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Running head: STRATEGIC INTERNATIONAL BUSINESS MANAGEMENT
STRATEGIC INTERNATIONAL BUSINESS MANAGEMENT
Name of the student
Name of the university
Author note

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1STRATEGIC INTERNATIONAL BUSINESS MANAGEMENT
Table of Contents
Background of the organization.......................................................................................................2
Rationale for choosing the target market.........................................................................................2
Competitive intensity of the market................................................................................................4
Internal environment of the organization......................................................................................10
VRIO analysis............................................................................................................................10
Market entry mode.........................................................................................................................13
Conclusion.....................................................................................................................................18
References......................................................................................................................................19
Appendices....................................................................................................................................23
Appendix 1: PESTLE analysis of the two countries- Norway and Mexico(1250 words).........23
Appendix 2- Economic state of Norway...................................................................................37
Appendix 3- Economic state of Mexico....................................................................................38
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2STRATEGIC INTERNATIONAL BUSINESS MANAGEMENT
Background of the organization
Lidl Stiftung & Co. KG is a German based global discount supermarket which was
established in the year 1930 (Lidl.com 2020). The organization is based in
Neckarsulm, Germany and operates through over 10,800 stores across Europe and the United
States (Lidl.com 2020). The concerned organization took the initiative of improving the
propositions in accordance with the needs of the customers. In this context, the report will
delineate the competition that might be faced by the organization while making an expansion in
the chosen target market and the market entry strategy that might be selected by the same for
increasing the scope of market expansion.
Rationale for choosing the target market
The chosen target market for the concerned organization is Norway, which is a politically
stable nation. The lower rate of government intervention in the different business operations
would allow the concerned organization in improving the scope of expansion of the business in
the different regions of the economy. The nation also facilitates an improved scope of FDIs
through increased partnership between the private and public enterprises (Svalund et al. 2018).
Moreover, the growth of GDP of the Norwegian economy after the downturn in 2019 and the
minimization of corporate taxation in the economy would empower the growth of the business in
the markets (Shaikh, Karjaluoto and Häkkinen 2018). It has been observed that the nation held
9th position in terms of financial markets in the year 2014 with increased market innovativeness
as per the reports of the World Economic Forum (Weforum.org 2014).
The GDP growth and increased employment rates would allow the organization in
attracting the attention of huge number of prospective customers. However, it has been noted that
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3STRATEGIC INTERNATIONAL BUSINESS MANAGEMENT
the Norwegian markets are saturated with the existence of a range of retail organizations like
Kiwi, Meny, Jacob's, Spar and Eurospar, which might reduce the scope of the concerned
business’ growth (Schmid et al. 2018). On the other hand, it has been noted that the free trading
policies and legislations that are being imposed by the government would encourage the growth
of the organization while operating in the different regions in the Norwegian markets. It has been
observed that the increased employability of the Norwegian communities has influenced the
growth of the disposable income among the same.
Bladowski and McCowan (2017) stated that the improved employability of the people in
a nation influences the growth of the disposable income while improving the scope of growth
and sustenance of a business in the markets. The factor that might influence the growth of the
organization in the Norwegian markets are reliant on the availability of natural resources and the
improved infrastructural designs. It has been observed that the work culture in the nation
portrays egalitarian values along with improved educational rates among the people. Therefore,
the nation provides a scope for the businesses through the improvement of skilled labor supplies
increasing the scope of uninterrupted functioning of the venture. Egalitarian values and educated
workforce would allow the organization in improving the overall operational performance in the
markets. It has been observed that the improved technological innovations and maximized
penetration of the broadband services in the different regions of the Norwegian markets would
allow the concerned organization in influencing the expansion of the business.
Moreover, the increased affordability of the Norwegian customers have significantly
reduced the rate of price sensitive customers. It has been observed that the people in Norway
expects quality propositions disregarding the price of the propositions. The reduction in the rate
of unemployment from reduced rate of unemployment in the nation from 4.2% in 2017 to 3.6%

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in 2019 has improved the buying power of the consumers in Norway (Huang et al. 2019).
