GLOBAL BUSINESS MANAGEMENT DISCUSSION QUESTIONS 67 - Essay Example

MODULE 6- KODAK IN RUSSIA Western nations were more informed about Kodak's products compared to Russia. They have a more developed market for photography than the Russian market. Unlike the West, a good infrastructure for the distribution of the products did not exist in Russia. Russian citizens were also unlikely to afford Kodak's products. Black practices were also common in Russia.Not being well informed about a company's products can prove to be detrimental to the company's image. If citizens are not aware of the existence of products, it is obvious that there would be no demand for them.

Similarly, not having a good distribution infrastructure would cause difficulty in the product reaching the consumer and thus result in a decline in demand for the product. Also, demand for expensive goods in a poor country is very low. Black practices also affect the demand for products adversely. 2. First, Kodak aimed at making the Russian citizens aware of its products and for that it communicated with them through various forms of media; television, radio, print, etc. Promotional campaigns and sponsored events were carried out for this purpose.

1 Second, Kodak spent heavily on promoting a corporate image of the company in order to convince the public that it does not engage in black practices, which were once very common in Russia. Third, because the Russian market was comprised of low-income consumers, Kodak aimed at selling cheaper cameras and films to them.Fourth, Kodak encouraged large enterprises to provide cameras to their employees in order to stimulate demand. And finally, Kodak worked on its distribution infrastructure by setting up a franchise program and opening well maintained stores all across Russia which were staffed by amiable employees.

All the marketing tactics that Kodak implemented were the right measures to take in order to encourage demand in a country that posed numerous challenges otherwise. The measures taken proved to be favorable for both Russia and Kodak and hence were the right tactics to employ.3. Adjusting its marketing mix for digital photography in Russia should be thought of at a later stage. Since the concept of photography on the whole is new to the nation, it may be a long time before digital photography can be introduced in the market.

Kodak needs to first research on whether or not the market for traditional film photography is saturated. Once it has reached the maturity stage in the product lifecycle, it will be a favorable time for change. It is only then that Kodak's digital photography can be launched in Russia.MODULE 7- ADOPTING INTERNATIONAL ACCOUNTING STANDARDS1. a) Adopting international accounting standards would ease the comparison of financial statements of firms in different nations for the investors. It prevents any major crisis from taking place.

It would also eliminate the occurrence of any conflicting practices and bring every firm to equilibrium. This would help investors taking right decisions when it comes to investing large sums of money. Hence, this change from the traditional manner of operations to an international accounting standard would bring benefits to investors.b) Although some large enterprises have experienced a reduction in their assets when moving towards the adoption of international accounting standards, others have seen benefits.

More profits have been reported after having adopted the standards compared to the pre-adoption period. It may enable them to make informed policy decisions and prevent financial distress that would have not been possible in the pre-adoption period.Therefore, this shift to international accounting standards is necessary in order to achieve benefits to large enterprises. 2. There may be differences in the manner certain steps are taken in every firm. In the case it has been pointed out that the adoption of international accounting standards, it was shown that Japan usually had lower earnings and also weaker balance sheets which pose as a threat to the nation.

2 The way Shell accounted for employee benefits reduced the value of its assets tremendously. Similarly, because of the change in the manner some classes of stock were classified, the worth of L'Oreal fell by a large amount. Hence, the examples mentioned in the case go on to show the potential threats adopting international standards may pose. 3. China being a third world developing nation requires more revision in the financial performances of business enterprises. China's own set standard China Accounting Standards (CAS).

There exist various differences between CAS and IAS. First, Accounting Standard for Non-monetary Transactions involves exchange of similar or diverse assets and such a standard does not exist in IAS. Second, China uses the historical cost method as opposed to fair value. Third, CAS has a different effect on the current profit of firms. 3These differences in the two standards are due to a number of factors. Firstly, the users of the systems in developing countries are different than that in developed countries.

In China, institutional investors do not play a very dominant role as they do in developed countries. Secondly, China pays a great deal of attention to net income as opposed to comprehensive income in IAS. And finally, a fair market is still developing in China; therefore a fair value might not be favorable as yet. REFERENCES1. Hill, Charles. Kodak in Russia. International Business: Competing in the Global Marketplace. Irwin/McGraw-Hill. 7th Edition, pg 619. 2. Hill, Charles. Adopting International Accounting Standards.

International Business: Competing in the Global Marketplace. Irwin/McGraw-Hill. 7th Edition, pg 671.3. Xiaoming Li (2006). Convergence of China GAAP to IAS. Journal of Modern Accounting and Auditing. South China Agriculture University. Vol. 2, No. 2, Serial No. 9