International Business Expansion: Strategic and Environmental Analysis

This report provides an in-depth analysis of international business expansion, focusing on the strategic and environmental imperatives that drive organizations to operate globally. The report identifies key strategic imperatives, including diversification, brand identity enhancement, geographical expansion, market share and growth, competency building, and risk sharing, explaining how each contributes to a company's international success. Furthermore, the report examines the environmental imperatives, categorizing them into political, legal, economic, and social factors. It analyzes how these factors influence a corporation's decision-making process when entering and operating in international markets, providing examples of how companies navigate these complex landscapes. The report underscores the importance of understanding these factors for effective international business management.

MANAGING INTERNATIONAL BUSINESS

Table of Contents
Introduction..........................................................................................................................................4
Task.......................................................................................................................................................4
Q.1 Identifying why organizations expand internationally through considering strategic
imperatives.......................................................................................................................................4
Q. 2 Analyse why corporations expand globally by considering environmental imperatives........6
Conclusion............................................................................................................................................9
References...........................................................................................................................................11

Illustration Index
Illustration 1: Legal factors..................................................................................................................7

INTRODUCTION
Managing international business is essential for any organization to achieve market
leadership and remain competitive in the national and global market. It also helps the corporation to
increase its sales in various markets. It contribute effective role for the enterprise to understand
political, social, economic as well as technological environment of various nations. In addition to
this, managing international business also help the enterprises to increase innovation capability and
in adopting advance technology in national and international market (Wild, Wild and Han, 2014).
The present file identify the why organizations expand globally by considering strategic and
environmental imperatives.
TASK
Q.1 Identifying why organizations expand internationally through considering strategic imperatives
Corporations have many strategic imperatives like diversification, increasing brand identity,
risk sharing market share and growth as well as competency to expand globally which help to
increases their business in the world.
 Diversification- It is also important factor to expand organizations in the world. It also helps
the firms to take entry in the new field for doing business in the many states. It can be also
helpful to expand the business of company in various countries. In addition, it contribute
effective role for enterprises to achieve diversified knowledge which help to develop and
design its goal and objectives for international market. This way, organization can increase
its business various fields (Cavusgil and et.al., 2014). For example, Nokia organization was
in rubber business. Then after, enterprise select electronics market to expand its business in
diversified area. This way, corporation has expanded to sell its mobile phones in many
countries. Nokia gets huge profit by doing this business in the world with help of this
strategy. So diversification strategy can aid the firms to expand globally through considering
this strategic imperative.
 Increasing brand identity- This factor can be important for organizations to increase its
global activities. Company can spread its name as brand in many nations with help of this
strategy. This way, corporation can expand internationally to enhance business transactions
with its clients. This strategy contribute effective role for firm to become popular
organization in the world. It also helps the enterprise to increase its revenue by selling more
products in the world (Verbeke, 2013). For example, Sony organization uses this strategy to
increase its brand identity and value by maintaining appropriate quality in electronics
gadgets in many countries. This thing helps the firm to increase its sales by increasing brand
awareness in global and national consumers. This way, Sony increases its income level as

comparison of previous years by adopting this strategic imperative in various nations. Now
many consumers are purchasing mobile phones, LED and other products due to higher brand
identity of Sony electronics in the world (Dunning, 2013). This way, organization can spread
its business activities by using brand identity strategy in many states.
 Geographical expansion- It plays important for many organizations to expand their business
in many global areas. Company can increase its global movements in various nation. To
implement this thing, corporations can talk with many governments of nation to take entry
for conducting business after analysing positive results regarding business in specific
countries. This strategy can also help the many enterprises to increase customer stake in
many global areas. This way, organization can increase its business transactions with
consumers by selling more products in the many nations (Carroll and Buchholtz, 2014). For
example, Samsung electronics also uses this strategy to expand its business internationally.
By using this strategy, organization has expanded for doing appropriate business in many
countries. This thing is helping the company to enhance its business activities in the various
global areas. With help of this strategy, Samsung also has developed many global
relationships with many governments. These things are aiding the organization to earn more
profit and managing its global operations in the many countries.
 Market share and growth- This aspect can also help the enterprises to increase its presence
in global market. It contribute effective role for firms to enhance market percentages by
selling more units in specific industry. This way, organization can increase its market share
in many countries. Increased market share provides effective opportunities to achieve more
profits through increasing sales of products in different market sector. As per market share,
organization can grow in a appropriate manner in specific industry (Peterson, Arregle, and
Martin, 2012). For example, Apple electronics organization increases its market share by
using this strategic imperative in many countries. To increase market share, organization is
also developing lower range smart phones and other electronics products to increase its
presence in the global area. With help of this strategy, Apple has entered in many developing
countries such as India as well as Brazil to increase its market share and growth by selling
more smart phones, laptops and computers. This way, enterprise is getting effective market
share and growth in many countries.
 Competency-Organization can use competency factor to expand globally. Mainly, Enterprise
are designing and developing new technologies on the basis latest innovation by using
extensive market research. This process provide effective reliability to know the consumer
requirements in the various nations (Hill, Cronk and Wickramasekera, 2013). It also