However, the fact that the market situation Norway is saturated with the existing players might
increase the market competition. The infrastructural developments are the key factors that would
influence the growth of the organization in the markets. Moreover, the increased innovativeness
in the nation and different improvements in networking facilities through ICT would support he
organization in increasing the sustenance of the same in the markets.
The ICT would assess the organization in improving the rate of operation of the venture
through enhanced interconnectedness and networking. Appleton (2019) stated that the improved
interconnectedness in the different departments of an organization enables the same in increasing
the efficiency of the operations while meeting the common goals of the venture. Moreover, it has
been observed that the growth of the service sectors in the Norwegian economy would allow the
organization in increasing the rate of operations of the venture while operating in the different
markets. The growth of the service and the support sectors in the economy would allow the
organization in increasing the effectiveness of the business operations in accordance with the
needs of the venture.
The legislative and regulatory impositions that are made by the Norwegian government
and clarity of communication along with integrity would empower the growth of the
organization in the markets. Therefore, the clarity of communication on the legislations and the
minimized rate of corruption and bribery practices in the governmental and non- governmental
agencies in the economy would boost the growth of the concerned organization in the Norwegian
markets.
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5STRATEGIC INTERNATIONAL BUSINESS MANAGEMENT
Competitive intensity of the market
Competitive rivalry
(strong force)
A large number of retail chains
operates in the Norwegian markets
including companies like Kiwi, Meny,
Jacob's, Spar, Eurospar and the like.
The different changes in the
organizational operation are based on
the efficient functioning of the
different systems in accordance with
the needs of the venture. However, it
has been noted that very few market
players holds a larger portion of the
market share in the economy which
might be an advantage for growth of
the organization.
The technological developments that
are being made by the competitors
might affect the capability of the
organization in gaining a competitive
edge while operating in the Norwegian
markets (Xie and Li 2017).
The higher rate of differentiation of
the propositions that are made by the
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6STRATEGIC INTERNATIONAL BUSINESS MANAGEMENT
concerned organization in the industry
would support the same in gaining a
greater share of the market through
competitive edge over the propositions
that are made by the existing players.
Bargaining power of the suppliers
(weak force)
The Norwegian markets holds a large
number of suppliers for ensuring
uninterrupted functioning of the
business units as per the needs of the
venture. The availability of large
number of suppliers in the Norwegian
markets has minimized the bargaining
power of the same while operating in
the different markets.
Moreover, the propositions that are
made by the suppliers are fairly
standardized and have lower switching
costs. Again, the propositions are less
differentiated. The factors would
allow the organization in switching
between the suppliers in accordance
with the different needs of the
ventures. The lower switching cost

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7STRATEGIC INTERNATIONAL BUSINESS MANAGEMENT
between the suppliers minimized he
bargaining power of the suppliers in
the given economy (Ahi et al. 2017).
The wider availability of propositions
from the different suppliers would
allow the organization in promoting
the uninterrupted flow of operations in
accordance with the needs of meeting
the common organizational objectives.
Bargaining power of the buyers
(strong force)
The existence of huge number of
competitors in the industry might
affect the capability of the venture in
dominating over the bargaining power
of the buyers. The increased
bargaining of the buyers might be
attributed to the factor relating to the
existence of large number of retail
supermarket chains in Norway. Again,
the lower switching costs from one
organization to another has influence
the growth in the bargaining power of
the Norwegian customers
The price and quality of the
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propositions are the major
considerations that are made by the
buyers while choosing between the
propositions that are made by the
concerned organization with the other
market players (Tulung 2017).
Therefore, the marketing activities of
the organizations in the retail sector
and the influence that is created by the
same among the minds of the users
has backed the bargaining power of
the same
Threat of new entrants
(weak force)
The capital requirements in the retail
industry are high which incapacitates
the scope of the new entrants to
influence the market conditions. It has
been observed that high rate of initial
investments might be made by the
new entrants with the purpose of
improving the effectiveness of the
business operations in accordance
with the need of the market demand.
