Posted: November 27th, 2013

International Business Questions







International Business Questions

Question 1


Define culture from an international perspective.

Culture is a system defined as the way man interacts and behaves in relation to the environment. It can be related to a nation’s culture, a distinct part of a society or a certain organization. Culture includes all things that people learn that involves beliefs, norms, customs and traditions.

Is national culture important for companies going international? Why?

National culture is important for companies going international because of multiple reasons. For instance, it enables companies to know the ways of managing business by taking into considerations practices and standards of a certain environment. This is crucial because it enables companies to use marketing strategies that will help them carry out successful business in the international market (Salili and Hoosain, 2007). Secondly, it can help managers asses the cultural nature of a certain entity in which they market their business. International marketing requires business managers to take into consideration both local and international culture in which they market their products. Thus, it is vital for them to asses the culture, which is used in a certain environment in order to carry out business successfully.

How can culture impact a company?

Culture can affect the business environment in different ways. First, it can make the business suffer in case it does not conform to the existing culture of a certain environment. For instance, in case a business manager does not understand the values and attitudes of a certain culture in which he or she wants to market his or her products, then business could undergo certain problems. This means that nobody could be ready to purchase products that they are not familiar with therefore the company could end up encountering losses. Secondly, it can make the company encounter losses and perform poorly in the global market. Understanding culture is vital because it defines the norms, behaviors and performance of a company (Salili and Hoosain, 2007). Thus, if different cultural translations and awareness are not understood, then they will have an impact on the products, leading to poor performance in a company.

Question 2

Global Financial Management

What are the main challenges of global financial management?

One of the main challenges of global financial management is increased decline of real estate markets worldwide. The price decreases especially in the United States and Europe have remained a challenge in the financial market. This has contributed to poor performance of the business in the global market. In addition, another challenge is consumer and corporate credits. Consumer debt is another problem resulting due to low or non-existent savings and poor consumption patterns associated with high debts. Consequently, corporate debt is high therefore, the IMF is unable to restructure and refinance firms seeking to shun their defaults (Association for Financial Professionals, 2000). Moreover, the financial and macro-level infrastructures are not well developed especially in the third world. This is because the financers in the west can be able to lower rates without fearing inflation but in the third world, the situation is different. Moreover, loans are directed to high quality borrowers leaving many organizations unsupported.

What is foreign exchange risk management?

Foreign exchange risk management is whereby the currency value, inflows, credits and investments are preserved in order to enable the international business to compete overseas. However, it is difficult to eliminate risks thus anticipation of negative outcomes can be done and managed effectively by managers or organization entities. This can be done through familiarization with foreign exchange risks, demanding solid currencies and using hedging policies.

Is it important for companies going international? Why?

Foreign exchange risk management is important for companies going international because it enables these companies to determine the relative values of various currencies. This will enable the companies carrying out business abroad to interpret one currency in relation to another and thus determine if they are making losses or profits. Association for Financial Professionals (2000) reveals that foreign exchange risk management will enable business companies to anticipate the exchange rates and the effect they will have on the value of an organization. Besides, it will enable the company to forecast currencies and the kind of hedging strategies that they will employ. Lastly, it will enable the companies to employ tools and techniques that will match with the instrument to the predicament in order to enable them compete successfully in the global market.

Question 3

Discuss the Role of HR Management in International Strategy

The role of HR management in international strategy goes beyond hiring, firing and compensation. In essence, the purpose of HR management is to maximize the organization’s productivity through optimizing the effectiveness of its workers. However, because of the ever-increasing change in the global business, this mandate is likely to change at any time. According to Mello (2006), the fundamental mission of HR is to hire, retain talent, align the workforce to the business, and contribute excellently to the business. HR’s traditional role of replenishing and nourishing the workforce of the company, which is the greatest resource of the organization, remains, but HR management of an organization has over the years, undergone a few changes. Paauwe (2009) states that hiring the right people and training them well leads to business growth. This is because employers become familiar with different national cultures essential for making business successful in the global market.

Does your HR management support your International Strategy?

My HR management supports international strategy through providing human capital essential for international strategy implementation. They have people on board who are capable of defining and assessing people with skills necessary for supporting international strategy. International markets yield new opportunities thus HR managers implement international strategies through which companies sell products outside domestic markets. Paauwe (2009) comments that most HR managers derive basic benefits through using international strategies such as competitive strategy, new product development and increased market strategies in order to support their business in the global market.

Question 4

Explain the Advantages and Disadvantages of Open-source Database Management Software Relative to Proprietary Products

Open-source database management software offers diverse benefits relative to proprietary products. First, open-resource software is advantageous because it is freely available. The products are shared among many volunteer programmers and anybody can submit security patches and bug fixes. This means that bugs can be fixed quickly and software secured. Secondly, it enables businesses achieve greater penetration in the global market. This is similar to proprietary products, which penetrate faster in the global market. Many companies using these databases are able to establish organizational standards thus gaining competitive advantage in the global market. Another advantage is promoting the image of the company including its commercial products. Indeed, they contribute towards innovative products of the company due to technological developments. Lastly, they have led to building of developer loyalty and enabled them to have a sense of ownership directed towards the final products.

However, one of the disadvantages of open source database relative to proprietary products is that it can be user-unfriendly and it may sometimes be difficult to find an expert who will set it up in an organization. Moreover, even if these softwares are free, it may cost the organization in implementing the solution. Thus, balancing the cost of proprietary and open source software with the increased cost of implementation is vital. Finally, some databases are not well defined in the process of development (Mello, 2006). For instance, testing of the system and documentation may be ignored in the development process thus making it difficult to design commercially sound business models. Moreover, the hackers may figure out the weaknesses of the system in terms of security thereby contributing to poor performance of the business globally.




Association for Financial Professionals (U.S.). (2000). Global financial management

            compendium. Bethesda, Md.: Association for Financial Professionals.

Mello, J. A. (January 01, 2006). Strategic Human Resource Management. Finance India, 20, 4,


Paauwe, J. (2009) “HRM and Performance: Achievement, Methodological Issues and Prospects.” Journal of Management Studies, 46 (1).

Salili, F., & Hoosain, R. (2007). Culture, motivation, and learning: A multicultural perspective.

Charlotte, NC: IAP.



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