International Business Challenges and Strategies

The provided report delves into the complexities of international business operations, highlighting the challenges that organizations face when conducting business in other countries. These challenges include financial, social, political, and environmental issues that can reduce business profit and increase loss situations. To mitigate these factors, businesses must make strategic plans at an international level, adhering to host country policies and respecting their social culture and environment.

International Business

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
2) Impacts of challenges on international company....................................................................3
3) Company Address challenges-................................................................................................6
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................8

INTRODUCTION
International business is the internationalization process of multinational organizations. A
multinational organization is a company that has operated worldwide. It manufacture and
operations in large number of countries. Etisalat is an international telecommunication of United
Arab Emirate (Buckley, 2017). It has many other branches in several countries. It provides
services at low cost. Report will be discuss about international business challenges like financial
and economic issues. After this report will explain impact of challenges and their results. And in
the last report describe addressing methods of these issues. Report give information about
different challenges for Etisalat to operate its business at global level. Telecommunication in the
UAE is under control of Telecommunication Regulatory Authority which was established in
2003. Emirates Telecommunication Corporation was the single telecommunication provider in
UAE. This monopoly became duopoly when a new telecom and internet service provider Du was
established in 2006. DU provided triple play services to free zone areas.
MAIN BODY
International business has to face many risks and challenges at many stages. Etisalat ia
multinational Emirate based telecommunication organization. It recently operating in 16
countries across Asia and Africa. It is the 14th largest telecom network in the world. It was named
the most strongest company in the United Arab Emirates by Forbes. It is one of the internet hubs
and largest carrier of international voice traffic in Africa. This international Etisalat has their
own challenges some are similar to local business and some are different. It will be clearer with
an example that domestic and international; both the businesses face financial challenges but
international business faces global financial issues (Asante, 2017). Some challenges of
international issues are discussed as below:

Sources: EtisalatUAE profitup 5% to Dh8.2 billion, 2017
Illustration 1: TOP 3 MIDDLE EAST BRANDS BY VALUE

International planning and strategy
The first challenge for international business is to frame global level strategy planning
and implement it in company. The manager finds difficulty in their thought process and decision
making is not easy for them and this useable for running business smoothly. In the international
business empire there are many international organizations those adopt global strategy planning.
Etisalat is an international business organization which has many branches in other countries
across the world. It is not easy for that it can run business at global level. Make business
planning and strategy according to country and implementation is quite difficult.
According to Buckley, (2017) International business requires extra ordinary skilled and
talented management, leaders and employees. Before planning the international policies,
organization is familiar with host country’s political environment. Strategy according to country
environment reduce international business challenges and make business familiar with host
country environment (Buckley, 2017). Etisalat firstly studies the host country’s market and
makes planning and strategy which is more beneficial and easily adoptable for organization or
local crowd. Planning business strategy according to other country’s business environment is not
easy, it requires time and talent.
Financial and economic challenges
Before starting an international business, arranging funds is another challenge for
organization. Financial challenges include fluctuation in exchange rate, global economic crisis,
economic condition of host countries, high crude oil prices for transport departments. Etisalat
may face financial and economic issues in the host countries. Income level of local crowd, low
GDP and productivity of country, tariff issues, inflation at global level, etc. increase the financial
challenges (The Problems Of Etisalat Spells Danger For Nigeria’s Economy, 2018). High
investment and low return impact organization’s economic status and this status depends on the
domestic people’s earnings. Foreign risk exchange relates to currency fluctuations. International
business with domestic employees increases company’s investment.
According to view of Rees and Smith, (2017) Business has to spend money for conducting
grooming program and providing development training which helps them to become
extraordinary (Rees and Smith, 2017). In the crisis period, currency is worthless for business, if
customers are paying worthless currency for product and services, is not profitable. International

business has to increase their financial level, they have amounted to cover losses Low GDP of
country is the sign of low financial profit. It is quite difficult for entrepreneur to make profit and
run their business in an easy going way. Business has to take risk and expand their business. If
Etisalat wants to expand their business, it has to be ready for risk and spread business with
financial issues. The quality of economic growth not quantity require measure. Nigeria's
economy is crawling out of recession. It is turning the face from difficult time. On account of the
foreign exchange crisis, result of free float of the country. Telecommunication sector has a large
contributor to GDP.
International politics
Country's government's policies are essential for everybody but it becomes more
important when an international business is operating in another country. Some government
policies are good for international business while others are quite difficult to adopt. Leipziger,
(2017) said that Government of host country frame few difficult policies for international
business to increase their GDP and living level of citizens. Etisalat faces some issues for
operating its business in other country. Government applies high tax rate on host organizations,
oil prices for transport, import-export rate etc. (Leipziger, 2017). All are the government policies
to earn more profit from international business. Nigeria's political factors is the biggest
challenges for business.
Government makes some easy policies for businesses like providing landscape easily,
giving specific facilities and building a strong international trade relationship, providing labour
at cheap cost, etc. Political system is a complete bundle of rules and regulations and institutions.
Political system's impacts the policies of government and business environment. International
business needs to follow country's religious law, and country culture to run their business. For
example: Etisalat has to follow a country's religious laws and provide their services according to
it. According to view of Leamer and Stern, (2017) Government makes a deal with business
owner and take a promise that business will never provide such kind of services which are
harmful for country ethics. Country's security is another political factor for business.
Government will never permit any business which can destroy country's peaceful environment
and during export-import trading system, this policy deal is more important.

