Sustainable Change Of Technology & International Business
Preface
Smart technology becomes a fundamental instrument for businesses, education and individuals worldwide to enhance job performance and productivity and to ensure the job is efficient and effective. Additionally, smart technology can improve communication, collaboration, cooperation, connection, job efficiency and proficiency between employees vs. employers, employees vs. stakeholders, students vs. students, and students vs. teachers locally and globally. Using smart technology can improve data management, support availability of Internet mobility, stimulate creativity and innovation, encourage factor of globalization phenomena, enhance customers’ and students’ satisfaction via communication, collaboration, cooperation and connection. Furthermore, using smart technology can reduce utility cost; more sustainable and saving energy among businesses, education and individuals.
The field of international business made its entry into the academic stage in the 1960s with the emergence of a new business entity—the multinational enterprise (MNE)—which posed new questions regarding the internationalization of firms for research scholars.1 Why did firms run the risks of internationalizing? What were the sources of competitive advantage for MNEs over their domestic rivals? Were there distinctive patterns in the way that firms internationalized, and did these differ according to the national origins of MNEs? These were some of the “big questions” that launched and sustained the field of international business studies during its first few decades.
Overview of Technology & International Business
Political, economic, and environmental issues are increasingly becoming the remit of international business leaders as much as governments.our aim is to prepare our students to become the next generation of global business leaders, embracing the opportunities and challenges of international business. While the global marketplace becomes more interconnected and accessible, the risks involved in doing business abroad are not to be taken lightly.
Expanding business overseas means reaching new clients or customers and potentially boosting profits. Despite all the uncertainty of 2017 and the challenges that have yet to reveal themselves, there are some guidelines for conducting business on a global scale that you should always consider before leaping into new international operations.
Here is our advice on how to tackle the 11 biggest challenges for international business:
ü International company structure
ü Foreign laws and regulations
ü Cost calculation and global pricing strategy
ü Universal payment methods
ü Currency rates
ü Choosing the right global shipment methods
ü Communication difficulties and cultural differences
ü Supply chain complexity and risks of labor exploitation
ü Worldwide environmental issues
1.International company structure:
Competitive globally, you must have a team in place that’s up for the challenge. One fundamental consideration is the structure of your organization and the location of your teams.
For instance, will your company be run from one central headquarters? Or will you have offices and representatives “on the ground” in key markets abroad? If so, how will these teams be organized, what autonomy will they have, and how will they coordinate working across time zones? If not, will you consider hiring local market experts who understand the culture of your target markets, but will work centrally?
Coca-Cola offers one example of an effective multinational business structure. The company is organized into continental groups, each overseen by a President. The central Presidents manage Presidents of smaller, country-based or regional subdivisions. Despite its diverse global presence, the Coca-Cola brand and product is controlled centrally and consistent around the world.
While Coca-Cola is a vast international brand, the structure of your business and the number, nationality, and level of expertise of your team will vary depending on your industry, product, and the size of your business.
2. Foreign laws and regulations
Along with getting your company structure in place, gaining a comprehensive understanding of the local laws and regulations governing your target markets is key. From tax implications through to trading laws, navigating legal requirements is a central function for any successful international business. Eligibility to trade is a significant consideration, as are potential tariffs and the legal costs associated with entering new markets.
It’s important to note that employment and labor requirements also differ by country. For instance, European countries stipulate that a minimum of 14-weeks maternity leave be offered to employees, while on the other hand, there is no such requirement for U.S. employers. With the complexity involved in foreign trade and employment laws, investing in knowledgeable and experienced corporate counsel can prove invaluable.
Beyond abiding by official laws, engaging in international business often requires following other unwritten cultural guidelines. This can prove especially challenging in emerging markets with ill-defined regulations or potential corruption. In response, companies doing business in the United States must abide by the Foreign Corrupt Practices Act, which aims at eliminating bribery and unethical practices in international business. A good rule of thumb is to beware of engaging in any questionable activities, which might be legal but could have future reputational repercussions.
3. International accounting
Of the main legal areas to consider when it comes to doing international business, tax compliance is perhaps the most crucial. Accounting can present a challenge to multinational businesses who may be liable for corporation tax abroad. Different tax systems, rates, and compliance requirements can make the accounting function of a multinational organization significantly challenging.
