With this lesson, we begin the portion of the course more closely related to strategies and operations of multinational enterprises and to managers of firms engaged in international business. Up to this point, we have examined the political, economic, and cultural environments in which international businesses operate, as well as governmental influences and interaction which affect international business. For the remainder of the course, you will draw upon these basics and apply them to the practical matters of doing international business. Please do not feel that because you have completed your examination you can forget what you have learned. We will assume that you have mastered and retained the earlier information as we proceed.
Business operations are most successful when managers plan and take a strategic approach.
By this we mean that managers evaluate the environment in which they operate and the strengths and weaknesses of their own companies. As a result of this evaluation, they set goals and objectives, and plan activities for the accomplishment of these goals and objectives. With the emergence of a global economy, more and more options are available to firms as they assess opportunities for becoming competitive. The concept of a firm as a value chain, developed by Michael Porter, whose work we met when we discussed trade theories, is a convenient way of thinking of the complex of activities a firm performs. Each of the components of the value chain offers opportunities for firms to enhance their competitiveness.