University International Business: Competitive Advantage Report

This report delves into the realm of international business, specifically focusing on the competitive advantages of construction contractors in the United Kingdom, India, and Brazil. It explores how these firms leverage operational tools, innovation, and environmental factors to gain an edge in the global market. The report also analyzes the external environment, including political, economic, socio-cultural, technological, environmental, and legal factors, impacting businesses like the Shangri-La Hotel group's expansion into Ethiopia. Furthermore, it addresses potential challenges in international procurement and joint ventures, such as supplier identification and strategic planning, offering insights into risk management within the construction industry. The report encompasses various aspects including the assessment of a hospital project in Albania, offering valuable insights for students.

Running head: INTERNATIONAL BUSINESS MANAGEMENT
International Business Management
Name of the Student
Name of the University
Author Notes:

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Table of Contents
Answer 1..........................................................................................................................................3
United Kingdom..........................................................................................................................3
INDIA..........................................................................................................................................4
Answer 2..........................................................................................................................................7
External environment...................................................................................................................7
Answer 3........................................................................................................................................12
Advantages................................................................................................................................12
Employment opportunity.......................................................................................................12
Controlling expenses.............................................................................................................13
Acquaintance with the local regulations................................................................................13
Market expansion...................................................................................................................14
Disadvantages............................................................................................................................14
Compromising Quality of the Resources...............................................................................14
Time constraint......................................................................................................................14
Difference in work culture.....................................................................................................15
Unfavourable word of mouth.................................................................................................15
REFERENCES..............................................................................................................................16

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Answer 1
Many construction firms have achieved competitive advantage over other firm when
seeking to win new work areas. Construction firms in various parts of the world has gained much
profits and has successfully satisfied their clients with the help of the operational tools like the
total quality management, bench marking and reengineering. The usage of these methods in the
construction industry has helped them to achieve success in the recent years. With the help of the
operating tools the construction firms has resulted in higher productivity, better productivity,
gaining goodwill with the employees and clients with their faster project deliveries in the
business market (Jennings and Beaver 2015). However the present topic which will be discussed
in the research paper is how the construction industries have gained a competitive advantage
over its competitors with the help of the operational effectiveness. This means that performing
the same work and similar activities far better than the rival firms in business market. This
research paper aims to study the factors that create the competitive advantage of construction
contractors in United Kingdom, India and Brazil.
United Kingdom
Contractors from various companies in United Kingdom achieve competitive advantage
for engineering and construction contractors through their acts of innovation. The contractors in
United Kingdom approach innovation in a broader sense. They includes both the usage of latest
technologies and modern ways of doing things in their work. They are known to be perceiving a
new road of competing things and finds better ways of accomplishing and completing things.
This helps them in gaining advantage over the companies which are known to be using the older
means of technologies and work models. Innovations can be include in various ways of working
like implementing innovation in product designs, finding out a new production process,

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opportunities in finding out new marketing approach or it can also be a new of conducting a
leadership and training process for the employees. Innovations help the contractors in the country
to gain a competitive advantage over the rival industries. According to Boxall and Steenevel
(2014) innovations in UK contractors does not only involve in developing and implementing
new ideas which are in the market, but implementing those ideas in work which was never
pursue by any other person in the industry. The contractors in UK are known to invest a huge
sum of money in developing skills and knowledge in their employees. The investments also
include spending money in the research and development of new machineries and physical assets
which are different and innovative from the competitor companies. Therefore this helps in the
brand reputation. Few innovative factors in innovations by the contractors in UK has helped
them to create competitive advantage over others. One of the most famous construction company
in UYK is The U.K Construction Private Ltd which has perceived the market by creating
innovative and entirely new market opportunity in order by serving the market segment which
was ignored by other competitors till date. The competitor construction industries have lowered
down their response in the market segment. With the use of latest innovation technologies and
skills U.K Construction Company has created a competitive advantage of the market segment.
INDIA
The environmental factor condition has led the constructors in India to gain a competitive
advantage over others. According to Shaw et al., (2016) the factors which has led the contractors
in India to gain a competitive advantage over the rival firms are mainly the easily accessible low
cost labour, abundant natural resources and vast stretches of land capital and use of the
innovative infrastructure. These are the determinants which determine the smooth flow of the
trade. India is known to export these factors which the nation is easily endowed with. In the