The government policies within the
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9STRATEGIC INTERNATIONAL BUSINESS MANAGEMENT
industry require strict licensing
activities which might again restrict
the scope for the new entrants in
entering the Norwegian markets.
Therefore, the new entrants creates a
weaker force of threat in the
Norwegian markets for the growth of
the concerned organization
The economies of scale is difficult to
achieve in the industry which
restricted the capability of the new
entrants in improving the prospects of
growth and development. Therefore, it
weakened the force of the new
entrants while operating in the
different markets.
Threat of substitute propositions
(weak force)
The substitute propositions are costly
to manufacture which increases the
price. It has been observed that the
rebates and discounts that are being
provided by the concerned
organization would enable the same in
retaining the trust and commitment of

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the Norwegian customers towards the
propositions. A fairly weaker force of
substitute propositions are made by
fewer organizations in the economy.
However, the high priced propositions
that are proposed by the same
restricted the businesses in retaining
the competitive edge over the retail
supermarket giants like the concerned
venture. The minimized force of the
substitution in the markets holds a
greater prospect for the concerned
organization in ensuring the market
growth while operating in the
Norwegian markets.
Internal environment of the organization
VRIO analysis
Factors Valuable Rare Inimitable Organization
Competitive
edge
Organizational
model
Yes No No Yes Sustainable
Value Yes No No yes Sustainable
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11STRATEGIC INTERNATIONAL BUSINESS MANAGEMENT
propositions
Highly trained
Human
resource
Yes Yes Yes Yes Strong
competitive
edge
Financial
resource
Yes Yes Yes Yes Strong
competitive
edge
Distribution
network
Yes Yes Yes Yes Strong
competitive
edge
Cost structure No No No Yes Weak
competitive
edge
R&D Yes No No Yes Sustainable
(Source: Lidl.com 2020)
The VRIO analysis aims at identifying the different resources of the organization and the
manner in which the same contri8butes to the efficiency of the organizational operations in
accordance to the needs of the venture. The organizational model of the organization is valuable
and well organized while contributing the sustainable edge of the venture. However,
organizational model is neither rare and nor inimitable as most of the competitors in the retail
industry follows similar business model in their operations. The absence of uniqueness in the
business model would likely affect the capabilities of the organization in gaining a competitive
edge over the existing market players. Likely, the value propositions of the venture are valuable
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12STRATEGIC INTERNATIONAL BUSINESS MANAGEMENT
and organized as the same are planned in accordance with the market demand that is being faced
by the organization in the different markets. However, the value propositions are not rare or
inimitable as most of the competing organizations provide the same range of proposition in
similar prices. The cost structure of the organization is portrayed to be providing the business
with a weaker force of competitive advantage while operating in the different markets as the
increased cost of operations incapacitated the business in maintaining a steady growth of
margins.
The VRIO analysis also identified the sustainable edge that is gathered by the
organization through the R&D operations. The increased R&D operations of the organization
might affect the cost structure while increasing the operational expenses. Therefore, the R&D
operations of the venture is valuable and organized but the operations are not rare or inimitable.
The R&D operations of the organization would allow the same in maintaining the effectiveness
of the business operations in accordance with the innovation based needs of the venture.
Moreover, highly trained human resource, distribution networks and the financial resource of the
organization provided the same with a strong competitive edge. The highly trained human
resource allowed the organization in facilitating the uninterrupted flow of operation in adherence
with the demand of the customers.
Likely, the financial resource of the organization provided the business with a support
while improving the R&D operations of the same while operating in the different markets. The
increased financial resources of the organization also supported the organization in improving
the operational criteria while designing the process flows as per the changing demand of the
customers. The distribution channels of the organization increased the efficiency of the
organization in upholding the availability of the propositions that are made by the same. The

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Omni- channeled distribution related apparatus supported the venture in gaining a strong
competitive edge through improved indulgence of the customers in the different business
activities. The factors supported in recognizing the different resources that might be used by the
organization with the purpose of improving the rate of operations in accordance with the needs
of the venture. Therefore, the VRIO analysis of the concerned organization supported in
developing cognition on the resource based strength of the organization in the context of making
expansion in the Norwegian markets.