Accounting strategy is key to maximizing revenue, and the location where your business is registered can impact your tax liability. Mitigating the risk of multiple layers of taxation makes good business sense for any organization trading abroad. Being aware of tax treaties between countries where your business is trading will help to ensure you’re not paying double taxes unnecessarily.
4. Cost calculation and global pricing strategy
Setting the price for your products and services can present challenges when doing business overseas and should be another major consideration of your strategy. You must consider costs to remain competitive, while still ensuring profit. Researching the prices of direct, local-market competitors can give you a benchmark, however, it remains essential to ensure the math still works in your favor. For instance, the cost of production and shipping, labor, marketing, and distribution, as well as your margin, must be a taken into account for your business to be viable.
Pricing can also come down to how you choose to position your brand — should the cost of your product reflect luxury status? Or will low prices help you to penetrate a new market? Swedish furniture giant Ikea, known in Europe for its low-cost value, struggled initially in China due to local competitor costs of labor and production being much cheaper. By relocating production for the Chinese market and using more locally sourced materials, the company was able to successfully cut prices to better reflect its brand and boost sales among target consumers.
5.Universal payment methods
The proliferation of international e-commerce websites has made selling goods overseas easier and more affordable for businesses and consumers. However, payment methods that are commonly accepted in your home market might be unavailable abroad. Determining acceptable payment methods and ensuring secure processing must be a central consideration for businesses who seeks to trade internationally.
Accepting well-known global payment methods through companies like World pay, as well as accepting local payment methods, such as JCB in Asia or Yandex Money in Russia, can be a good option for large international businesses. Accepting wire transfers, PayPal payments, and Bit coin, are other possibilities, with Bitcoin users benefiting from no bank or credit card transaction fees. Despite the risk of fluctuating value, the lack of fees is one of the reasons a number of online companies, including WordPress, the Apple App Store, Expedia, and a number of Etsy sellers accept Bitcoin.
6.Currency rates
While price setting and payment methods are major considerations, currency rate fluctuation is one of the most challenging international business problems to navigate. Monitoring exchange rates must therefore be a central part of the strategy for all international businesses. However, global economic volatility can make forecasting profit especially difficult, particularly when rates fluctuate at unpredictable levels.
Major fluctuations can seriously impact the balance of business expenses and profit. For instance, if your company is paying suppliers and production costs in U.S. dollars, but selling in markets with a weaker or more unpredictable currency, your company could end up with a much smaller margin — or even a loss. One way to protect yourself against large fluctuations in currency is to pay suppliers and production costs in the same currency as the one you’re selling in. This may mean switching to more local production where possible in order to better balance your outgoings and sales revenue.
7. Choosing the right global shipment methods
The potential of online sales presents a huge international business opportunity for retailers in the 21st century, but finding reliable, fast, and cost-effective shipment and distribution methods can be a difficult balance in some markets. Depending on the volume and destination of your shipments, will you send by land, sea, air, or a combination? Your choice of shipping method can be a major influence on your revenue and may be a limiting factor to the products you can viably sell overseas.
Other considerations to address according to your company’s products and your target markets include customs fees, the need and cost of storage, and local methods of distribution. There are also country-specific regulations and shipping requirements to take into account. For a quick check of costs and compliance, UPS International has created an online tool called TradeAbility to help businesses and individuals manage the movement of good overseas.
8. Communication difficulties and cultural differences
Good communication is at the heart of effective international business strategy. However, communicating across cultures can be a very real challenge. Developing cross-cultural competency and communication skills are a core focus inside and outside of the classroom.
Effective communication with colleagues, clients, and customers abroad is essential for success in international business. And it’s often more than just a language barrier you need to think about — nonverbal communication can make or break business deals too. Do your research and know how different cultural values and norms — such as shaking hands — can and should influence the way you communicate in a professional context. Being aware of acceptable business etiquette abroad, and how things like religious and cultural traditions can influence this, will help you to better navigate potential communication problems in international business.
9. Political risks
An obvious risk for international business is political uncertainty and instability. Countries and emerging markets that may offer considerable opportunities for expanding global businesses may also pose challenges, which more established markets do not. Before considering expansion into a new or unknown market, a risk assessment of the economic and political landscape is critical.