2) Impacts of challenges on international company
When a business body wants to operate at international level, they face many challenges.
Operating a business empire at international level is a difficult task. Business faces some
challenges like international planning and strategy, financial and economic issues, international
politics etc. These challenges make an impact on business and effect its growth and profit.
Impacts of challenges on international business body are-
Impact of international strategy
Implementation of international strategy influences a business. Business has to form its
planning according to host country's market condition. Make such business plan and strategies
which are more beneficial for business, and expand it in different countries. According to Kolk
and Rivera-Santos, (2018) Recognizing consumer's taste and what they prefer to have is not easy.
Business has to spend money in market research and produce those products and services which
are mostly liked and used by domestic customers. They require local employees to become
familiar with country’s traditions (Kolk and Rivera-Santos, 2018). These local employees may or
may not be skilled and talented. Organized a training and development work-shop for employees
skills improvement. It is not a part of their business plan but they have to take some actions to
imply it. International business challenges put their impact on Etisalat’s planning and strategies.
Telecommunication firstly has to understand country's culture or traditions and frame
strategy to satisfy customers. International planning increases business investment and it is not
sure whether this planning will be useful or not. Returnable Business should be flexible to
accept these losses and do not take these losses in negative way. Without any planning, business
cannot run to make effective planning and strategies at international level organization take help
of expert and qualified, But hiring of skilled people also an investment of company. In short,
international business planning and strategies is initial investment for company which covers
organization body, strategy, manpower and management.
Impact of financial and economic challenges
Financial or economic status of any country influences the business. International businesses
faces crisis, high fluctuation rate, prices of crude oil, GDP of government, etc. challenges.
Economic conditions of host country give an idea to business and invest their money according
to it. High fluctuation is the sign of business loss and this rate is globally affected ( Leamer and
Stern, 2017.). Crisis show country's economic condition and over coming this unexpected market

situations not easy to establish an international business entity (The Problems Of Etisalat Spells
Danger For Nigeria’s Economy, 2018). Crisis or high rate fluctuations impact organization's
economic value and a sick financial condition is a loss for organization. Etisalat faced financial
and economic crisis and established business in this environment is tough for it. Healthy
financial condition supports a business to become a strong entity, but when high fluctuation rate
or crisis arises in global market, organization economic status will impact. Opportunities and
benefits of growth are distributed at different areas and social groups. Productivity, income,
benefits all are influenced by economic issues. Nigeria has huge number of subscribers of the
population. Etisalat to ensure that is small disruption to the economy, especially when where
economy is still fighting with the crisis. Etisalat subscribers and signals may send potential
investors in the telecommunication industry, if unfair situations over the industry.
International politics- Organization has to follow government policies before operate business
outside the country. It is compulsory for business entity that they make business plans which
beneficial for country and company. Firstly organization understand government rules and
produce product and services. High tax rate, market fluctuation, crisis etc. make an negative
impact on business organization. A company expand their business to earn maximum profit and
capture the more market share. Host country policies is not necessary that suitable for every
international organization (Moore and Jennings, 2017). Etisalat is an international business
organization, who has many branches in several countries. It is not easy to follow policies of
every host country. Political issues have the power to change results. Companies should be
prepare to deal with the local and worldwide outcomes of policies. The international political
condition of host country influenced company economic setting. The influences issue like taxes,
which affect the economy results. Government regulations also affect the business. It relates to
social environment, and this urged a change to make organizations more liable. Etisalat has
international operations use insurance to reduce risk. Government looks at business as a critical
vehicle for society. Host country government policies are liable for protecting citizens interest.
Government actions influence the organization economic environment. Policies major consumer
of products and services, and if they found any wrong thing in production, government can stop
production. For international business legislation pass by government, which impact many
relations like customers, companies and suppliers. Policies are created to save country social

environment and business has to maintain their culture. Some political factors which affect
business-
 Tariffs
 Trade control
 Employment law
 Environment law
 Tax policy.
Etisalat has to follow all these factors to make more profit.
3) Company Address challenges-
To earn profit and spread the business at international level Etisalat has faced many challenges. It
has to make some plans to reduce all those risk. The biggest issues for Etisalat are international
strategy, financial and economic challenges, political issues etc.
International strategy- According to Rugman and Verbeke, (2017) a solid and trustable
relationship between organization and country that facilities business exchange is worthless
(Rugman and Verbeke, 2017). Take the time to make strategy for internation business to
established healthy relationship with country and customers. Etisalat has to frame such a strategy
which build a good relation between host country and them. This friendly strategy clear its path
to run business smoothly. With the help of plan they can easily understand what kind of strategy
government has and how they can deal with them. A good offer from Etisalat to other
government helpful to win their trust. International business strategy as a distinctive plan that
require its tools and work structure to understand and analysed.
Financial and economic challenges- Etisalat main challenge is financial and economic status of
host country. If the economic condition of host country is not good then Etisalat cannot run
business and fail to make profit (McGovern, 2018). Before the investment telecommunication
has to research on some factors. Firstly telecommunication has need to know its customer needs,
In this rapidly changing world customers’ requirements has been change frequently. According
to Sullivan customers are savvier and aware about their financial condition. The economic crisis
is the biggest challenging factor for international business. Etisalat avoid established its business
in this situation, It is not a good economic sign. Crisis is very fresh in consumers mind and they
do not want to invest their money in new business firm. According to McGovern, (2018) to
overcome with economic issues organizations have to idea country market and people income