Market entry mode
The market entry modes play an important role in improving the organizational
operations while making market expansions. In this connection, the different market entry modes
that might be considered by the concerned organization are licensing, acquisition and joint
venture. The section will evaluate the market entry modes in the light of their benefits and
limitations while choosing the best strategy for the concerned organization to make a market
penetration in Norwegian markets.
Market
entry mode
Concept
Advantages
Disadvantages
Applicability
in the
organization
Licensing Licensing is a
contractual
arrangement
that is used by
an organization
as a market
Lower
amount of
capital
investment
requirements
High return
Lower
control
Loss of
intellectual
property
The licensing
activity would
allow the
concerned
organization in
minimizing the
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14STRATEGIC INTERNATIONAL BUSINESS MANAGEMENT
entry mode
where the
parent business
transfers the
right
manufacturing
and distributing
a product or
service in the
foreign country
to an existing
business
enterprise
(Hollender et
al. 2017). The
licensee
organization
takes the
initiative of
paying a fee for
the rights or a
percentage of
the sales
son the
investments
Quick and
easy means
of
establishing a
market base
Poor quality
management
cost that the
same might
incur while
making
expansion.
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15STRATEGIC INTERNATIONAL BUSINESS MANAGEMENT
(agreed upon
discussions on
a contractual
basis).
Acquisition An acquisition
is a situation
where an
organization
purchase a
portion of the
shares of
another foreign
company with
the purpose of
gaining control
in their own
terms.
Moreover, the
purchase of
shares of a
foreign
organization
would allow an
Reduction of
entry barriers
in the market
Access to
experienced
workforce
and financial
resources
Cultural
clash based
on the
differences
in the
objectives
Damage of
the brand
image
The
application of
acquisition as a
market entry
mode would
support the
organization in
establishing
their expansion
permanently.
However, the
market entry
mode would
also pose a
greater risk to
the sustenance
of the venture
due to huge
capital

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organization in
increasing the
scope of its
expansion
through
captured
synergies (Xie
and Li 2017)
investments,
meant for
purchasing
shares
Joint venture Joint venture is
a form of
market entry
where an
organization
undertakes a
contractual
partnership
with another
foreign entity
with the
purpose of
improving the
rate of
expansion
Reduced
risks while
penetrating in
the
international
markets
(Tulung
2017)
Allows in
accessing the
international
distribution
networks
Minimal
investments
Conflict
between the
contractual
partners
based on
their
differences
in objectives
(Boateng et
al. 2017)
The
application of
joint venture as
a market entry
mode would
allow the
organization in
reducing the
risks of market
entry while
maximizing
the
profitability of
the same in the
Norwegian
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17STRATEGIC INTERNATIONAL BUSINESS MANAGEMENT
while enabling
the profitability
of the same
(Liu 2017).
The objective
of the
organizations
are required to
be similar
while
undertaking a
joint venture
for optimizing
the profit
margins as per
their mutual
interests
Sourcing
skilled
talents, ideas
and other
resources
Would allow
an
organization
in improving
the brand
image
through close
association
with a
reputed
business in
the foreign
grounds (Ahi
et al. 2017)
markets
The assessment of the different market entry modes on the basis of their pros and cons
assisted in identifying the best mode for the concerned organization. The organization might take
the initiative of using joint venture as the market entry mode which would allow the organization
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18STRATEGIC INTERNATIONAL BUSINESS MANAGEMENT
in minimizing the risks that they would incur otherwise due to the financial investments that are
required as per the other entry modes (Lieberman, Lee and Folta 2017). The joint venture of the
organization will be based on a contractual basis where the organization would partner with an
existing retail chain in Norway. The reputation and brand image of the concerned organization
would be increased through the loyalty of the Norwegian customers towards the existing
organization in Norway.
