International Business Environment: Strategies and Capabilities

Business International
Environment

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
International strategy: From local to global and beyond........................................................1
Summary and discussion on International strategy diversification and speed.......................1
Summary and discussion on Cultural and formal institutional environment.........................3
Summary and discussion on Exploiting and exploring critical capabilities...........................4
Future research avenues.........................................................................................................6
CONCLUSION................................................................................................................................7
REFRENCES...................................................................................................................................9

INTRODUCTION
Business Environment comprises of various dimensions such as economic, tax
regulations, social environment, political, technological as well as legal environment that affect
the operations of international business.
In simple words international business environment basically emphasize on transferring
necessary goods and services across the national boundaries (Zolin & Schlosser, 2013). Thus, it
includes trading or export and import activities which require the need for licence or franchising.
This report carries the discussion about various sections such as establishing international
strategy to diversify its business as well as speed and timings of enter into international market.
Moreover, it emphasize on cultural, formal as well as informal institution based on international
strategies. Finally, discussion is made on exploiting and exploring critical capabilities (Dunning,
2014).
MAIN BODY
International strategy: From local to global and beyond
Here we need to analyse that internationalisation has led to the development of MNEs by
expanding its operations in various national, local as well as international market. The role of
building international strategy has growth over the last decades. Thus, to conduct operations in
local as well as global market business largely depend upon huge funds to conduct its social
performance. Earlier several economies were closed economy but emergence of
internationalisation has lead to enhancement of communication as well as technology facility as
compare to the past. Further, it has development of overall economy with the rise in competition.
From the above analyses I have analysed that internationalisation helps in growth of
development of country by increasing the employment opportunity for the local community.
Therefore, local communities must promote such practices. On contrary, my negative opinion is
that it will be tough for the organisation to adopt according to the culture of other market because
it is not necessary that the culture of foreign market is same as local market.
Summary and discussion on International strategy diversification and speed
The discussion will be about International strategy leaves a significant impact on the
growth as well as development of overall economy and diversification of multinational business.
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This has helped the overall organisation to increase the connectivity than helps in global
expansion of business.
Advancement due to international diversification
Diversify the business operations internationally is a kind of portfolio investment done by
company with the motive to generate huge revenue, expand the business overseas and also to
diversify or set off the chances of risk (Sasaki & Yoshikawa, 2014). Additionally, if the
investment is diversified in various markets then it leaves less burden of loss as the chances of
risk gets diversified in various markets. This help the international business to formulate flexible
strategies and strengthen its value chain activities. Along with that most of the multinational
companies identify the opportunity of expansion after properly analysing the external
environment and accordingly they take the initiative to move across overseas. Further, most of
the researchers on the basis of their findings seeks that there is a affirmative relationship between
diversification of business in international market and speed up the performance of enterprise to
diversify in order to flourish its business. For instance, product diversification strengthen the
relationship between diversification and business performance whereas unrelated diversification
weaken their relationship. Thus, there is a U shaped relationship among them which helps in
innovation, diversification of advanced technology, enhances the performance of people by
making them skilled, diversification of capital, taking patent rights over innovation and so on.
On the basis of survey most of the firms that consist of family members gets benefited by the
international diversification of business rather than non family businesses (Beugelsdijk &
Mudambi, 2013).
Focusing on timing and speed to enter in foreign market
Entry mode is a time when business takes decision of diversifying its operations in
international market (Wang, C., et.al., 2012). This time when business just start to cater
international market then the timing as well as speed of business is different from that duration
when business becomes comfortable in international market. The factor such as speed and time
differ because when the business starts its operations it get affected by various factors that act as
a learning which formulated the behaviours as well as its experience. In short run it act as a
learning where business can accelerate its speed on contrary in long term international business
various constraint are imposed in rapid expansion of business. Thus, the timing or speed to
conduct international business as well as merger or acquisition gets encouraged by large size of
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