Issues such as ill-defined or unstable policies and corrupt practices can be hugely problematic in emerging markets. Changes in governments can bring changes in policy, regulations, and interest rates that can prove damaging to foreign business and investment.
A growing trend towards economic nationalism also makes the current global political landscape potentially hostile towards international businesses. For instance, companies like Facebook are banned in China, partially in preference for national social networks and also due to government regulation over internet content. Monitoring political developments and planning accordingly can mitigate political risks of doing business abroad.
10. Supply chain complexity and risks of labor exploitation
When it comes to sourcing products and services from overseas, managing suppliers and supply chains can also be a tricky process. Unfortunately, the length and complexity of supply chains increases the chance of working with suppliers who have unethical — and even illegal — business practices. Of growing concern is the risk in international business of forced labor and worker exploitation.
In October 2015, the UK passed the Modern Slavery Act in response to this often-hidden human rights violation. Recent research led by a partnership between International Business School and the Ethical Trading Initiative revealed that an astonishing 77% of businesses believe that modern slavery exists at some point in their supply chains.
To raise awareness and help local and international businesses respond more effectively to this issue, their published research report presents case studies of businesses who have implemented practices at the leading edge of the fight against modern slavery.
11. Worldwide environmental issues
As the environmental risks and effects of climate change are becoming better understood, sustainability is high on the agenda of many major global corporations. Recent international legislations and proposals, such as the UN’s Sustainable Development Goals, have put environmental issues at the forefront of international business development. The Ashbridge Centre for Business and Sustainability researches innovative ways that organizations can develop and implement more environmentally sustainable business models.
On a practical level, if you’re considering expanding your business overseas, it’s important to be aware of the country-specific environmental regulations and issues associated with your industry. Some key considerations include how your production methods might impact the local environment through waste and pollution.
Beyond a legal or ethical incentive to be more eco-friendly, establishing environmentally conscious business practices can attract new, forward-thinking consumers to your company. With a number of brands such as Dell, Renault, and MUD Jeans leading a shift towards the circular economy, there is an opportunity and demand for changing production methods and consumer behavior to establish a more sustainable future for the environment and society as a whole.
The Role of Technology in International Business
Technology in business is a growing necessity. As the years go by, the business world is leaning more and more toward it, making it almost impossible to separate the two from each other. Innovation breeds business, and since technology paves the way for it, it can be gathered here that business needs technology to be sustained.
The business has always existed since the early times of man. Even though it only began with the simplistic barter system, a business would not be the same as it is today without the advancements in technology. All the major industries would fall into a catastrophic collapse if one were to take away technology from the business since the majority of business operations and transactions somehow involve the use of technology.
1. Technology as an International Business Necessity
The role of technology in business caused tremendous growth in trade and commerce. Business concepts and models were revolutionized as a result of the introduction of technology. This is because technology gave a new and better approach on how to go about with business. It provided a faster, more convenient, and more efficient way of performing business transactions.
Some of the actions of technology in business include accounting systems, management information systems, point of sales systems, and other simpler or more complicated tools. Even the calculator is a product of technology. It is indeed unfathomable to summon the idea of going back to the days where everything was done manually, which basically means starting all over again from scratch.
2. Security and Support
With the automated processes that technology can provide, productivity reaches a higher level. This is due to the minimal resources consumed in processing business activities, allowing room for better products produced and faster services delivered to more clients and customers.
Information is also stored with ease and integrity. With this, confidential and sensitive information are less prone to vulnerabilities. The said information can also be instantly retrieved and analyzed to monitor trends and make forecasts, which can be crucial in decision-making processes.
3. A Link to the World
Business involves communication, transportation, and more fields, making it a complex web of processes. The technologies pertaining to other fields only pushed business further. Globalization has been realized because of the wonders of technology. Anyone can now do business anywhere within being constricted to the four corners of his room.
Technology in business made it possible to have a wider reach in the global market. The basic example is the Internet, which is now a common marketing tool to attract more consumers in availing products and services offered by various businesses.
