Business Environment Module 2

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Business Environment Module 2Business EnvironmentModule 2Eldo Geevarghese Zacharia KayyalathAsst. Professor/ Placement OfficerLEAD College of ManagementPalakkad, Kerala9/27/20131LEAD COLLEGE OF MANAGEMENT, PALAKKAD19/27/2013LEAD COLLEGE OF MANAGEMENT, PALAKKAD, KERALAELDO GEEVARGHESE ZACHARIA KAYYALATHBirds Eye ReviewGlobalization StrategiesWorld Trade Organization implicationsPublic Sector in India- role in economic devpPrivatizationIntellectual Property Rights (IPR) and related issues.9/27/20132LEAD COLLEGE OF MANAGEMENT, PALAKKADELDO GEEVARGHESE ZACHARIA KAYYALATH9/27/2013LEAD COLLEGE OF MANAGEMENT, PALAKKAD, KERALA2Globalization Interdependence among countriesCross border transactionsGoodsServicesCapital flowsTechnologiesPeopleKnowledge 9/27/2013LEAD COLLEGE OF MANAGEMENT, PALAKKAD3Globalization IMF Defines:The growing interdependence of countries worldwide through increasing volume and variety of cross border transactions in goods and services and of international capital flows and also through the more rapid and widespread diffusion of technologies 9/27/20134LEAD COLLEGE OF MANAGEMENT, PALAKKAD.or elseIt is the closer integration. of the countries and the people of the world ...brought about by the enormous reduction of costs of transportation and communication.., and the breaking down of artificial barriers to the flows of the following across bordersGoodsServicesCapitalKnowledgepeople9/27/2013LEAD COLLEGE OF MANAGEMENT, PALAKKAD5First Echelon1. Buzz FrEedOm:Import / x-potsourcing finance and other factors from abroadFree flow of investments What do you MEAN?We WANT Economic Liberalization first to achieve the so called globelization 9/27/2013LEAD COLLEGE OF MANAGEMENT, PALAKKAD6Govt. should lift restrictions 2. Facilities Where is the facilities?9/27/2013LEAD COLLEGE OF MANAGEMENT, PALAKKAD7Oh I seeee9/27/2013LEAD COLLEGE OF MANAGEMENT, PALAKKAD83. Resource:s Fin-A-nceTech-o-logy R & D Man-A-gerial e-X-perti-s-eBRA-nd I-mageH ResourseNote the point: Small firms do excel with their unique advantages.9/27/2013LEAD COLLEGE OF MANAGEMENT, PALAKKAD94. Competitiveness:Low costProduct qulityProduct differentitionTechnologicl superiorityFter sles servisesMrketing strtegies9/27/201310Foreign Market Entry StrategiesExportingLicensing/FranchisingContract ManufacturingAssembly operationsFully owned manufacturing facilitiesJVM&AStrategic allianceThird country location9/27/2013LEAD COLLEGE OF MANAGEMENT, PALAKKAD11ExportingTraditional modeGood when:Volume of foreign buzz is not large enough to justify the production in a foreign destinationCost of production in a foreign destination is highRisks involved in investments in a foreign destination9/27/2013LEAD COLLEGE OF MANAGEMENT, PALAKKAD12Licensing and franchising:Firm in one country (licensor) permits a firm in another country (licensee) to use its IPRPatents Trade marksCopyrightsTechnologyTechnical know howMarketing or any other skillsMonetary benefits is in the form of royalty/fees etc..In many countries, it is regulated by the various governments (say 5% of sales) 9/27/2013LEAD COLLEGE OF MANAGEMENT, PALAKKAD13Contract Manufacturing:Firms doing international marketing contracts with firms in foreign countries to manufacture or assemble the products while retaining the responsibility of marketing the product. 9/27/2013LEAD COLLEGE OF MANAGEMENT, PALAKKAD14.for Eg9/27/2013LEAD COLLEGE OF MANAGEMENT, PALAKKAD15.wow.advsNo setting up of production unitsIf ideal production facilities are avail ABLE its easy for the marketer to get startedLow cost high profitNo risk in investing in foreign companies9/27/2013LEAD COLLEGE OF MANAGEMENT, PALAKKAD16Assembly OperationsIdeal when there are economies of scale in the manufacturing of parts and components labour intensive labour is cheap in foreign market Low import duties on import of parts 9/27/2013LEAD COLLEGE OF MANAGEMENT, PALAKKAD17Joint Ventures Sharing of ownership and management in an enterprise9/27/2013LEAD COLLEGE