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sophisticated industry like the construction industry which forms a backbone in any advanced
economy. The construction industry in India does not inherit; instead it creates the most
important factors for gaining the competitive advantage over the other industries. Factors like the
availability of skilled human resource or a scientific base are important is advancing in the
construction industry. Also the efficiency and effectiveness of the skilled labour and workers
with the construction firms are the stocks of factors which the constructors enjoys at a particular
time. In the words of Shobaki and Naser (2017) few famous construction industries in India are
also known in using their rate of efficiency in their work which it creates, deploys and upgrades
them in their industry and workplace. Through the use of advanced technologies and upgraded
skills and knowledge of the constructors in India has created a constitution of advantage in the
knowledge intensive based industry like the construction industry. Huang Dyerson and
Harindranath (2015) has concluded that in order to support the competitive advantage over other
competitors in the market the factors which the nations has specialized in should be highly
innovative in order to gain over the competition. In a growing nation like India, one of the most
famous construction company Larsen and Toubro has its own scientific institutes where the
institutes where the company is dedicated in developing more innovative technologies. The
company is also known for funding few of the software industries available inside the country.
These are factors which are found in the constructors of India which seems to be are more scarce,
and difficult to be found in foreign competitor countries to imitate (Argote and Ingram 2016).
The factors which has helped the engineering and construction constructors gain a
competitive advantage over the rivals is the most structural features of Brazilian industry which
has remained to be unchanged except in the managerial process of production. The ownership
structure of the firms in Brazil are modernized as the rationalization and inward

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internationalization are generalized. It can also be said that Brazil might face a development
paradox in the recent years which are yet to come. The arrangements of the local capital coupled
with the benefits of the innovation capabilities of the engineering construction contractors are
some of the outstanding features of Brazil which has led the contractors achieve a competitive
advantage over others (Carney, M., 2015). The increase in the privatization of the steel industries
and engineers along with different kind of mergers and acquisitions has changed the ownership
landscape of the commodities in industrial groups. Even when the engineers and construction
contractors are compared with the international market, the Brazilian firm and institution remains
to be seen in a smaller size and they are too much oriented in the local market only. Further the
factors like leading to the greater concentration in the market has liked the engineering industries
and construction contractors gain a competitive advantage over the rival industries. The
substantial investment drive of the companies in their research and development gaps has led to
create a higher unit value to the products and services offered by the companies. Applying and
implementing the latest technologies in the products and service provided by the companies has
let the companies in creating a better quality of products. Modernization and foreign owned
operating systems has relatively gained an advantage for the engineering and constructions
contractors industries in Brazil (Barney 2018).
In order to conclude the above research paper it can be said that the competitive
advantage gained by a company tends to be short lived because other companies are sure to
imitate it. For instance the construction companies should develop programs which maximize the
potential of the employees.

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Answer 2
The aim of Shangri-La Hotel group is to initiate operation in the Ethiopian city of Addis
Ababa. The latter have been able to locate that the contractors of the country and of insufficient
size, which would lead to hindrances and setbacks for the motive of the company. The former
aim to establish a futuristic five star hotel with the newly located contractor from China. The
latter will supposedly take a joint venture while taking up the project. Thus, the success of the
project would be determined by the degree of collaboration between Shangri-La hotel group, the
Chinese contractor and the local Ethiopian contractor. Just as every international procurement
and joint venture program, the motives of the company is subject to certain challenges (Hu, D.
and Xu 2013). If all the parties ensure that they can effectively meet the challenges, the proposed
project will turn out to be a success.
External environment
The external environment that a company operates in determines the nature of operation
of an organisation or an assimilation of organisations. The political, economic, socio-cultural,
technological, environmental and legal factors of a country determine the effectiveness of
operations of a company who are looking to procure new business operation in a foreign locality.
Political factors (Østebø, Cogburn and Mandani 2017)
 Taxation policies of the country are considered low as compared to other companies. This
resulted in increasing amount of investment in research and development.
 Political collaboration with local organisation in order to enhance the local GDP.
 The governance system of the country is facing challenges related to stability.
 Incidence of armed conflict in the country.

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Economic factors (Rehima et al. 2013)
 Liberalisation of international trade policies in the country which helps in attracting
foreign direct investment.
 The exchange rate of the currency of the country is considered to be volatile.
 Availability of expertise in the country in the form of sales and marketing.
 The rate of inflation in the country is rising.
 Availability of skilled and unskilled labour that can be deemed as a competitive
advantage for the country.
Socio-cultural factors (Berhan and Berhan 2014)
 Education is prioritised in the country thus, the literacy rate in the country is high.
 Multiculturalism is negatively practiced in the country. The country has unfavourable
attitudes towards immigration.
 The citizen of the country have high affinity towards leisure activities. Thus, a bulk of the
production of the country is segregated for leisure activities and the leisure industry.
 Traditional media, as well as social media plays a crucial role in in persuading people of
the country.
Technological factors (Bultum 2014)
 High degree of technological innovation.
 The intellectual rights and properties are protected through patent and property protection
frameworks.
 Technological up gradation in the country is weaker compared to other developing and
developed countries.