provides new platform to develop new products and sell into the international market for
getting better income in the various countries. There are many corporations in the world
who are using this strategic imperative to expand its business internationally (Foss and
Knudsen, 2013). For example, Motorola always create new innovations to attract its new
consumers in the world. On the basis of this strategy, organization has created distinct brand
identity in the customers minds. This thing is also helping Motorola to expand its business
activities globally. It contribute effective role for enterprise to increase its market share and
growth as comparison of previous years in the many countries.
 Risk sharing- This factor is also important for organization to spread its business activities
in the world. This thing reduces profit risk of companies by expanding globally. It also helps
the organizations to save its income in many countries (Mendenhall and Osland, 2012). For
example, Hewlett Packard (HP) is multinational organization. In 2008, when United
Kingdom and many other nations are suffering with economic recession due to shortage of
monetary funds. In that time, there were many countries such as India who are not facing
economic recession. At this time, this organization also earn effective profit by selling more
electronics product in the India. This way, HP reduce its risk due to expansion of many
countries. This factor contribute effective role for firm to increase its international
operations for reducing overall risk
Q. 2 Analyse why corporations expand globally by considering environmental imperatives
There are many environment imperatives like political, economical, social, technological,
environmental as well as legal which are necessary for corporations to consider for going
international. It represented below the paragraph.
 Political- These aspect plays for important role for organizations to spread its operations in
the world. Generally, these conditions are essential for corporation to enter in the global
market. In addition, organization also check many political factors like level of corruption,
trade laws like income tax, political stability of government, rules and regulation of different
nations to expand its business in particular country. There are many organizations who
consider these factor before going global (Political Factors, 2015). For example, United
Kingdom is best place for corporations for doing business. In addition, many organization is
coming to conduct its business in order to earn profit in Britain. Intel and Dell enterprise
also checked these aspects to establish its business in the country. Generally, corruption
level, political stability, rules, regulations as well as trade laws of this nation is flexible for
any organization (Majaro, 2013). For, example, corruption level of UK does not more high.
These things creates less complexities for global organization to establish its business in the

Britain. Government of United Kingdom also provide effective guidance to set its new
business. In addition, corporation tax of this nation is very less as comparison of other
nations in the world. So political factors are necessary for enterprise to earn effective profits
from the market. In addition, all industries are better conditions for starting new business as
comparison of other countries. So organization feels fewer complexities to operate its
business in the United Kingdom (Enderwick, Tung and Chung, 2011). This way,
corporations can get appropriate success in the market of UK as per political factors.
 Legal-
(Source: Legal factors, 2015)
 There are many legal factors like taxation, employment, consumer, advertising, import and
export, health safety policies, compliance as well as regulatory bodies which affect
organizations to expand its business activities in many countries. Corporation also analyses
this factor to take entry in any nation. These things also provide reliability to organization
for managing and operating its business in the various states (Legal factors, 2015). For
example, legal polices of United Kingdom is also attractive than other countries. Taxation
polices are supportive for organizations in the nation. They provide huge chances to save
maximum profit in the UK. These things offers appropriate reliability for many organization
like apple and Sony to conduct their business in the Britain. Regulatory bodies also provide
effective knowledge regarding new rules and regulations. This process is effectively guides
the firms to manage its operations in the nation (Majaro, 2013). On the other side, There are
many policies which are very strict like employment and health and safety polices. They
increase expenditure of national and global organizations in the United Kingdom. Generally,
these rules and regulations also oblige the corporations to follow appropriate increment,
bonus, proper salary, medical insurance, maintaining health as well as safety equipments for
Illustration 1: Legal factors

the security of staff members in the nation.
 Economical- Measurement of Economic factors is essential for any organizations to enter in
the global market. There are many economical imperatives like inflation, taxes and duties,
finance and credit, working practices, exchanges rates, cost of living, GDP (Gross domestic
product) as well as globalisation which affect firms to expand its business in the
international market (Roberts and Dörrenbächer, 2012). So foreign enterprise also analyses
these factors to come in the any nation. These things contribute effective role for firms to
measure operational efficiency in the country. They also help the corporations to develop
new strategies and plan in order to earn optimistic profit after market research in the other
countries (Adam, 2014). For example, Britain is good location as per economy and it is
good for business expansion as comparison of other nations. Many global organizations like
Toyota and other firms are getting effective advantages due to effective economical
conditions of United Kingdom. Generally optimistic working practices, cost of living,
inflation as well as GDP aid the global organizations to perform effective business in the
UK. In addition, these things are providing effective advantages to achieve good income
from consumers in the country. Further, these aspects contribute effective role for
organizations to increase the purchasing power of customers in the United Kingdom. So
consideration of these factors are necessary to come in the another nation for business
expansion.
 Social- These imperatives play important role for global organizations to expand its business
in the other country. Study of social aspect like lifestyle, attitudes and beliefs, social
mobility, ethics and religion, education as well as population growth rate are essential for
corporation to take entry of these country (Cadogan, 2012). These aspects also help the
enterprises to analyse upcoming sales records by getting proper data with them in the nation.
This way, organization can identify its income level in the another nation. Corporation also
determine information these aspects through extensive market research in the nation. This
process aids the firm to design and develop its market strategies for selling its products in
the global countries (Carroll and Buchholtz, 2014). For example, United Kingdom is
optimistic country as per the social factors and it good as compare to another states in the
world. In addition, Many social aspects like life style, education as well as population
growth are effective than other nations in the world. These aspects also attract many global
organizations like Panasonic and Samsung to come for operating business in the United
Kingdom. They are getting better benefits to develop effective strategies and increase
revenues by selling more products in the UK. This way, social aspects also help the

