the-united-arab-emirates,the-usa/

Cukur, C. S., Guzman, M. R., & Carlo, G. (2004). Religiosity, Values, and Horizontal and Vertical Individualism-Collectivism: A Study of Turkey, the United States, and the Philippines. The Journal of Social Psychology,144(6), 613-634.

Lagace, M. (2002, February 04). How To Do Business in Islamic Countries. Retrieved from www.hbswk.hbs.edu: https://hbswk.hbs.edu/item/how-to-do-business-in-islamic-countries

A democratic political system is an essential condition for sustained economic progress.(International Business)

The democratic political system emphasizes in the free market operation where the market operates as per the demand and supply that exhibits in the economy.  There is no governmental intervention and it supports capitalism. There is no risk of business nationalization and business persons are allowed to enjoy the return of their hard work. The democracy fosters freedom and assures free movement of factors of production whereas, in the context of the communist system, the factors of productions are controlled by the state, the risk of nationalization prevails.

The top ten countries globally favorable for doing business as ranked by the World Bank in 2018 are democratic. New Zealand holds the first position followed by Singapore, Denmark, South Korea, Hong Kong, and the US in the 6^th which is followed by the UK (World Bank, 2018). Further, China holds 78^th and Venezuela is 188^th, my country is 105^th.  In general, democratic countries have transparency, strong political base, are less corrupted and also public budget are well utilized fostering social infrastructures, a requirement for the success of the business. The sound economic condition creates social justice and social innovation.  The democracy builds up trust and assures sound legal and political environment which leads to sustainable economic progress.

Democracy certain promotes the growth through the inclusion of institutions, governance, rule of law and confidence to the investor.  But, often it has paralyzed the economy when the parties and people miss-utilized their power. Nepal was ruled by a monarch(king) for more than 100 years, we had multi-party democracy. Later on, after the people’s revolution, the monarch was dethroned and now its “Federal Democratic Republic of Nepal”.  Indeed, in the context of my country, democracy alone has not assured sustainable economic growth.  Rampant corruption, budget deficits, negative balance of payments, unstable government and negative net exports has reduced the confidence of domestic as well as international investors.  The pace of foreign direct investment(FDI) has been decreasing and economic stability is not maintained.

But when we see the countries like Sweden, Holland, Denmark, New Zealand, though are geographically small, their democratic policies along with rules and code on conduct base governance has maintained their economic domain.  As per the Transparency International, (2017), New Zealand in the least corrupt country of the globe followed by Denmark and Finland. Nepal ranks 122th and Venezuela is at 169^th.   

In contrast, communism which focuses on socialism is not a fault ideology at all, depending upon the circumstances and situation, socialism has also uplifted the social innovation and lead economic development.  China’s economic development is led by one-party nondemocracy (Acemoglu, 2014) which was led by a reasonably enlightened group of peoples but the ramification of the socialist dictator in Venezuela jeopardize the nation, eroding the life of citizens and reducing the business confidence.

So, as far I am concerned, definitely I incline with the democratic political system for sustainable economic growth rather than the totalitarianism. But equal importance should be given to the right conduct of political philosophies through politicians which should encapsulate good governance through strong legislation, execution, and independent judiciary.

Bibliography

Acemoglu, D. (2014, May 20). Does democracy boost economic growth? Retrieved from www.weforum.org: https://www.weforum.org/agenda/2014/05/democracy-boost-economic-growth/

World Bank. (2018). Doing Business 2018, Reforming to Create Jobs. World Bank.

"The study of international business is fine if you are going to work in a large multinational enterprise, but it has no relevance for individuals who are going to work in small firms.” Evaluate this statement.(International Business)

  This could have been a matter to be noted if we were in the closed economy where each firm (big or small) were self-sufficient, i.e. their home countries have enough factors of productions to maintain sufficiency in the demand and supply. But currently except some exceptions (like North Korea, Iran, Venezuela) almost most of the countries are into the global mainstream of international trading based on the doctrine of comparative advantage as postulated by Sir David Ricardo and SME’s (Small and Medium Enterprises) plays significantly important role in the global business. SME’s passivity could not be ignored rather each government has persuaded SME’s to come into the international trading stream. 

