International Business Environment: Challenges and Changes

Abstract

In the twenty first century, Business Environment is becoming more complex, interdependent and dynamic. Managements have to restructure their strategies and management styles according to the regions of the world, they are operating in. The typical challenges that managements face are political, economic and cultural changes along with advancement in technology. In addition to the vast opportunities while operating in global community, it is also associated with relative high risks and the projected return on investments in the global market. Business Environment risk has increased obligations of managements to improve their ability to develop, produce and market global brands. To compete aggressively, organizations have to make considerable investments globally, not only capital investment but also human resource investment like trained managers, skilled workforce to operate effectively in a multicultural environment. Managements are focusing to become accustomed to global environment change and attain new capabilities, in job skills, modes of learning, management approaches and research efforts. Managing political and economic risk is a challenge for multinational organizations, they have to maintain an up to date profile of countries they are operating in. Global operations of organizations are also associated with social responsibility, ethical behaviour and interdependence which directly affect their sustainability and profitability. The ethical challenge that globalization presents is political and economic freedom, that is essential for the development of any society, but human resource development is critical in developing these capabilities. Due to interdependent nature of developing economies the global organizations must set high ethical norms and lay the groundwork for future economic development by cooperating with social, political and economic conditions prevailing in the regions they are operating in.