OF MANAGEMENT, PALAKKAD18Favoring GlobeHRWide baseGrowing domestic marketTran nationalization of world economiesEconomic liberalizationCompetition 9/27/2013LEAD COLLEGE OF MANAGEMENT, PALAKKAD19Obstacles to GlobalizationGovt policies and proceduresHigh costPoor infrastructureObsolescenceResistance to changePoor quality imageSupply problemLimited R & DLack of Growing competition9/27/2013LEAD COLLEGE OF MANAGEMENT, PALAKKAD20Public Sector in India- role in economic devpRailwaysPostal ServicesTelecom ServicesPower Sector Public transportation ServicesEducational InstitutionsBanking SectorOil and Gas SectorAgricultural SectorTourism SectorAir Transportation9/27/2013LEAD COLLEGE OF MANAGEMENT, PALAKKAD21Privatization9/27/2013LEAD COLLEGE OF MANAGEMENT, PALAKKAD22What should the govt do?Public SafetyDefenseJusticeProtect public health/environmentEducationEnsure democracyOther?9/27/2013LEAD COLLEGE OF MANAGEMENT, PALAKKAD23Dont Panic9/27/2013LEAD COLLEGE OF MANAGEMENT, PALAKKAD24X-pl-nation Transfer of ownership and/or management of an enterprise from the public sector to private sector.Opening up.. of the industries (only and not any other things) that has been reserved for public to the private sector.sAle of govt -ASS-ets 9/27/2013LEAD COLLEGE OF MANAGEMENT, PALAKKAD25y?Rise of the new rightDominance of economiesInternational trends & organisationsFinancial crisisChallenges to role, size & scope of public sector9/27/2013LEAD COLLEGE OF MANAGEMENT, PALAKKAD26How govt interest is hand-ledRegulatory regime: new or enhanced Government dividend/ taxes..Government role in governance AppointmentsRepresentation on board etc9/27/2013LEAD COLLEGE OF MANAGEMENT, PALAKKAD27Sweets of pvt-i-zation the fiscal burden of the stateEnable the govt to mop up fundsHelps state to trim the size of A-dm-strat-ve mAc-eryConcentrate more on essential state functionsBtr mgmt of enter-prize9/27/2013LEAD COLLEGE OF MANAGEMENT, PALAKKAD28Black mark!!!Think pls.9/27/2013LEAD COLLEGE OF MANAGEMENT, PALAKKAD29HmmCertain noble objectives of public sector will be hammeredConcentration of economic powers to few handsAcquisition of national firms by foreign firmsForegoing future streams of profit for the govtVested interest behind privatization 9/27/2013LEAD COLLEGE OF MANAGEMENT, PALAKKAD30WTOWTO was formed on 1st Jan,1995.It took over GATT (General agreement on tariffs & trade) in 8th round of GATT, popularly known as Uruguay Roundmember nations of GATT decided to set up a new organization, World Trade Organization in place of GATT.9/27/2013LEAD COLLEGE OF MANAGEMENT, PALAKKAD31WTF enjoys identical legal status , privileges , Immunities that the world bank & IMF get9/27/2013LEAD COLLEGE OF MANAGEMENT, PALAKKAD32The WTO was born out of theGeneral Agreement on Tariffs and Trade (GATT).Headquarters:Geneva, SwitzerlandFormation:1 January 1995Membership:153 member countriesBudget:163 million USD (Approx).9/27/2013LEAD COLLEGE OF MANAGEMENT, PALAKKAD339/27/2013LEAD COLLEGE OF MANAGEMENT, PALAKKAD34GATTIt was ad hoc & provisional.It had no provision for creating an organization. It allowed contradictions in local law & GATT agreements.WTOIt is permanent.It has legal basis because member nations have verified the WTO agreements.It doesn't allow any contradictions in local law.WTO Vs GATTWTO has more authority than GATTO-b-ject-ivesTo implement the new world trade agreement.To promote multilateral trade .To promote free trade by abolishing tariff & non-tariff barriers.To enhance competitiveness among all trading partners so as to benefit consumers.9/27/2013LEAD COLLEGE OF MANAGEMENT, PALAKKAD35To increase the level of production & productivity with a view to increase the level of employment in the world.To expand & utilise world resources in the most optimum manner.To improve the level of living for the global population & speed up economic development of the member nations.To take special steps for the development of poorest nations9/27/2013LEAD COLLEGE OF MANAGEMENT, PALAKKAD36

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