The joint venture would allow the organization in increasing the operations through
reduced risks and minimal investments. The Norwegian markets are saturated with the presence
of huge number of retail chains. Joint venture with one of the retail chains in the Norwegian
markets would allow the business in gaining a competitive edge through transference of brand
value. Moreover, the joint venture would allow the organization in sourcing skilled workforce
from the different sectors of the market. The contractual basis of the market entry mode would
allow the organization in issuing a demerger with the organization and establishing their
independent entity in the Norwegian markets.
Conclusion
Therefore, from the above assessment it might be stated that Lidl’s growth in the
Norwegian markets will be supported through the improved infrastructural facilities and the
development of the ICT apparatus. On the other hand, the increased buying power of the
consumers would allow the concerned organization in gaining a strong market hold in Norway.
The report differentiated between Mexico and Norway while getting an idea on the different
factors that might affect the market environment for the business’ expansion. The research also
recognized the resource based competencies of the organization and thereby selected the best
market entry mode for the same after evaluation of the alternatives.

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References
Ahi, A., Baronchelli, G., Kuivalainen, O. and Piantoni, M., 2017. International market entry:
how do small and Medium-Sized enterprises make decisions?. Journal of International
Marketing, 25(1), pp.1-21.
Appleton, J., 2019, September. Common Globalization Strategies for SMBs Looking to Expand
in Asia Pacific. In SPE Annual Technical Conference and Exhibition. Society of Petroleum
Engineers.
Baysan, C., Burke, M., González, F., Hsiang, S. and Miguel, E., 2018. Economic and non-
economic factors in violence: Evidence from organized crime, suicides and climate in
mexico (No. w24897). National Bureau of Economic Research.
Bladowski, M. and McCowan, R.A., 2017. The Lidl international career opportunity: From
dream to nightmare in eight weeks 1. In The Dark Side (pp. 72-87). Routledge.
Boateng, A., Du, M., Wang, Y., Wang, C. and Ahammad, M.F., 2017. Explaining the surge in
M&A as an entry mode: home country and cultural influences. International Marketing Review.
Gravelle, T.B., 2018. Politics, time, space, and attitudes toward US–Mexico border
security. Political Geography, 65, pp.107-116.
Hollender, L., Zapkau, F.B. and Schwens, C., 2017. SME foreign market entry mode choice and
foreign venture performance: The moderating effect of international experience and product
adaptation. International Business Review, 26(2), pp.250-263.
Huang, J., Hammerbacher, A., Weinhold, A., Reichelt, M., Gleixner, G., Behrendt, T., Van Dam,
N.M., Sala, A., Gershenzon, J., Trumbore, S. and Hartmann, H., 2019. Eyes on the future–
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evidence for trade‐offs between growth, storage and defense in Norway spruce. New
Phytologist, 222(1), pp.144-158.
Jano-Ito, M.A. and Crawford-Brown, D., 2017. Investment decisions considering economic,
environmental and social factors: An actors' perspective for the electricity sector of
Mexico. Energy, 121, pp.92-106.
Kinge, J.M., Sælensminde, K., Dieleman, J., Vollset, S.E. and Norheim, O.F., 2017. Economic
losses and burden of disease by medical conditions in Norway. Health Policy, 121(6), pp.691-
698.
Lidén, H., Stang, E.G. and Eide, K., 2017. The gap between legal protection, good intentions and
political restrictions. Unaccompanied minors in Norway.
Lidl.com., 2020. Grocery Store | Low Prices | Lidl US. [online] Lidl.com. Available at:
https://www.lidl.com/ [Accessed 12 Feb. 2020].
Lieberman, M.B., Lee, G.K. and Folta, T.B., 2017. Entry, exit, and the potential for resource
redeployment. Strategic management journal, 38(3), pp.526-544.