Which technology is facilitating International Business are as follows:
Technology is beneficial to international business. It may be stated that lowering of trade barriers has made globalization of markets and production a theoretical possibility, technology has made it a practical reality.
1. Telecommunications
2. Transportation
3. Globalization of Production
4. Globalization of Markets
5. E-Commerce
6. Technology Transfer
1. Telecommunications:
This is the most obvious dimension of the technological environment facing international business. Now people are using cellular phones, beepers and other telecommunications service, giving away to international growth.
As a result, growth in the wireless technology business worldwide has been rapid and the future promises even more. This growth is welcome as a business, domestic or global, cannot prosper without an efficient telephone system. Technologies such as 3G, MMS of NOKIA have fostered closely knit global business.
2. Transportation:
Technology In addition to developments in computers and telecommunications, several major innovations in transportation have occurred since World War II. In economic terms, the most important is probably the development of commercial jet aircraft and super freighters and the introduction of containerization, which simplifies transshipment from one mode of transport to another.
While the advent of the commercial jet has reduced the travel time of businessmen, containerization has lowered the costs of shipping goods over long distances.
3. Globalization of Production:
Technological breakthroughs have facilitated the globalization of production. A worldwide communications network has become essential for any MNC. Texas Instruments (TI), the US electronics firm, For example,
has nearly 50 plants in 19 countries. A satellite-based communications system allows TI to coordinate on a global scale; its production planning, cost accounting, financial planning, marketing, customer service, and human resource
4.Globalization of Markets:
Along with the globalization of production, technological innovations have facilitated the inter-nationalization of markets. As stated earlier, containerization has made it more economical to transport goods over long distances, thereby creating global markets.
Low-cost global communications networks such as the World Wide Web are helping to create electronic global market places. In addition, low-cost jet travel has resulted in the mass movement of people around the world. This has reduced the cultural distance between the countries and is bringing about convergence of consumer tastes and preferences. At the same time, global communications networks and global media are creating a worldwide culture. Worldwide culture is creating a world market for consumer goods. Signs of a global market are already visible. It is now easy to find, a McDonald’s restaurant in Tokyo as it is in New York, to buy a Sony Walkman in Mumbai as it is in Berlin and to buy Lewis’s jeans in Paris as it is in San Francisco.
5.E-Commerce:
The Internet and the access gained to the World Wide Web have revolutionized international marketing practices. Firms ranging from a few employees to large multinationals have realized the potential of marketing globally online and so have developed the facility to buy and sell their products and services online to the world.
Because of the low entry costs of the Internet, it has permitted firms with low capital resources to become global marketers, in some cases overnight. There are, therefore, quite significant implications for SMEs. For all companies, the implications of being able to market goods and services online have been far-reaching.
In B2C marketing this has been most dramatically seen in the purchase of such things as flights, holidays, CDs and books. The Internet, by the connecting end- users and producers directly, has reduced the importance of traditional intermediaries in international marketing (i.e., agents and distributors) as more companies have built the online capability to deal directly with their customers, particularly in B2B marketing.
6.Technology Transfer:
Technology transfer is a process that permits the flow of technology from a source to a receiver. The source, in this case, is the owner or holder of the knowledge, while the recipient is the beneficiary of such knowledge. The source could be an individual, a company, or a country.
Modern Technology
In the past 50 years, electronics revolutionized business and society. There is a never-ending demand to make electronic goods smaller, faster, cheaper, and more powerful. Computers can store thousands of files electronically, saving time and office space.
Business Culture and Class Relations
Technology creates a team dynamic within a business because employees at different locations have better interactions. If factory managers can communicate with shipment coordinators at a different location, tensions and distrust are less likely to evolve. Cliques and social tensions can become a nightmare for a business; technology often helps workers put their different backgrounds aside.
Security
Most businesses in the modern era are subject to security threats and vandalism. Technology can be used to protect financial data, confidential executive decisions and other proprietary information that leads to competitive advantages. Simply put, technology helps businesses keep their ideas away from their competition. By having computers with passwords, a business can ensure none of its forthcoming projects will be copied by the competition.
Research Capacity
A business that has the technological capacity to research new opportunities will stay a step ahead of its competition. For a business to survive, it must grow and acquire new opportunities. The Internet allows a business to virtually travel into new markets without the cost of an executive jet or the risks of creating a factory abroad.