      The small business firms have become an integral component of the global business chain rather be it in the least developed(Nepal), emerging nations(India) or developed countries(USA), it has equal importance. Due to the low level of investment required for initiation, supportive government regulation and technological and internet boom small firms have ease to come into the mainstream of international trading either through providing the raw material to the big firms or by directing trading in the international market. 

          In the context of Nepal, WTO provides specialized preference to least developed countries and thorough multi-fiber trade agreement, Nepal was allowed to export the textile to the USA market. During 2001-2002, Nepal exported approximately US 9 million of readymade garments generating four hundred thousand jobs which were mostly in the small industries (Nepuane, 2016) which also high lights the immensity of the small business involvement in the international business. But for that, the involved business has to maintain the tight protocol of international trade mechanism, i.e. from the country of origin requirement, labor code, quality assurance, letter of credit (LC’s) et cetera. 

        My friend operated an industry back in my country Nepal which was into the manufacturing of the agriculture tools. The investment was huge and since the agriculture sector has a significant contribution to the GDP, the business seemed promising. But soon after its market penetration in the national level, it had to go through cut-throat competitions from Chinese and Indian products which it could not sustain. Sadly, the managements lack global business scenario jeopardize and bankrupt his company. Had he taken care of Nepal’s accession to WTO since 2004 which allows international companies to trade with Nepal, the management could have diversified the investment before it was too late. 

             The major portion of international trading, either be in the goods or in services industries are also backed by small businesses. There are constant flow and interaction of resources in the economy between small and big firms. As the per the statistics of the USA government in 2009, small business accounted for 96.4% of all manufacturing exports, which was 17.2 percent of the sectors $562 billion in exports. Similarly, SME’s accounted for 95% of firms and 60-70% of employment generation in the OECD economies (“Small and Medium-sized Enterprises”, 2012). 

         Further, an invent of liberalization, industrialization and disruptive tech innovations have made SME globally active. The SME’s contribute between 25-35% of world exports of manufacture (“Small and Medium-sized Enterprises”, 2012). Essa (2019) has voiced the importance of small firms in building the global ecosystem of international business and the learning of international business helps the small firms to co-evolve and innovate along with the global pace. 

       If it is the case of closed economy and self-sufficiency than international trade might not be a case for small and big firms and people working there but it would not be wrong to say that in the globalized economy the understanding of international trade is unequivocally important to the big as well as small economy in local, regional as well as national level. 

Bibliography 

Essa, T. S. (2019, January 08). SMEs are the most valuable partners. Here's why. Retrieved from www.weforum.org: https://www.weforum.org/agenda/2019/01/smes-make-the-most-valuable-partners-heres-why/ Nepuane, S. (2016, April 11). Seize the opportunity. Retrieved from thehimalayantimes.com: https://thehimalayantimes.com/opinion/seize-the-opportunity/ Small and Medium-sized Enterprises: Local Strength, G. R. (2012). Small and Medium-sized Enterprises: Local Strength, Global Reach. OECD.

Why the innovative projects fail to generate economic returns?(Management of Technological Innovations)

There are plethora of reasons for the economic demise of an innovative project. Some are systemic whereas some unsystematic. Some emerge from within the organization whereas some are generated from the outside of the organization. Some of the reason for the failure of the innovative projects are briefed below.

Death of the project in infancy

Some of the project though being captivating is not able to go a long way, they die in the introduction stage of its life cycle.  Due to incorrect timing and level of cut-throat competition in the market, it cannot sustain. Virgin Cola, the drink initiated by the Virgin group, though was liked by the customers could not sustain the pressure from the Coke Cola (Clifford, 2017) and has to give up.

The lengthy product development period

Some project trajectory is a real financial and regulatory cumbersome and before the product is commercially launched, it consumes lots of investments capping the project’s ability to generate revenues and return.  Elon Musk’s electric car Tesla and SpaceX has still not been able to generate return due to its which development cost.

Lack of dominant design

The projects start to gain the profit whenever it settles with its dominant design, the dominant design comes with positive learning and networking effect (Schilling, 2017), it comes with productivity, lower cost, and higher market acceptance.  But due to tough competition and rivalry often the company cannot settle with dominant design and has to frequently work on competing for the resources against the competitor leading to increasing the expenses.