Liu, Y., 2017. Born global firms’ growth and collaborative entry mode: the role of transnational
entrepreneurs. International Marketing Review.
Okabe, T. and Gómez, K.L.M., 2018. Legal framework for industrial property protection and its
importance for regional development in Mexico: Challenges and perspectives.
Puzo, Q., Mehlum, L. and Qin, P., 2018. Socio-economic status and risk for suicide by
immigration background in Norway: A register-based national study. Journal of psychiatric
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Schmid, S., Dauth, T., Kotulla, T. and Orban, F., 2018. Aldi and Lidl: from Germany to the rest
of the world. In Internationalization of Business (pp. 81-98). Springer, Cham.
Shaikh, A.A., Karjaluoto, H. and Häkkinen, J., 2018. Understanding moderating effects in
increasing share-of-wallet and word-of-mouth: A case study of Lidl grocery retailer. Journal of
Retailing and Consumer Services, 44, pp.45-53.
Sun, S., Cegielski, C.G., Jia, L. and Hall, D.J., 2018. Understanding the factors affecting the
organizational adoption of big data. Journal of Computer Information Systems, 58(3), pp.193-
203.
Svalund, J., Peixoto, A., Dølvik, J.E. and Jesnes, K., 2018. Hiring of flexible and fixed-term
workers in five Norwegian and Swedish industries. Nordic Journal of working life studies, 8(3).
Toledo, V.M. and Barrera-Bassols, N., 2017. Political agroecology in mexico: A path toward
sustainability. Sustainability, 9(2), p.268.
Tulung, J.E., 2017. Resource Availability and Firm’s International Strategy as Key Determinants
Of Entry Mode Choice. Jurnal Aplikasi Manajemen, 15(1), pp.160-168.
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Energy, 45(2), pp.1201-1211.
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Xie, Z. and Li, J., 2017. Selective imitation of compatriot firms: Entry mode decisions of
emerging market multinationals in cross-border acquisitions. Asia Pacific Journal of
Management, 34(1), pp.47-68.
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Appendices
Appendix 1: PESTLE analysis of the two countries- Norway and Mexico(1250 words)
Factors
Norway
Score
(Scale 1-5/
very strong
advantage
being 5 and
very weak
advantage
being 1)
Mexico
Score
(Scale 1-5/
very strong
advantage
being 5 and
very weak
advantage
being 1)
Political Norway is a
politically stable
nation with lower
rate of government
intervention in the
different business
operation in the
economy. The
increased free
economy related
legislation in the
organization would
permit the nation in
5 Partial political
instability is one of
the major concerns
that might be faced
by an organization
while operation from
the Mexican markets
(Toledo and Barrera-
Bassols 2017).
Moreover, the
increasing rate of
corruption and
terrorism activities
3
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24STRATEGIC INTERNATIONAL BUSINESS MANAGEMENT
improving the
foreign investments
through associative
partnership between
the private and
public enterprises.
The political stability
index of the
concerned nation was
1.15 in the year 2018
(Lidén, Stang and
Eide 2017). The
increased political
stability of the nation
would influence the
growth of the
different
organizations in the
economy.
in Mexico might
affect the capability
of any organization
to make an
expansion in the
economy. It has been
observed that
corrupted activities
among the
judiciaries,
politicians and
several
governmental and
non-governmental
institutions have
stained the public
image of the nation
(Gravelle 2018).
However, Andrés
Manuel López
Obrador has been
taking steps to
minimize the rate of

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25STRATEGIC INTERNATIONAL BUSINESS MANAGEMENT
corruption for
improving the
prospects of FDIs in
the economy. Again,
the regeneration of
the NAFTA
agreement supported
in influencing the
growth of business
relations between
USA and
Mexico(Gravelle
2018). The
regeneration of the
NAFTA agreement
between Mexico and
USA might increase
the prospects of
growth of the
businesses.
However, the
increasing crime
rates and corruption
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26STRATEGIC INTERNATIONAL BUSINESS MANAGEMENT
in different public
and government
sectors might expose
a business to
different risks.
