International Business Memo: Globalization - Coursework Example

International business Memo Globalization has created a lot of prosperity for a few and deprived the mass of whom it was targeted at. The objective of this memo is to define the role of globalization as well as the different ways in which economic varying models and trends will influence the bottom line of our company and our clients. The ultimate goal shall be to understand how our company can make the most of the promises of globalization and minimize its threats. The region is very suitable but to get a realistic picture we must be ready to go beyond a broadly optimistic plan. We need to approach the threats in a hard –nosed way. A number of them might be specific to this market, but they still need our consideration. I have identified credible concerns to our project that need to be considered before the ultimate decision is arrived at. The country also holds great promise that can be exploited to the good of both parties (us and the government). The three main issues we need to consider before we set off on this venture are local know-how, political stability and competition from government owned enterprises. I shall address them below in that exact order. Local know-how – We need by all means to establish a bricks and mortar presence on the ground. Our local presence must be well known in powerful circles too. The aim is not to get any favors or handouts from the Qatari government but rather to ensure a little more stability for our brand. The gulf can be a volatile region. The Muslim nations in this region especially experience serious anti-Western protests from time to time. At such times, the security of Western businesses and even Western staff can be greatly compromised. We especially need good protection at such times to avoid loss of human life of even property. Cultural know-how too means we shall be constantly be on a very important and steep learning curve. We need to constantly be updated on the culture and customs of this region as it has proven to be the difference between success and failure among several other companies who unsuccessfully set up shop before us. We need to be aware of increasingly changing cultural trends too. The other important element we need to observe is that of local talent. We need to identify talented natives who we can be able to bring on board so as to give our company its true multi-national face. The importance of this is such that we won’t look like we are trying to make money and then sending it all back home without some real benefits to the country especially in terms of employment creation in an age of mass unemployment. Another aspect of local know-how is a clear understanding of legislation concerning employment quotas. Most countries in their futile efforts to encourage foreign companies to employ locals have resulted into designating employment quotas. These might not apply to junior staff only; either they set quotas of even those who are to sit in the boardrooms. Qataris enjoy more rights than other peoples in other Muslim nations. As far as women are concerned, their freedoms are much more enhanced (Wallace). They can run for elective office. They can exercise universal suffrage, for instance and they are not subject to several limitations we have come to associate with typical Muslim nations like Saudi Arabia. Women’s rights are an important indicator of development. In that breadth, it should be mentioned that the kingdom has a high per capita income, higher if not equal to that of the United States. The economic stability, especially the kingdoms currency, the Riyal is closely pegged to the price of oil and natural gas. Political Stability – The Muslim world as is widely witnessed is undergoing great political changes. Leaders who have overstayed in power are being ushered out through peaceful street protests or even by violent means in cases like Libya. This is where the political system comes into play. Political systems in the region range from monarchies to dynasties, hardly democracies. Qatar to be specific is an absolute monarchy (Starting a business). Coups are very commonplace in the country with the last one that brought the current leader to power having happened in 1995. It should also be interesting to note that in that incident the current leader seized power from his father. Political stability ultimately can’t be within the control of a company like ours. What we can do is to assess the levels of the threats then decide if the whole project is worth the risk. However, what’s within our control is to decide not to take sides in political debate and just stick to our core business. Competition from state-owned enterprises – This is a central point in the overall strategy. The role of government in business, specifically in our sector needs to be evaluated. The leaders here have a history of getting what they want. They have bucket-loads of money which they can throw at state enterprises to ensure their success. In such an environment, we need to advocate for limited government interference if we are to succeed. If not we need to vie for some of those benefits too if at all we are to compete. Keynesian economics advocates for a mixed-economy, mostly by private sector but with some government contribution. This is the model that worked during the great depression, and it can be applied again now at a time of massive recession. This basically means limited government role in infrastructure development. By and large, as already suggested Qatar is an area worth your serious consideration (Wallace). I have deliberately downplayed the upsides of investing in this area so as put the threats in healthy perspective. The benefits are well known to you. From its strategic location to modernized economy that will provide a good market to our products. The threats, however, are dimmed when pitted against the blinding promise with which this tiny country shines. The three threats mentioned are worth your undivided attention. The local know-how especially is given such prominence because several companies who have chosen to ignore it have been doing something akin to searching in the dark. Political stability also can’t be ignored. If recent happenings in the region can be deduced from, Qatar should expect its share of demonstration at some point (Starting a business). We need to be prepared when and if it arrives. Lastly, competition from state-owned enterprises needs to be studied further. It could be the difference between a good and great investment for us. Works Cited Doing business in Qatar. Expert arrivals-local info for global expats, n.d. Web. 20 March 2012 from http://www.expatarrivals.com/qatar/doing-business-in-qatar Stiglitz, J. Globalization and its Discontents. New York: Penguin Publishers, 2002. Print Starting a business. Just landed.com, n.d. Web. 20 March 2012 from http://www.justlanded.com/english/Qatar/Qatar-Guide/Business/Starting-a-Business Wallace, Douglas. Consider Qatar, n.d Web. 20 March 2012 from http://export.gov/middleeast/country_information/qatar/ConsiderQatarGuide.pdf Read More