The significance of international business in contemporary organizations’ development cannot be overestimated. The major benefit from working in such environment is the increased opportunity of entering new markets. There is a number of disparities between domestic and international businesses. Griffin and Pustay (2015) outline the following aspects of international business as the most crucial ones:
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- the involved countries may have different currency systems, which leads to the need of converting currency;
- the countries may have dissimilar cultures, which presupposes the adjustment of the parties to the new customs;
- the disparities in legal systems may cause misunderstandings and lead to the need for additional accommodation;
- there may be different levels of resource availability in the involved countries.
One of the most important aspects to take into consideration with respect to international business is the company’s international competitiveness. Four key determinants of competitiveness have been singled out: demand conditions, factor conditions, supporting and related industries, and company structure, strategy, and rivalry (Wanjiru & Prime, 2018). Scholars remark that while factor attributes can justify the decisions associated with investment approaches, these endowments cannot fully explain the selection of resource distributions (Wanjiru & Prime, 2018). Therefore, knowing the main factors is not enough to lead international business successfully.
Finally, there is a highly significant factor to take into consideration when starting international cooperation, and this factor is the possibility of corporate wrongdoing. According to Nieri and Guiliani (2018), corporate irresponsibility is defined as the decision to accept an inferior alternative when the decision-maker knows that such an action will cause negative consequences for the organization. In order to avoid such instances, it is crucial for all organizations to take care of corporate ethics.
Griffin, R. W., & Pustay, M. W. (2015). International business: A managerial perspective (8th ed.). Essex, England: Pearson.
Nieri, F., & Guiliani, E. (2018). International business and corporate wrongdoing: A review and research agenda. In D. Castellani, R. Narula, Q. T. K. Nguyen, I. Surdu, & J. T. Walker (Eds.), Contemporary issues in international business: Institutions, strategy, and performance (pp. 35-54). London, England: Palgrave Macmillan.
Wanjiru, R., & Prime, K. S. (2018). Institutions, economic growth, and international competitiveness: A regional study. In D. Castellani, R. Narula, Q. T. K. Nguyen, I. Surdu, & J. T. Walker (Eds.), Contemporary issues in international business: Institutions, strategy, and performance (pp. 99-124). London, England: Palgrave Macmillan.