Economic The GDP of the
Norwegian economy
grew after two years
of economic
downturn by 1.9% in
the year 2019 due to
the expansion of the
non- oil sectors. The
minimization of the
corporate taxation to
23% increasingly
supported the growth
of the businesses
(Kinge et al.
2017).The economic
growth of the nation
holds greater
prospects of
4 The nation, Mexico,
is a member of the
G20 and is
15th biggest
economy in the
world (Weforum.org
2014). The GDP of
the nation was
calculated to be US$
1,223.36 billion and
US$ 1,158.23 billion
in years 2018 and
2017 respectively
(Baysan et al. 2018).
It has been observed
that the growing
average rate of GDP
was 4.25 % (Jano-Ito
3
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27STRATEGIC INTERNATIONAL BUSINESS MANAGEMENT
corporate growth. It
has been observed
from a report that the
nation procured
9thposition in
financial markets in
the year 2014 and
specific
developments in the
later years
(Weforum.org 2014).
The advanced
economic growth of
the economy might
be attributed to the
growth of the service
sectors apart from
the oil and gas
manufacturing
sectors. Moreover,
the growth in the
inflation rate of the
economy improved
and Crawford-
Brown 2017).
Moreover, it has
been noted that the
concerned nation is
open to FDIs while
increasing the
prospects of growth
for the businesses.
The growing number
of FDIs and lack of
financial restrictions
like stringent
taxation rates
allowed the nation in
attracting the
attention of the
businesses,
worldwide.
Mexico’s banking
system ranked 30th in
the report made by
the World Economic

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28STRATEGIC INTERNATIONAL BUSINESS MANAGEMENT
the buying power of
the consumers in the
nation. The
improvements in the
GDP rate would
allow the growth of
the business while
influencing the rate
of disposable income
among the
customers.
Forum in the year
2014 which has
created prospects of
growth for the
businesses in the
Mexican markets
(Weforum.org
2014). However, a
Value-Added Tax of
16% is applied to the
retail goods and
services in most
parts of the economy
(Gravelle 2018).
Social The changes in the
preferences and
tastes of the
customers might
affect the operational
efficiency of the
organizations. The
higher rate of
4 The Mexican
government has
taken the initiative
of improving the
literacy rates among
the different
population.
However, the lower
3
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29STRATEGIC INTERNATIONAL BUSINESS MANAGEMENT
disposable income
among the people in
the nation has backed
the buying power of
the same. Again the
educed rate of
unemployment in the
nation from 4.2% in
2017 to 3.6% in 2019
has empowered the
buying power of the
consumers in the
economy (Puzo,
Mehlum and Qin
2018). Moreover, the
minimization of price
sensitivity among the
customers and their
increasing demand
for quality
propositions is an
increasing prospect
for any business
disposable income
among majority of
the people in Mexico
might be attributed
to the increased rate
of unemployment. It
has been observed
that the
unemployment rate
of the nation is 4%
in the first quarter of
2020 which has
affected the
affordability of the
customers (Sun et al.
2018). The
minimized
affordability of the
customers in the
Mexican economy
might affect the
capability of the
organization in
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30STRATEGIC INTERNATIONAL BUSINESS MANAGEMENT
improving the rate of
expansion in the
different regions and
markets. Again, the
government under
Andrés Manuel
López Obrador took
the initiative of
minimizing the
crime rates through
different measures.
However, the rising
crime rates and
corruption in the
different public and
private sectors left a
detrimental impact
on the organizational
efficiency. Again,
the shifts in the
preferences of the
customers might
affect the capability

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31STRATEGIC INTERNATIONAL BUSINESS MANAGEMENT
of the organization
in increasing the
effectiveness of the
business operation in
accordance with the
needs of the venture.
Technological The nation made
notable
improvements in the
ICTs, with increasing
Internet bandwidth
and greater
penetration of mobile
broadband,
empowered the
growth of business
organizations in the
economy
(Weforum.org 2014).