level. Large investment in low GDP country decrease the company financial and economic
status. So before established business in other country, its market study and economic level
research is necessary.
International politics- Government policies at international level impact the business. Etisalat's
business effect by international policies. Government rules and regulations for other country
business is not easy like local organization entity. Tax policy, tariff, employment law etc. The
trade agreements with other country, is quite difficult for business. Government wants to earn
more profit sharing and try to increase GDP (Omeje, 2017). Etisalat to reduce political factors
impacts make an agreement with government that they provide certain percentage employment
to local people which help them increase GDP. Follow policies and try to maintain their culture.
It does not produce such services and goods those are banned in host country. According to
Omeje, (2017) socialist economy where individuals own most of property of the business. To
reduce the politics factors impacts on business Etisalat follow country trade policy, tax, social
environment etc.
Business risk in Nigeria-
A high-risk political and culture condition create a difficult business environment.
Organization environment is very competitive (Asante, 2017). Corporate financial information is
not easily available. The legal system of country make business culture difficult. They cannot
operate their business in this critical situation and it is quite difficult to manage in the high risk
culture (Nigeria: Risk Assessment, 2018). High critical situation affect the Nigeria market, tax
rate, oil revenues, distribution and production strategy, ethnic and religious tensions increase the
business risk. Insecure and corruption market is not beneficial for operate business. Financial
and economic issues increase the business risk in Nigeria. These factors are barriers for an
organization. It is quite difficult to run a risk less company where this challenge is available. For
a new business entity it is a big risk point and reduce it is not a easy task.
Country problem- Nigeria contentiously facing legal issues and political affairs. Law system
affect the country business environment. It has to follow difficult country law which are not
beneficial for business purpose (Leamer and Stern, 2017). Second is political affairs make
impact on business culture. High tariff policies, tax rate, oil prices etc. influenced the business
and these are the main problem of country.

To reduce this problems, company have to produce those kind of products which are not
much expensive and easily available to every customers. This step decease the oil price impact
and high tax and trade rate.
CONCLUSION
Above report explained the international challenges for organization entity when it going
to operate business in other country. It is not easy to run business in several places. Worldwide
trade operations have to face many issues like financial, social, political etc. This factors reduce
business profit and increase loss situations. To reduce these factors negative impact business has
to make some plans at international level which follow host country policies and maintain their
social culture and environment.

REFERENCES
Books and journals
Asante, S.K., 2017. The concept of the good corporate citizen in international business.
In Globalization and International Investment (pp. 139-176). Routledge.
Buckley, P., 2017. International business. Routledge.
Haigh, R., 2018. Legal English. Routledge.
Hartmann, M., 2017. The international business elite: fact or fiction?. In New Directions in Elite
Studies (pp. 39-53). Routledge.
Kolk, A. and Rivera-Santos, M., 2018. The state of research on Africa in business and
management: Insights from a systematic review of key international journals. Business &
Society, 57(3), pp.415-436.
Leamer, E.E. and Stern, R.M., 2017. Quantitative international economics. Routledge.
Leipziger, D., 2017. The corporate responsibility code book. Routledge.
McGovern, E., 2018. International trade regulation (Vol. 2). Globefield Press.
Moore, L.F. and Jennings, P.D. eds., 2017. Human resource management on the Pacific Rim:
Institutions, practices, and attitudes (Vol. 60). Walter de Gruyter GmbH & Co KG.
Omeje, K., 2017. High stakes and stakeholders: Oil conflict and security in Nigeria. Routledge.
Rees, G. and Smith, P. eds., 2017. Strategic human resource management: An international
perspective. Sage.
Rugman, A. and Verbeke, A., 2017. Global corporate strategy and trade policy. Routledge.
Tjosvold, D., 2017. Cross-cultural management: foundations and future. Routledge.
Online:
The Problems Of Etisalat Spells Danger For Nigeria’s Economy. 2018. [Online]. Assessed
through: <https://independent.ng/problems-etisalat-spells-danger-for-nigerias-economy/>.
Nigeria: Risk Assessment. 2018. [Online]. Assessed
through:<https://globaledge.msu.edu/countries/nigeria/risk>
Etisalat UAE profit up 5% to Dh8.2billion .2017. [Online]. Assessed through:
<https://www.khaleejtimes.com/etisalat-uae-profit-up-5-to-dh82billion>.