Lack of project diffusion

The diffusion of the product into the markets infers the products are well accepted by the market.  The well-diffused product comes with dominant design and along with standardization and economies of scale. But sometimes due to the cut-throat competition, the project could not penetrate well or diffuse into the market and cannot generate enough revenues.  Nokia mobile was not able to diffuse itself to the market as it was not able to compete with iPhones and androids at that time.

Lack of synchronization between market requirement and organization offering.

It is not about offering the best product, it is about offering right products to the market at the right time, means the innovation has to be equally demand-pull as well as science-push, a product without the desire of the market could not sustain.  But due to the cognitive biases like “sunk-cost fallacy”, the company often goes on investing in the pessimistic project, thinking it will pay off but ultimately leads to cost overrun of the project.

            Except this the management often takes the wrong decision and crafts inappropriate strategies, have lack of market understanding and orientation which also leads to the economic demise of the projects (Hengsberger, 2018). So, there could be organizational structural fallacies or external environmental factors that may impact the project, hence it is of utmost importance to constantly revise and access the status of the project.

Bibliography

Clifford, C. (2017, February 7). What Richard Branson learned when Coke put Virgin Cola out of business. Retrieved from www.cnbc.com: https://www.cnbc.com/2017/02/07/what-richard-branson-learned-when-coke-put-virgin-cola-out-of-business.html

Hengsberger, A. (2018, October 4). 4 reasons why innovations fail. Retrieved from www.lead-innovation.com: https://www.lead-innovation.com/english-blog/why-innovations-fail

Schilling, M. A. (2017). Strategic Management of Technological Innovation, 5thed. New York: McGraw-Hill Education.

Advantages of technological innovation? Disadvantages?(Management of Technological Innovations)

Technological innovation for me is the way of bringing positive changes in the mode of consumption and production then it used to be before. So, what does it mean, let’s see, way back when I was at the immigration lobby of my country waiting for an hours-long line to get clearance from that almighty officer, I was often pissed off and irked, the opportunity cost was high as my prospective earnings from my meetings were enormous. Now its Eureka, we had a newly installed kiosk machine, where every data has been fed-in, as I reached there, I swapped my card and got clearance, indeed it was prompt and saved my time. You know, it was good for the immigration department also, their labor requirement should have gone done drastically.

These “C-Suits” terminologies like artificial intelligence, big data, block-chain and augmented reality are definitely bringing economic of scales but it is also risking the human current status. As per the World Economic Forum by 2022 due to the rise of technological innovation 75 million job will be outdated making people poorer (Cann, 2018), do you agree? But it will also add 133 million for new kind of jobs, but the question triggers who will invest in the transition of those 75 million losers into 133 million gainer club.

No doubt, tech innovation brings security, a peace in my mind, when I sleep, switching on by ADT laden CCTV camera, but it bothers me when it constantly gazes and stares at me. My Fitbit wrist watch gifted by my sister is a state of art, making me classy but I really feel bad when I read research published by Fitbit about the sleeping habit of its watch users, definitely, they might have pulled my data. You see, I didn’t know that, where is my privacy?

China is leading its way on AI, it has installed 20 million cameras (Lo, 2017), reading your each and every geometry and facial identification, it has a new system of “social credit” and I swear do not dare to bite against the government, your negative social credit will not let you even have good commutes. But the beauty is in the eye of the beholder, you are cutting trees, but the drone technology is replacing the human afforestation process in Pakistan, the camera attached with the drone first captures the project landscape the disperse seeds and can plant up to 100000 trees a day (Hutt, 2018), innovation to combat GHG.

But sadly, these innovations are also bringing a kind of social fraction whose ramification could be detrimental.  We are into the “review economy”, you review your uber driver, the hotel where you nested and the multiplex where you watched movie, and I am afraid a day, a general person like me, who always maintains the neutrality will be score on the basis of which I would get job, allowed to ride or even marry. Is not this more structured? I think the constant monitoring makes us artificial.