Plan to improve your business in the year ahead; you should look at some key technologies that can help you manage your customers, your data and your products.
1. Customer Relationship Management software
2. Cloud computing
3. Logistics tracking technology
4. Translation and language learning software and services
1. Customer Relationship Management software
Every business thrives on healthy customer service and customer relationships. When you’re dealing with clients across the globe, especially as you expand, it can be difficult to keep track of all of your contacts. That’s where Customer Relationship Management (CRM) software can help.
CRM software enables you to create a database of all of your contacts that can be accessed by any applicable members of your team.
With CRM software, you can store a complete record of all of your company’s interactions with clients or potential clients. You can set up your database to capture each individual’s order history, concerns, business, and personal information, and all points of contact they have had with members of your team, including phone calls, emails and chats.
CRM software is especially helpful when dealing with businesses on an international scale. It will help you and your team track where customers are located along with the languages they speak, local customs that you and your team need to be aware of and any applicable trade rules or restrictions.
CRM software can help you serve customers better by staying on top of their needs, concerns, and preferences. It can also help your team to operate more efficiently, cutting down on time spent searching for information, emails or files related to their customers.
2. Cloud computing
At this point, most people have heard of cloud technology, and nearly everyone who uses a computer, tablet or Smartphone has used “the cloud” in some way. While technology has become ubiquitous, you might not be aware of how cloud technology can improve your business’s operations.
When using cloud technology, your company’s digital operations take place on off-site servers that can be accessed from anywhere.
This can be particularly beneficial to companies operating on a global scale whose employees travel frequently or work remotely.
By using cloud technology, an employee on the go can access files and software utilized by the company back at headquarters from anywhere. It also means that any traveling employees can remain connected to staff back at the home office, whether it’s filing reports, sharing data or communicating seamlessly across international borders.
3. Logistics tracking technology
For companies that buy or sell internationally, logistics can be the most troublesome part of doing business. Executing, receiving and tracking shipments requires a lot of careful consideration and planning, and shipments that go awry can cost time, money and customers.
To help organizations tackle these tasks more efficiently, innovative new technology is becoming available. Logistics management systems can help bear the brunt of the burden of international shipping. They can help plan trade routes, monitor any trade restrictions or problem areas, and track shipments.
Logistics tracking technology can also be a major help in reworking disrupted routes to get your deliveries back on track.
Electronic shipment tracking is also evolving quickly to help meet businesses’ needs. Once cost prohibitive, radio frequency identification (RFID) devices have become more affordable and attainable for companies to implement. As the technology becomes more accessible, Bluetooth beacons provide another option for electronically tracking shipments.
As both RFID and Bluetooth beacons become more commonplace, businesses will be able to take advantage of automatic identification and data capture (AIDC) in their supply chains, making it easier and more efficient to track and manage their goods.
4. Translation and language learning software and services
Language barriers can be a major challenge for global companies. It goes without saying that it’s crucial to be able to communicate effectively with customers, leads and business partners.
Web-based translation companies are improving their functions every day. They are sophisticated enough to translate and check your communications, at least for a first draft. While this technology has made great strides in recent years, it’s still advisable to have a fluent speaker or professional translator check your work to avoid any inaccuracies.
If you plan to do business with partners or customers in a region for an extended period of time, learning the language can save you money on translation costs, and it can help you provide better customer service.
To that end, there are plenty of reputable online programs and software that can help you become fluent in a foreign language.
As you plan to upgrade your business in 2017, don’t forget to explore all of the ways technology can help you grow, whether it’s by providing better customer service, keeping your employees connected, improving your logistics or helping you communicate with your customers.
Bibliography
- Books:-
ü International Business Strategy and Entrepreneurship: An Information Technology Perspective (Advances in Business Strategy and Competitive Advantage) Hardcover – Import, 30 Jan 2014
ü The Soul of a New Machine by Tracy Kidder (2017)
ü Irresistible: The Rise of Addictive Technology and the Business of Keeping Us Hooked Book by Adam Alter
· Websites: -
ü https://www.yourarticlelibrary.com/technology
ü https://bizfluent.com/information-technology&international-business.html