Guys, help me out, please

[bamademo]

After many years of taking only courses for technical certifications, I've gone back to college in my middle age and I'll have a degree, if all goes well, in Technical Management within a year. Trouble is my first course in a Management one and I have to submit mini essay questions every week. The first two weeks were no problem but I'm stuck on the assignment for this week. They want to know the advantages and disadvantages of multinational companies entering a mature market economy. All I can think of are disadvantages such as Peak Oil, most of the world despising Monkey Boy and Global Warming.

Any ideas? I'm not trying to get y'all to do my homework, I just want some genuine opinions which I will trade for all your Microsoft questions.

[juslikagrzly]

1. Little help here, but

if companies were run from an ethical standpoint without extreme emphasis on the bottomline (in other words, cared about producing safe and effective products, helping local economies, protecting and paying workers a fair wage) I think there are some advantages to a global economy. Fairness and balance are key.

For some reason, I always think about "Star Trek-The Next Generation" when thinking about the upside of globalization :).

Good luck. Don't need microsoft help, thank you very much. MACs rule!

[Celebration]

2. probably need a different board for ideas

Try some buzzwords like efficiency and competitive pricing. The economists at universities are all full of competitive efficiency models that show that free trade leads to greater output. And free trade is rather intimately tied to multinational companies which can easily move capital in and out of countries based on the various competitive advantages. These ideas are very well drilled into economics courses at all levels, and why so many people fall prey to this type of thinking--*without* thinking of the disadvantages-- which to my mind would be way too much concentration of power.

[immoderate]

3. I'm no expert but I think that achieving market share

could be a problem. You would have to counteract loyalties and relationships that have been built. a mature industry would have saturated its potential clientele. Gaining new business would have the additional burden of getting clients to break their existing business associations.

--IMM

[NMDemDist2]

4. not sure i can help, but what comes to mind is the word "mature" economy

are they speaking of (for instance) Europe? the EU is open to multinationals entering their economy but frown on excessive profits. Some EU countries are threating to levy a special "windfall" tax on the oil companies for the huge profits they posted last year

if a multinational enters a market and pays the prevailing wages, looks for strong steady growth (such as EU tries to do) I can see it being an upside. If they try to maximize profits on a quarterly basis with no thoughts to environmental damage or quality of life in the area (such as US corps do) there are definitely downsides


dunno if that helped but maybe i gave you some things to think about

[Rann]

5. Tax

Taxes

Tax
'Tax
and Tax
oh did I say Tax?

The Germans get a tax break for bribes they pay to other governments.



Environmental law, Codes, OSHA, Dollar currency, work hour, work week, customs,
One of the biggest advantages I see is the currency of Multi national companies dollar is always up or down.

[Kathy in Cambridge]

7. "The Germans get a tax break for bribes they pay to other governments."

I don't understand-can you explain this better? Thanks.

[Rann]

10. Germans

German companies get a tax write off for all the foreign bribes they make to further the business.

US has bitched about that for years.

[Kathy in Cambridge]

11. Can you provide a link for this?

I've never heard of such a thing. Welcome to DU, BTW. If you are making such assertions, it helps those of us that want to understand where you're coming from if you provide evidence to back up what you say.

[Rann]

12. Here

http://www.kalaw.de/english/areas_criminal%20liability.htm

http://www.amlaw.us/kastner1.shtml

Looks like it has changed a bit in 1997, just hear things in my company about Germany. (My company bitching about German firms bribing in over other bidders)

We lost a lot of contracts due to this. but we got back at them for Salt Lake City 2002 Winter olympics :)

[Spazito]

6. Ethical corporations can aid in enhancing the economy of

the countries they enter by setting a higher standard in salaries, environmental controls, putting a percentage of their profits back into the country they are in beyond simply expansion of their corporation itself. To be honest, I don't know of such a corporation to cite as an example but there MIGHT be one.

You may want to make the centerpiece of your assignment the influence of ethical versus unethical behavior of corporations and how that can positively or negatively effect the country it is entering.

(Just a suggestion, lol)

Edited to correct grammatical error

[Philosophy]

8. One "advantage" I can think of

Is that a multinational company can enter a new mature market and operate at a loss until its share in that market is established. Kind of like what Microsoft does all the time.

I probably read the question wrong.

[Mika]

9. Advantage only if you are a CEO

Look at it from that perspective. Golden parachutes, protected trust funds, hold back IPO pricing, insider trading, etc etc. Fully embrace the greed in your report. You'll get an A+ ;)

[Warpy]

13. Actually, there might be some advantages

if blind greed doesn't intervene.

Companies like Heinz have mutiple foreign plants that produce products mostly for foreign consumption (or did until very recently). The products they produced in the third world were far cheaper than those produced in the US and shipped overseas. People in those countries were employed, and demand for those products was created, and the products were cheap enough to afford.

This is a good thing. Everybody benefits.

What we're seeing now is companies CLOSING their plants in the US and using those foreign plants to supply goods and services to the US that US workers used to produce. Unemployed, abandoned workers cannot afford those goods and services, and eventually demand will be choked off. This is a system that may temporarily benefit the people offshore who are now employed, but it's not a system that can be sustained. You can't choke off your own market and expect to be successful for long.

The problem with the dogma of free trade has always been that it has benefited every country on the planet EXCEPT the good old USA.

That's basically it in a nutshell. It won't get you an A unless you expand on it considerably, though, and will be unpopular with the managerial class, period.