The decision to establish international companies is associated with numerous benefits as it is demonstrated in the discussion post. Continuing on the topic addressed in the post, going global involves significant expenditures, but its positive effects in terms of revenues, workforce, and improving a company’s social image cannot be overstated (Gémar, 2014). However, when it comes to the key difficulties related to having international businesses, it is paramount to focus on the presence of internal resources, proper goal-setting practices, and compliance with ethical norms.
In fact, problems related to international businesses are inextricably connected with economic development. Internalization may seem attractive to many companies, but it is clear that only the largest and strongest market players are able to implement such strategies. This inequality takes place since expanding businesses is impossible without an “internal strength” (Lai, O’Hara, & Wysoczanska, 2015, p. 80). In this connection, the opportunities to go global can be limited by the country’s economic position, development perspectives, and other factors.
Another problem that should not be underestimated when making decisions concerning internationalization is the need to choose the key host regions based on thorough analysis and realistic goals. Discussing this topic, modern researchers emphasize the necessity to focus on the right motivators. As is stated by Lai et al. (2015), the key types of motivating factors are “market-seeking, resources-seeking, efficiency-seeking, and strategic asset-seeking” (p. 80). Importantly, many multinational corporations in China are believed to be driven by the need to gain more strategic assets (Lai et al., 2015).
In the end, the impact of some local scandals and the cases of misbehavior on the reputation of a company also presents a challenge associated with internationalization. Among the brightest examples of the problem is a series of scandals with Burger King’s advertising campaigns in Russia (Embury-Dennis, 2018). Thus, apart from pecuniary benefits, expanding worldwide involves taking the degree to which ethical standards are respected under strict control.
References
Embury-Dennis, T. (2018). World Cup 2018: Burger King sorry for offering lifetime supply of Whoppers to Russian women impregnated by players.Independent. Web.
Gémar, G. (2014). Influence of cultural distance on the internationalisation of Spanish hotel companies. Tourism & Management Studies, 10(1), 31-36.
Lai, H., O’Hara, S., & Wysoczanska, K. (2015). Rationale of internationalization of China’s national oil companies: Seeking natural resources, strategic assets or sectoral specialization? Asia Pacific Business Review, 21(1), 77-95.