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Profile. Name: Dr. Abubakr Saeed Education 2011-Feb 2013 PhD in Corporate Governance Middlesex University, London, UK  2010-2011 MPhil in Corporate Governance Brunel University, Uxbridge, UK 2006-2008 Master of Business Administration

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Profile

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  1. Profile Name: Dr. Abubakr Saeed Education 2011-Feb 2013 PhD in Corporate Governance Middlesex University, London, UK  2010-2011 MPhil in Corporate Governance Brunel University, Uxbridge, UK 2006-2008 Master of Business Administration Blekinge Tekniska Högskola, Karlskrona, Sweden 2006-2008 Master of Science (Computer Science) Umeå University, Umeå, Sweden 1999-2002 BCS (Hons) (Computer Science) International Islamic University, Islamabad, Pakistan

  2. Experience: June 2014- Assistant Professor COMSATS IIT, Islamabad, Pakistan April 2013- May 2014 Assistant Professor Foundation University, Islamabad, Pakistan Sept 2008-Feb 2013 London Churchill College Administration, London, UK (Lecturer) Mar 2008- Aug 08 Research Assistant Aalen University, School of Management & Business Sciences, Aalen, Germany

  3. Taught Courses: Research Methodology CSR Business Policy International Business Business Environment Corporate Governance

  4. Global Business Management (MGT380)

  5. Course Outline

  6. LECTURE 01

  7. Introduction Objectives • Understand what is meant by the “globalization” • How global business is different from domestic business • Be familiar with the main drivers/causes of globalization • Understand the various stages of globalization

  8. What is global business? “Any business activity that is carried out across the national boarders is termed as global business activity.” • Extent of global business activity can vary

  9. Why we study global business management • When a firm move to a new market across the boarder it interacts with new customers, market segments, competitors, regulators, etc. So, that firm need to know the demographics, language, geography, economics of the new markets. • Global business management enables managers to understand economics, anthropology, statistics, geography and demographics of the countries.

  10. Can a firm stay isolated • Power of globalization • A company fails to go abroad is in the danger of losing its domestic business to competitors with lower costs, or better quality.

  11. How Has Foreign Direct Investment Changed Over Time?

  12. How Has Foreign Direct Investment Changed Over Time?

  13. Differentiating features of GB • Political and legal differences • Culture differences • Economic differences • Differences in currency • Trade restrictions • Higher cost of distance

  14. Why firm become global • Push factors: • Reactive reasons. • E.g., saturation of market • Pull factors: • Pro-active reasons • E.g., Profitability, growth

  15. 1) Profit Advantage • Most important • Global business is usually more profitable • Most important way to increase the profit is by reducing the cost • E.g. MNCs move to developing countries • For example: Philips has 23 factories in China, Their 2/3 of $15 billion of goods produced in China, in 2001 20% of total production of Philips came form China.

  16. 2) Growth Opportunities • 3) Domestic market constraints • When market potential of any product is fully tapped • Optimum sale of production e.g., Nestle earns 2% from Switzerland, Philips 8% from Holland. • Domestic recession can provoke internationalization, e.g., Hindustan Machine Tools Ltd expended globally in 2001

  17. 4) Competition • A protected market is not a driver for globalization • Counter-competition strategy, it is a strategy in which a company penetrate the home market of the foreign entrant so that it looses the competitive strength and protect the domestic market. • IBM- Fujitsu and Hitachi; Taxes Instrument entered in Japan; GE entered in Germany (AEG) and Japan (Hitachi)

  18. 5) Government Policies • Can be positive and negative • Sometimes Policies limit the scope of business • e.g., Birla

  19. Mini-case study: Procter & Gamble in Japan • P&G enter the Japanese market in 1972, was the first one to introduce disposable diapers in Japan, gained 80% of market share. • Lost its share to 8%, shifted their focused on laundry detergents, and personal care product but failed and lost $40 million/year. • Marketing strategy: In TV advertisement they showed a women relaxing in a bath of soap bubbles, while her husband walked in and asked her about the soap. The same advertisement produced the significant results in Europe and US but not in Japan.

  20. Contd… • Case discussion questions: • Why a successful advertisement in one market failed in another market • What was the central problem with the management’s approach (Hint: see differences in international orientation)

  21. Quick Recap • What is globalization • What are the differentiating feature of GB • What are the Forces of GB • 4-types of International orientations • Stages of global business • How firms make decision to internationalize

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