Risks and Rewards: Marketo's Investment in the Irish Market

This report examines the global business environment, focusing on Marketo's investment in the Republic of Ireland. It identifies and analyzes key risks, including cross-cultural, country, currency, and commercial risks, that Marketo must consider before making its investment decisions. The report also explores measures to mitigate these risks, such as acquiring cultural knowledge, assessing political and legal environments, and seeking expert advice. Furthermore, it outlines the positive aspects of the investment, such as Ireland's pro-business environment and attractive tax rates, and the negative aspects, such as potential political risks and management structure challenges. Finally, the report considers alternative forms of internationalization, such as licensing and franchising, that Marketo could employ. The report concludes by emphasizing the importance of understanding cultural differences and the strategic advantages Ireland offers as a European base for businesses.

GLOBAL BUSINESS
ENVIRONMENT

Table of Contents
INTRODUCTION...........................................................................................................................1
The risks that is to be considered before making investment decision.......................................1
The measures that can be taken to overcome the risks ..............................................................2
The positive and negative of investment decision......................................................................2
Alternative forms of internationalisation....................................................................................3
CONCLUSION................................................................................................................................3
REFERENCES ...............................................................................................................................4

INTRODUCTION
The global business environment can be termed as the environment in distinct sovereign
countries with factors exogenous to the home environment of the organization on the use of
resources and capabilities it influences decision-making (Story and Bovaird, 2014). In the both
external and internal environment the global business environment can be classified. The social,
political, regulatory , tax etc comes in external environments.
In the world's most globalized country recently Ireland replaced Singapore and in order to
conduct business it is considered to be in the top 10 countries. In this property Marketo is
intended to conduct expansion of FDI in the republic of Ireland. The risks will be analyzed
before making any decision of investment. The positive and negative areas for the decision that
is been taken by Marketo to invest in Ireland will also be analysed.
The risks that is to be considered before making investment decision
There are four risks that need to be concerned by the Marketo as per the case study before
marketing investment decision in the republic of Ireland .They are as follows-:
Cross-cultural risk – In the human value is put on stake due to miscommunication in culture. The
decisions-making styles may differ in both these countries that is in Ireland and California. The
ethical practice can also be not same in these countries. So, all these things that is cultural
difference, decision-making styles, ethical practices concerns in the cross-cultural risk (Sidani
and Al Ariss, 2014) .
Country risks – By development in the factors such as political , legal , economic factors in a
foreign country there can be adverse effects on the operation and preferably of the company. As
per the case study the company Marketo can face risk related to harmful or unstable political
system. And also the judiciary system may be not adequate or it may be under developed. In the
political system the sources of country risks can be government, political parties and in legal
system the sources of country risk can be laws and regulation that aims to solve disputes.
Currency risk – In the exchange rates there is a risk of adverse unexpected fluctuation. The
foreign taxation and inflation and transfer pricing risks will come under currency risks.
Commercial risk – From the poorly developed or executed strategies , tactics or procedures of
business may have loss or failure. There is a risk for Marketo related to poor execution of
strategy, operational issues, weak partner etc.
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The measures that can be taken to overcome the risks
In order to take measure to solve the cross cultural risks the following things need to be
done .They are as follows-:
 About the other culture the factual and interpretive knowledge need to be acquired. Their
language need to be speak so that to be aware about their culture more as per the case
study it will help the Marketo to get to know more about republic of Ireland.
 The cultural bias need to be neglected (Meyer and Peng, 2016.).
 The cross-cultural skills need to be developed such as adaptability, interpersonal skills
etc.
 The self-reference criterion need to be developed. Through the lens of one's own culture
the other cultures need to be viewed.
In order to reduce the impact of country risk all these measures need to be taken-:
 In target countries the management should develop a comprehensive understanding of the
political and legal environment .The ongoing political risks need to be assessed and also
the threats to the firm by making use of intelligence sources such as working of
employees in the host county, consulting forms etc.
 The exposure to the country risk need to be minimized (Doing business in Ireland,
2017).
 The business which involves in the questionable practice or conduct business outside the
also invite redress from the government of the host counties which they do business. The
protection can also be done through legal contracts such as conciliation. In a friendly
manner it will resolve the difference.
In order to minimize currency risk the expert advise need to be seek and within MNE centralize
the current management (Kolk, 2016).
The positive and negative of investment decision
As per the given case study Marketo which is a global leader in revenue performance
management has opened a new hub in Dublin and ha selected the Ireland as their European
based. The positive traits of this investment are as follows-:
 The business environment in Ireland is welcome and the workforce are highly educated,
 The beige tax environment is been offered by Ireland. This make Ireland the easy
opportunity for the business.
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 Ireland has a pro-business environment, an attractive tax rate
 Ireland is been selected by many of the best-known world brands as their strategic
European base.
 In attracting investment in ICT, Life sciences Ireland have a strong track record.
 With most highly employable graduates in the world Ireland boosts a young, educated
and flexible workforce (Kasemsap, 2016).
 For the companies investing in abroad the tax regime in Ireland is simple, transparent and
attractive.
The negative points can be as follows-:
 There may be a grater exposure to political risk and the there may also be difficult
management structure.
 Between the partners the knowledge transfer may be less straight forward
Alternative forms of internationalisation
The alternative form of internationalisation that can be considered by Marketo can be -:
Licensing – In this the right to use that properly for a particular period of item is been granted by
the owner of intellectual properly in exchange of royalties or other compensation. The
advantages of licensing for the business sit that investment and involvement will be low and
once established there will be low effort (Cavusgil and Knight, 2015).
Franchising - In exchange of fess, royalties or other compensation the firm allow another to
make use of an entire business system. The advantage of using this will be that to many market it
can rapidly internationalize and once establish it will low effort.
CONCLUSION
Thus summing up the above report it can be concluded that due to cultural
miscommunication the human value is put on stake. The language, beliefs, ethical practice can
be the risk that is there due to cultural difference. Ireland is been selected by many of the best-
known world brands as their strategic European base. The licensing and franchising can be
selected by Marketo as an alternative forms of internationalisation.
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REFERENCES
Books and journals
Cavusgil, S.T. and Knight, G., 2015. The born global firm: An entrepreneurial and capabilities
perspective on early and rapid internationalization. Journal of International Business
Studies, 46(1), pp.3-16.
Kasemsap, K., 2016. Fostering supply chain management in global business. Handbook of
research on global supply chain management, pp.45-71.
Kolk, A., 2016. The social responsibility of international business: From ethics and the
environment to CSR and sustainable development. Journal of World Business, 51(1),
pp.23-34.
Meyer, K.E. and Peng, M.W., 2016. Theoretical foundations of emerging economy business
research. Journal of International Business Studies, 47(1), pp.3-22.
Sidani, Y. and Al Ariss, A., 2014. Institutional and corporate drivers of global talent
management: Evidence from the Arab Gulf region. Journal of World Business, 49(2),
pp.215-224.
Story, J.S. and Bovaird, J.A., 2014. Meeting the challenges of effective international HRM:
Analysis of the antecedents of global mindset. Human Resource Management, 53(1),
pp.131-155.
Online
Doing business in Ireland. 2017. [PDF]
<http://www.matheson.com/images/uploads/documents/Doing_Business_in_Ireland_Guide.pdf/
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