And often, the innovation is seen more polarized to developed countries, which are pulling all the resources back to them. The lag period of the innovation to travel from the innovator to markets far from the innovating country is huge, though those countries could be their market (I mean from rich innovating countries to 3^rd world) is huge. I feel the divergence and delegation of innovation are not homogenous which should have been.

Lastly, as Moore's Law has stated, the cost of technological innovation half’s every 18 months and speeds its performance increases by doubles the same time, and the controlling mechanism often lags behind these innovations. Have you thought or were there any stern data protecting act before the data mining scandal from Facebook? 

Yes, no doubt, technology has changed how we used to consume, how we use to commute and how I used to converse but it certainly has a paradox, often I am traded in-between the market without my knowledge, I feel a new kind of capitalism has been brought by the tech-innovation, Google earns on what the user feed, its capital is not, what it manufactures but it is what ordinary users like us feed. So, is Google playing a fair game by making my Gmail account free for me? Perhaps the quest to this statement shall always remain unanswered as all innovation shall always be driven by profit and there will always be pro and cons, and the innovator is good until they are egalitarian and utilitarian. 

Bibliography

Cann, O. (2018, September 17). Machines Will Do More Tasks Than Humans by 2025 but Robot Revolution Will Still Create 58 Million Net New Jobs in Next Five Years. Retrieved from www.weforum.org: https://www.weforum.org/press/2018/09/machines-will-do-more-tasks-than-humans-by-2025-but-robot-revolution-will-still-create-58-million-net-new-jobs-in-next-five-years/

Hutt, R. (2018, July 02). Pakistan has planted over a billion trees. Retrieved from www.weforum.org: https://www.weforum.org/agenda/2018/07/pakistan-s-billion-tree-tsunami-is-astonishing/

Lo, T. (2017, September 25). Big brother is watching you! China installs 'the world's most advanced video surveillance system' with over 20 million AI-equipped street cameras. Retrieved from www.dailymail.co.uk: https://www.dailymail.co.uk/news/article-4918342/China-installs-20-million-AI-equipped-street-cameras.html

To what degree would you characterize Given's development of the camera pill as "science-push” versus "demand-pull”?(Management of Technological Innovations)

The science-push” innovation is fundamentally based on the scientific discoveries backed by research and development whereas the “demand-pull” is the innovation made on the basis of the market demand (Schilling, 2017). The development of the camera pill for me is the combination of the demand-pull and science-push. The desire to innovate a camera guide missile was the demand-push which latter inclined Iddan to focus on camera pill for endoscopy and the cross-industry scientific discoveries like charge-coupled device (CCD’s) and complementary metal oxide semiconductors (CMOS) was science push. And these two complemented each other in the discovery of camera pill.

Hoppmann (2014) concluded the balance between the demand-pull and technology-push has shifted to the demand-pull, the same could be reconciled with the case as demand for the missile ignited the development of camera pill. Peters, Schneider, Griesshaber, & Hoffmann (2012) added the demand-pull also facilitates going abroad as the demand from those collaborates innovation process, the independent team working in the United Kingdom came up with the expertise in their field of wireless endoscopy, indeed the innovation has been through the collaboration within the networks who shared the common objective or has possessed the tactics or knowledge to perform such (Schilling, 2017).

Indeed, these two innovative methodologies often support each other, any innovation of product and service is not deemed necessary unless there is a demand and collaboration often supports assimilation and improvisation to innovate the products and services.

References

Hoppmann, J. (2014). The Role of Deployment Policies in Fostering Innovation for Clean Energy Technologies: Insights From the Solar Photovoltaic Industry. Sage Journals, 54(4), 540-558. https://doi.org/10.1177/0007650314558042.

Hoppmann, J., Peters, M., Schneider, M., & Hoffmann, V. H. (2013). The two faces of market support—How deployment policies affect technological exploration and exploitation in the solar photovoltaic industry. Research Policy, 42(4), 989-1003. https://doi.org/10.1016/j.respol.2013.01.002. Retrieved from www.sciencedirect.com: https://www.sciencedirect.com/science/article/abs/pii/S0048733313000073

Schilling, M. A. (2017). Strategic Management of Technological Innovation, 5thed. New York: McGraw-Hill Education.