Global Business Management

INSTRUCTION: Please add references (Harvard Style) under each TUTORIAL.

TUTORIAL 2

Read: http://www.economist.com/news/finance-and-economics/21652337-economic-dangers-chinas-manic-bull-market-goring-concern

• What impact do economies of scale have on international business dealings?
• In reviewing the economic conditions of trading blocks, how do these organisations affect overall economic growth for the region?  Please explain.

TUTORIAL 3

Read: http://www.sciencedirect.com/science/article/pii/S0261560614001132

• It is argued that unconventional approaches should also be considered in sovereign debt management, in order to contribute to resolving the eurozone sovereign debt crisis. What factors should be considered when moving from a conservative approach to debt to more unconventional solutions? Please explain.
• A government’s debt portfolio is usually the largest financial portfolio in the country. Why is debt such a critical factor to a country's overall stability? Please explain.

TUTORIAL 4

Read: http://www.ijmrbs.com/ijmrbsadmin/upload/IJMRBS_55264e3aa438c.pdf

• As risk is almost part of everything, corporate performance is not an exemption. Even the fortune companies with best management team and financial performance, at various times face disruption either from natural cause or from intense competition, which leads to profit and market share heavy decline. Research an international organisation that has had a recent decline. Please explain the steps and strategic actions it has taken to recover.
• What is the role of resilience in business performance, crisis management and corporate reputation? Please explain.

TUTORIAL 5

Read : Case Study Session Article:

Zarantonello, L., Jedidi K., Schmitt B. Functional and experiential routes to persuasion: An analysis of advertising in emerging versus developed markets. International Journal of Research in Marketing Volume 30, Issue 1, (March 2013) Pages 46–56.

• Review the article and answer the following question: Should advertising be approached differently in emerging than in developed markets? Please explain.
• What are the two routes of persuasion discussed as they relate to emerging and developing markets? Please explain each and provide an example.

TUTORIAL 6

Read: http://www.shrm.org/hrdisciplines/global/articles/pages/global-employee-engagement-rebounds-recession.aspx

• What factors must managers consider in recruitment in global organisations? Please explain.
• Please explain the motivators for a culturally diverse workforce.

TUTORIAL 7

Read: Case Study Session Article: Stehr, C. and Jakob, B., European Journal of Sustainable Development (2014), 3, 4, 135-150.

• Corporate Social Responsibility has grown popular among discussions in economics and societies worldwide. What brought this change in consumer conscientious and organisational awareness of the environment? Please explain.

• In discussing emerging markets, there are responsibilities and expectations placed upon organisations entering a new or emerging market. What are some of these? How do they apply to a global business?
• What is the 'Heilbronn Declaration'? How can this declaration be utilised as an example for other countries to implement?

TUTORIAL 8

Read: Mari, S., Lee Y., Memon, M. Complex network theory-based approach for designing resilient supply chain networks. Int. J. of Logistics Systems and Management  (2015) Vol.21, No.3 pp.365 – 3

• Facts: Your diamond supplier is in South Africa. You get your gold from a supplier in China. The jewelry itself is assembled in Switzerland. Your job is to manage the supply chain from acquisition of a resource through its transformation into a finished product and until it is sold to a customer. In light of the fact scenario, what factors must you consider in your supply chain to accomplish the most cost effective transport of the supplies to final product sale? Please explain.

• What are the three main types of logistics channels in international supply chain? Please explain each.

Read: http://www.economist.com/news/finance-and-economics/21652337-economic-dangers-chinas-manic-bull-market-goring-concern

• What impact do economies of scale have on international business dealings?
• In reviewing the economic conditions of trading blocks, how do these organizations affect overall economic growth for the region?  Please explain.

Answer

1. With Economies of scale more units of goods or services can be produced on a larger scale with a lesser average cost. Companies produce similar products and trade it globally (Economies Of Scale, n.d.). For example, many USA and German companies compete in automobile markets. With economies of scale (EOS), with larger volumes, the average cost per unit will come down. Lower costs will further increase demand and hence scale will further increase It can result in productive efficiency and benefits to all trading countries. The exporting country will get access to bigger markets and will be able to cut down average production cost. Importing countries can get the same things now at relatively cheaper prices. It creates more opportunities for big players and difficulties for small players.
2. In the article ((SHANGHAI, 2015) author explained that in short term market value of companies will increase multifold because of trading blocks, falling share prices even when the economy has slowed down in reality. In the long term, it is like a bubble and is bound to take a corrective course of action. After stock price crash, banks who have lent to wealthy investors without investigating balance sheets will be at high risk. Investors are bound to lose their money and trust forever. 

References: 

Economies Of Scale. (n.d.). Retrieved from http://www.investopedia.com/.

SHANGHAI. (2015, May 30). China's stockmarket bubble A goring concern. Retrieved from http://www.economist.com/: http://www.economist.com/news/finance-and-economics/21652337-economic-dangers-chinas-manic-bull-market-goring-concern

TUTORIAL 3

Read: http://www.sciencedirect.com/science/article/pii/S0261560614001132

• It is argued that unconventional approaches should also be considered in sovereign debt management, in order to contribute to resolving the Eurozone sovereign debt crisis. What factors should be considered when moving from a conservative approach to debt to more unconventional solutions? Please explain.
• A government debt portfolio is usually the largest financial portfolio in the country. Why is debt such a critical factor to a country's overall stability? Please explain.

Answer

1. In the article (Enhanced Debt Management by Richard A Werner 2014), below factors has been suggested to be considered while moving from unconventional solutions, in order to contribute to resolving Eurozone sovereign debt crisis:
   1. Sovereign bond market, debt management policy and fiscal policy are interlinked. Basel I regulations attach a zero risk weighting to government bonds issued by OECD members, and require no capital for banks to purchase such bonds. Basel II encourages risk management policies resulting in a reduction of capital cover of large banks
   2. Rating behaviour of Credit rating agencies
   3. International accounting standards, based on market to market traded securities 
   4. Dependence of the price of government bond prices affecting banks
   5.  Increased securitisation  for market to market traded securities
   6. The design of the banking system with a miniscule capital base, i.e. on reduction of values in bank assets whole banking system may go insolvent
   7. High degree of interbank cooperation required for continued solvency 
   8. Dependency of finance ministers and debt officers on technical advice from bond underwriters who are incentivized to favour the issuance of trade instruments in public debt management (Enhanced Debt Management by Richard A Werner 2014).
   9. Different policy makers working without coordination.

1. Government's debt portfolio is a very important factor to measure country's overall stability. It is composed of complex & risky financial structures that can generate a risk to the government's balance sheet and overall financial stability of the country (Banerjee, Abhijit 1992). A badly structured debt is it in terms of maturity, currency or interest rate composition or large and unfunded contingent liabilities are very important factor in inducing and propagating economic crisis. Government's own portfolio management have a direct and big impact on the private sector make it less susceptible to contagion and financial risk.

References: 

Banerjee, Abhijit 1992. A simple model of herd behavior Q.J. Econ 107 (3), 797-817Werner, R. A. (2014, December). Enhanced Debt Management: Solving the eurozone crisis by linking debt management with fiscal and monetary policy. Journal of International Money and Finance, 443–469. Retrieved from http://www.sciencedirect.com/science/article/pii/S0261560614001132