The World Economic
Forum ranked the
economy to be 33rd
5 The innovation
capacity is low in
Mexico and is
thereby ranked to be
75th by the World
Economic Forum in
their reports
(Weforum.org
2014). However, the
reasonably good
transportation
infrastructure
ranking 39th as per
the reports of the
Forum in the year
2014 would allow
4
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32STRATEGIC INTERNATIONAL BUSINESS MANAGEMENT
and 22nd for
infrastructure and
R&D respectively
(Weforum.org 2014).
Therefore, the
technological and
infrastructural
growth facilities in
the economy would
facilitate the growth
of the corporations in
the economy.
the businesses in
improving the
supply chain and
networking
operations in the
markets
(Weforum.org
2014). However, it
has been also
observed that the
insufficiency of
educated and skilled
workforce might
affect the
capabilities of the
organizations in
empowering the
operational
efficiency.
Moreover, the
absence of effective
workforce planning
might be the result to
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33STRATEGIC INTERNATIONAL BUSINESS MANAGEMENT
a range of
operational
efficiency and
incapacitate the
organizations in
empowering the
innovativeness of the
same. One critical
challenge that is
being faced by the
organizations in
Mexico are related
to the lack of
sufficient
penetration of
broadband services
which curtailed the
promotional
capabilities of the
businesses.
According to a
report by Sun et al.
(2018), the Mexican

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34STRATEGIC INTERNATIONAL BUSINESS MANAGEMENT
economy is still in
its developmental
stage, with
minimized
innovation or
infrastructural
supports. In this
connection, the cost
of operations of the
organizations might
rise with the
growing needs of
establishing their
own infrastructural
systems.
Environmental Norwegian
government and
different
environmental
protection agencies
have taken the
initiative of imposing
3 The Mexican
government took the
initiative of
enforcing different
environmental
protection
legislations under
3
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35STRATEGIC INTERNATIONAL BUSINESS MANAGEMENT
different
environmental
protection related
stringent legislations
with the purpose of
regulating the
activities of the
businesses. In this
connection, the
application of Nature
Conservation Act
1970, Product
Control Act 1976,
Pollution Control Act
1981, Environmental
Information Act
2003 and
Greenhouse Gas
Emissions Act 2007
fostered the growth
of the businesses in
the context of
environmental
General Law on
Ecological
Equilibrium
and Environmental P
rotection with the
purpose of
minimizing the
degradation related
issues (Okabe and
Gómez 2018).
Legislation related
waste management
and other emission
standards are being
imposed by the
government with the
purpose of
minimizing the
effects of the
organizational
operations resulting
to environmental
degradation
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36STRATEGIC INTERNATIONAL BUSINESS MANAGEMENT
requirements
imposed by the
government in the
nation (Ulleberg and
Hancke 2020).
Legal The Norwegian
government
maintains integrity
through clarity of
communication and
transparency in the
processes. In this
connection, different
employment
legislations and
corporate governance
regulations are being
imposed for the
uninterrupted
functioning of the
business processes
(Ulleberg and
Hancke 2020).
4 The Mexican
Government have
taken the initiative
of imposing different
legislations for the
businesses like
product or service
safety legislation,
consumer’s right to
information and
legislations for
minimizing the
fraudulent activities.
The legislations are
being imposed by
the government with
the purpose of
improving the
4

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37STRATEGIC INTERNATIONAL BUSINESS MANAGEMENT
Transparency of the
procedures would
allow the growth of
organizations in the
economy
operational
efficiency of the
organizations while
operating in the
context of the
Mexican markets.
Total score (Score Out of 30) 25 (Score Out of 30) 20
Appendix 2- Economic state of Norway
Table 1: Economic projections of Norway
(Source: Ulleberg and Hancke 2020)
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38STRATEGIC INTERNATIONAL BUSINESS MANAGEMENT
Appendix 3- Economic state of Mexico
Table 2: Economic projections of Mexico
(Source: Jano-Ito and Crawford-Brown 2017)
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