Global Business: Challenges and Strategies for MNCs

Global Business
Table of Contents

EEC (European Economic Community)............................................................................................4
Discuss why MNC’s internationalise & typical challenges they encounter.......................................4
1. INTRODUCTION.............................................................................................................................6
2. Analysis of domestic market..........................................................................................................6
3. Strategy to internationalise............................................................................................................7
4. Selected country environmental analysis.......................................................................................7
5. Modes of entry, challenges it may find in the country & possible solutions..................................9
6. Leadership qualities that supports the market entry.....................................................................11
7. CONCLUSION...............................................................................................................................12
REFERENCES....................................................................................................................................13
Books & Journal:.............................................................................................................................13

EEC (European Economic Community)
The EEC was established and design with motive of creating a common market
amongst its members through the elimination of trade barriers and developing a common
external trade policy. This community was formed in 1957 to work with mutual cooperation
in the market without facing any problem or issues. The European community includes three
associations which were European Economic Community European coal and steel
community and European atomic energy community. In 1993, when Maastricht Treaty went
into effect European community was rolled out into the European Union. With the
establishment of this community business sector was becoming more expandable within the
market. It was founded by Jean Monnet and it is a part of an economic Union. This
community formulated external trade policies were also implemented with new policy and
procedures with the agriculture policy to protect the farmers from agricultural imports
(Brenkert, 2019).
EEC was founded by the six states and other two communities which were also
known as inner six are the outer 7 who form the European free trade association. The main
purpose of EEC has been given below-
 Development of custom Union with the common external tariff
 Common policies for transport trade and agriculture
 Enlargement of the EEC the rest of Europe
For the custom Union the treaty provided 10% reduction in custom duties and up to 20%
of global import quotas. This has led to ease of running the market and other activities in a
smooth manner. With Establishment of this community, balance for economic growth and
development able to achieve with proper considerations. )(Kasemsap, 2020).
Moreover, they also regulate and implement the new strategy and tactics in relation with
the tariff and taxes so that market is able to run the business properly. In relation with the
McDonald, this help them to important export their raw materials for the food and beverages
around the world in in effective way stop this increases the coordination as a less mutual
cooperation among the business sectors and other countries. Furthermore, this gives a new
hope to the business and industries tour and their activities functions and operations in well
organised manner.
Pros-
 It gives leverages to the business sectors and other communities
 It also provides assist to many businesses to run their activities smoothly.

Cons-
 Due to difference in ideas problems occur in the communities
 Some policies and decisions are not acceptable by organisations
Discuss why MNC’s internationalise & typical challenges they encounter
MNCs adopts the internationalise procedure within business sector because they wish
to expand their business and run the activities as well as operations all over the countries to
gain more profit and market share growth. Many MNCs use different tools and techniques as
well as methods to access the international market within a period of time. It is not easy to
international business because it requires connection, strong communication and deep market
research. Another reason for making the business internationalise is that MNC’s are able to
acquire the reliable resources as well as manpower for their function and operations around
the region and countries.
It also allows them to understand the market trends and explore new opportunities
through the internationalisation. It is a longer and time consuming process but is effectively
used by many enterprises to gain the competitive advantage. In relevance with selected
enterprise, they also use the internationalisation process with proper market is and
consideration which help them to analyse the negative and positive impact on their business.
There are many challenges faced by them when going for the internationalisation and
discussed below-
 Internationalisation process- One of the main challenges faced by the MNC is
internationalisation process in which planning and organising li activities such as
finance human resource and other are being undertaken and considered which is a
difficult process and focus as well as knowledge. To be able to carry out the process
the company needs a deep analysis of market and situations as well as capability to
enter or not. )(Johnston, 2019).
 Selection of target customer and market- Another challenge MNCs encounter is
that it is difficult for them to identify and examine the target customer as well as
market for their product in business. This is because market is new; customers taste
and changing demands is unknown which is a problematic situation for the business
to access the potential market. Making analysis not easier as if you care knowledge of
local market and people show the distance regarding the introducing product and
services are being done in proper way (Rummel, 2019).
 Government rules and regulations- When going for the internationalisation it is also
difficult for the MNCs to run their business as in different countries different rules
and regulations are being regulated and considered which have to be accepted by the
companies who are operating their business. Many MNCs need to be pre- prepared