Chapter 01 – Globalization and International Linkages
Questions and Answers Following this Exercise
1. Which of these companies seems best positioned in Southeast Asia?
Answer: Opinions will vary. Jollibee has the most extensive menu aimed at this part
of the world. They also have an extensive menu that competes with McDonald’s and
2. What advantages might a “local” brand like Jollibee have over the global
companies?
3. What is your prediction in terms of future growth potential?
Answer: All three companies are seeking to expand their worldwide operations to
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Chapter 01 – Globalization and International Linkages
In The International Spotlight: India
Questions and Suggested Answers
1. What is the climate for doing business in India? Is it supportive of foreign
investment?
Answer: The purpose of the first question in each of the “Spotlight” cases is for the
instructor to bring in current happenings in the country featured. The suggested
answer below may be somewhat dated by the time you go over this in class but can
be used as part of your discussion and as a point of departure for new material.
choice: India or China? Additionally, foreign investments are having a very positive
effect on the Indian economy.
2. How important is a highly educated human resource pool for MNCs wanting to
invest in India? Is it more important for some businesses than for others?
Answer: Highly educated human resources would be extremely important because
it means that the MNC can draw on local talent to help staff and manage its
operations, even high tech operations. If the work force were poorly educated, it is
3. Given the low per-capita income of the country, why would you still argue for India
to be an excellent place to do business in the coming years?
Answer: In addition to the above-mentioned points, there are other attractions that
make it likely that India will be an excellent place to do business in the coming
Notice how low wages are compared to similar jobs in the U.S., Japan, and Western
Europe. The big question mark surrounding India is its political stability, and its
ongoing boarder disputes with Pakistan.
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Chapter 01 – Globalization and International Linkages
International Management in Action: Tracing the Roots of Modern
Globalization
Summary
1. Globalization is not new. Consider this concept in terms of historical events before
reading the article. Think the Silk Road and other trade routes dating back
thousands of years. Then review the examples in the article:
Middle Eastern Intercontinental Trade: King’s Highway (Royal Road), Silk
2. Globalization in U.S. History
Trade with England
Today
A Closer Look: Outsourcing and Offshoring
Summary
Offshoring: The process by which companies undertake some activities at offshore
locations instead of in their countries of origin.
Outsourcing: The subcontracting or contracting out of activities to external
organizations that had previously been performed within the firm and is a wholly
different phenomenon.
The two have combined in offshore outsourcing. Offshoring began with
manufacturing and, with globalization, expanded to services like call centers, R&D,
information services, legal work, and banking services. Sensitive information and
privacy issues are of concern.
Source: Pete Engardio and Assif Shameen, “Let’s Offshore the Lawyers,”
BusinessWeek, September 18, 2006, p. 42; and Tony Hallett and Andy McCue,
“Why Deutsche Bank Spreads Its Outsourcing,” BusinessWeek, March 15, 2007.
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Chapter 01 – Globalization and International Linkages
International Management in Action: Recognizing Cultural Differences
Summary
1. Doing business overseas cannot happen without learning about and trying to
understand the customs, cultures, and work habits of people in other countries.
2. The example of Russia follows. Russia is moving from a central to a market
economy, and management is changing along with that new direction. The U.S. and
Russia interpret “partnerships” differently. Management in Russia is more
3. Websites: {http://www.usrbc.org}, {http://www.careerwatch.com}
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Chapter 01 – Globalization and International Linkages
International Management in Action: Brazilian Economic Reform
Summary
1. Brazil has transformed itself from a relatively closed and frequently unstable
economy to one of the global leading “BRIC” countries and the anchor of South
American economic development.
The Plano Real (Real Plan, 1994) sought to peg the real to the U.S. dollar in
order to bring inflation down. Brazilian goods became more expensive relative
Brazil has expanded exports from argricultural products to include
manufacturing and services. Other countries and many businesses are investing
in Brazil’s economy.
2. Websites: {http://www. wto.org/english/tratop_e/tpr_e/tp312_e.htm}
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