organizations to expand its global business in the many nations.
 Technological- These imperatives are also necessary for companies to expand its business
activities in another countries. There are various technological factors like research and
development, network coverage, production efficiency, quality and pricing, patents and
licences as well as government activities and legislation which impact the corporations to
come in the any nation (Hill, Cronk and Wickramasekera, 2013). So organizations also
analyse technological imperatives with help of market research and online survey in the
nation. This process also gives proper information about these aspects for specific country. It
contributes effective role for firm to establish its business in the nation. For example,
Organizations can also come in the United Kingdom for global business. There are many
technological aspects which are better than other nations. Research and development,
network coverage, quality and pricing are optimistic in the Britain. These factors also aid the
organization to manage and operate its business activities in a appropriate manner within
nation (Foss and Knudsen, 2013). They also provide reliability to take operational decisions
regarding company in the United Kingdom. In addition, they are helping many organizations
like Apple and Microsoft to manage their business transactions in the nation.
 Environmental- Environmental aspects are also important for other corporations for going
international. Further, environment factors like pollution issues as well as Corporate social
responsibilities (CSR) activities. Organizations also determine these aspects to conduct its
business in the nation (Mendenhall and Osland, 2012). Consideration of environmental
issues are necessary because otherwise corporations can not continue its operational and
other activities like production along with manufacturing process in the nation. If
organizations make those types of products which are harmful for the country. So any
Government of nation will not give permission to operate its business (Michailova and
Tienari, 2014). For example, United Kingdom is very strict regarding environment aspects.
Further, climate rules of UK also oblige the all organizations like BMW and other
manufacturing firms to follow these policies regarding environment safety. United Kingdom
fixes percentages ratio for income expenditure as Corporate social responsibility for safety
of climate. So organizations determine these aspects before to come in the any country.
Otherwise, it will be lose of time and monetary funds in the country.
CONCLUSION
From the report, it is found that diversification, increasing brand identity, geographical
expansion, market rate and growth, competency as well as risk help the organizations to expand its
business in the world. In addition, these factors also contribute effective role firms to design

effective strategies for getting better profits in the foreign countries. It can be concluded that
environment imperatives like social, economical, technological, legal, political as well as climate
aspects also help global organizations to select specific nation for operating business in the world.
In addition, these factors also provides proper guidance to manage their operations in the country.

REFERENCES
Journal and books
Adam, H., 2014. Environmentally responsible management in international business: a literature
review. Multinational Business Review. 22(1). pp.78 – 102
Cadogan, J., 2012. International marketing, strategic orientations and business success: Reflections
on the path ahead. International Marketing Review. 29(4). pp.340 – 348
Carroll, A. and Buchholtz, A., 2014. Business and society: Ethics, sustainability, and stakeholder
management. Cengage Learning.
Cavusgil, S.T. and et.al., 2014. International business. Pearson Australia.
Dunning, J.H., 2013. Multinationals, Technology & Competitiveness (RLE International Business).
Routledge.
Enderwick, P., Tung, R. and Chung, H., 2011. Immigrant effects and international business activity:
an overview. Journal of Asia Business Studies. 5(1). pp.6 – 22
Foss, N.J. and Knudsen, C., 2013. Towards a competence theory of the firm. Routledge.
Hill, C.W., Cronk, T. and Wickramasekera, R., 2013. Global business today. McGraw-Hill
Education.
Majaro, S., 2013. International Marketing (RLE International Business): A Strategic Approach to
World Markets. Routledge.
Mendenhall, M.E. and Osland, J., 2012. Global leadership: Research, practice, and development.
Routledge.
Michailova, S. and Tienari, J., 2014. What's happening to international business?: University
structural changes and identification with a discipline. Critical perspectives on international
business. 10(1/2). pp.51 - 64
Peterson, M.F., Arregle, J.L. and Martin, X., 2012. Multilevel models in international business
research. Journal of International Business Studies. 43(5). pp.451-457.
Roberts, J. and Dörrenbächer, C., 2012. The futures of critical perspectives on international
business. Critical perspectives on international business. 8(1). pp.4 – 13
Verbeke, A., 2013. International business strategy. Cambridge University Press.
Wild, J., Wild, K.L. and Han, J.C., 2014. International business. Pearson Education Limited.
Online
Legal factors, 2015. [Online]. Available
Through:<http://www.free-management-ebooks.com/faqst/pestle-07.htm>. [Accessed on 6th
January 2015].
Political Factors. 2015. [Online]. Available Through:
<http://makewealthhistory.org/2007/07/01/political-factors-that-affect-development/>.
[Accessed on 6th January 2015].