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Environmental factors (Godana and Mengiste 2013)
 The country employs the use of renewable forms of technology.
 There exists high degree of regulation
 Government intervention in the environmental protection activities.
 Government expenditure is allocated
Legal factors (Holden and Ghebru 2016)
 Presence of employment laws in the country
 Environment protection laws
 Laws of protection of intellectual property
 International norms
 Data protection laws that protect the country against corruption and piracy.
Following are the issues that can be faced by the Shangri-La hotel group in the company’s
motive of procuring a five star hotels in Ethiopia (Harland, Telgen and Callender 2013).
1. Identification of the suppliers: Problems associated with the identification of suppliers of
a company is one of the most common problems that are faced by companies who aim to
participating and establishing business in a goring country. It is necessary to check the
backgrounds of the suppliers before engaging in contracts as the efficacy of the latter
determines the success of the supply relations and ultimate operations of the company.
2. Strategy: Market research should be carried out to assess the most viable strategies that
can be carried out by the company to ensure acceptance and profitability of the operations
of the country. The key area of importance is the identification of the value that the

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companies are being able to create for the locals of the country. Hence, the strategies
should be formulated and created accordingly.
3. Checking the expenses: In the initial days of operation of a company on foreign territory,
most of the businesses are assumed to face difficulties in operations. However, effective
strategies can be adopted through which the latter can be avoided. It is one of the most
challenging tasks for companies to keep up with the revenue requirements of the firms. In
order to do the same, the companies check their expense. It can be done by ensuring that
the firm is minimising the wastes and contributing productively to the needs of the
company and the customer community.
4. Risk management: Regardless of the nature of operations of the business, there are risk
that can arise. The risks that can affect the firms directly or indirectly. Some are more
threatening to the sustainability of a firms than the others. Risks can be segregated in to
manmade and natural risk, financial or operational risk and many other sectors of risks.
The companies should look to mitigate the issue related to the safety and wellbeing of the
stakeholders of the organisation. Carrying out the latter helps organisation to sustain
themselves in the short and the long run.
5. Resourcing: It implies to location and allocation of both tangible and intangible resources
as well as human resources. The same can be linked with the identification of suppliers
who contribute to solving the issues that are associated with resourcing. Furthermore,
employing the suitable personnel in the organisation is crucial. Experience and able
Human resource practitioners can help in the recruiting and selection. However, there
arise issue related to resourcing of human capital in an industry that is deemed to have
negative attitudes towards migration and cultural tolerance.

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However, it can be said that there can be issues that arise when organisations with large scale
operations collaborate with small companies. The companies that are smaller in stature take time
to establish relations with the suppliers in the market. Furthermore, the smaller companies cannot
match the level of operations of the company that are established as large scale companies. The
levels of expectation that the bigger company might have with the collaboration might be unlived
due to the inexperience of the company that the latter are associated with. Furthermore, the scale
of operations of both the companies might not match as well. Moreover, the companies who are
involved in the collaborative organisations are subject to different relations with the public that
might not coexist when the companies exists in collaboration. There can be incidence of a
scenario when the smaller company in contention might get overshadowed by their larger partner
which might lead to demotivation within the members of the smaller company.
In conclusion, it can be said that the operations of Shangri-La Hotel group are subject to the local
conditions that are prevalent in Ethiopia. Thus, it is necessary for the parties associated in the
venture to effectively assess the issues that can hinder the performance of the strategic initiatives
of the company and formulate strategies accordingly.

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Answer 3
Local content can be defined as the resources that are available for the utilisation of a
company when they indulge in international courses of operations (Hufbauer, Schott and Isaacs
2013). The use of local content is encouraged by the local governing bodies. It is one of the most
significant factors that a company has to deal with when they aim to spread their international
boundaries. With the expansion of international boundaries of the company, the need for
requirement of local content is appreciated in the company. There are various government
regulations that encourage the use of local content in the operations. This has been perceived as
a hindrance to the attraction of foreign direct investment in a country. On a contradictory note, it
can be said that the encouragement of local content should be encouraged in order to sustain the
well-being of a company in the long run. The wellbeing of the employees helps in contributing
the growth needs of the growth of the economy of the country and provides opportunities to the
component of the economy that contribute to the sustainability of the economy as a whole.
However, it can be said that there are advantages and disadvantages based on the perspective that
the matter is being adjudged. Following are the advantages and the disadvantages related to
sustaining local content clauses in a construction contract for a project that is being carried out in
a developing country such as India or Brazil.
Advantages
Following are the advantages related to local content clauses in terms of operations of a
construction company in a developing country (Wang et al. 2014);