International Businesses Thrive in Competition- Essay Solution

International Businesses Thrive in Competition

(2461 words)

Question 2

Companies have to engage themselves with ethical norms and standards all the time. Engaging in unethical behaviour does have some adverse repercussions to the company itself. One such action would be the payment of bribes. Wei and Kaufman (1999, 1) defined bribes as “grease money.” They implied that it is used to facilitate a means to an end. The problem with the demand of bribes and even payment of bribes, it is still classified as unethical and corrupt. (Clarck and Xu, 2002, 1) On a general level, companies who tend to pay bribe requests are perceived to have a propensity to corruption, primarily because they condone it by submitting to bribery. Having a reputation like this would be considerably hurtful for the company.

On the other hand, the work of Perry (1998) provided several potential risks relevant to the use of bribery in international marketing. Specifically, he said that there are economic and managerial issues that may ensue in doing such actions. (p1940)  One of the managerial issue that could take place would be the distortion of the decision making process. When the issue of bribes comes to the equation, the decision making becomes considerably dependent on the amount of bribe to be given, not to the merits on which a selection is based on. In the same manner, paying for a bribe often places the payee at risk because it is rather unenforceable. As Perry (1998) puts it, it could be used against the payee. On specific countries, they have legal regime that prohibits any form of bribery. This means that aside from the adverse repercussions of the company, they are similarly liable to the laws of the land, particularly pertaining to fraud. Handling this issue thus rests on the hands of the top management of the organization itself. The existence of a sturdy and well-built regime for practicing internal governance is thus required among the companies themselves. This means that in order for corporate governance and avoidance of any unethical or corrupt actions to be avoided, the top level management personnel should be knowledgeable and well-trained in such a way that their actions are still in the bounds of the established legislation of the land. (p425) And lastly, Detomasi (2002) similarly indicated the need of a network of independent auditors that would serve as the needed link and check of corporate governance in general. (p425) This means that an independent body is required in order to monitor whether the actions of the top level management of companies do complement what the legislators have created, particularly the regime governing corporate governance as a whole.

Specifically, the top management have to stick with following the established guidelines of the company. One way of doing this is by strictly implementing a code of ethics within a company. To illustrate, companies operating in the United States are obligated to install a means of internal control as advised by law. (Myers, 2003, 28) Thus, developing a code of ethics is required of any company. The existing law forces companies to provide an internal control report inserted in a company’s their annual corporate report. (p. 28) This shows that a high level of transparency is required such that the company makes sure that managers do perform their responsibilities indicated in the codes of conduct. Companies should also ensure that the code of ethics would be understandable and imply a positive agenda. (Boudreaux and Steiner, 2005, 2) It would also help if the management does ask the employees themselves to work on the code of ethics of the entire organization. This could be accomplished by summoning representatives from every department of the organization. (Myers, 2003, 28) In this manner, the entire workforce has a moral responsibility of complying with their own established codes.

Question 3

Whistleblowing is defined as the disclosure of illegal practices of organization under the control of employers. (Dworkin, 2002, 458) The disclosure could be given by a former or current employee who felt compelled to report the said illegal matters to the proper authorities. Looking at the definition, there is obviously and inherent issue in this matter. Being a part of an organisation entail loyalty and dedication not only to the job but also the mission and vision of the company. Seeing the definition, whistleblowing does betray this assumed loyalty to the company. However, engaging in such action also points out the moral obligation of the whistleblower to society in general. In using ethical theories in defining the rationale behind whistleblowing, Kant’s and Mills’ theory may help clarify the matter.

The notion of moral autonomy was established into modem philosophy by Immanuel Kant in the later part of the eighteenth century. Kant was certain that the autonomy and dignity of the individual compelled that the person observe those laws provided by him or herself. (Guevara, 2000, 66) Basically, the model of Kant states that even supposing that people have diverse personalities for a lot of functions. Everyone have an equal lawgiving character, coined as Practical Reason. (Guevara, 2000, 93)  In the context of whistleblowing, the definition of the individual on what is right or wrong, immoral or moral, or even legal or illegal may trigger the decision to blow the whistle. However, in using utilitarianism of Mill’s, then whistleblowing is justified as a means to serve the good of the many. However, it must be noted that in using the perspective, one should concentrate on the results of an action as opposed on the inherent and central character of the action or the motivations of the agent. (O’Rourke, 2001, 113)  Thus, based on the philosophical claims of Kant, whistleblowers justify their decision to forego company loyalty because they are doing the right thing and that their action is considered moral if it is carried out for the benefit of duty and if its principle can be considered as a common norm.  While Mills may claim that cost of that deed generate maximum utility and happiness for all concerned, that is, stakeholders, employees, government, and the general public.

The problem of whistleblowing is that with the “good” deed taken by the whistleblower, there are certain risks that may place him/her on harm’s way. For instance, whistleblowers are seen as disgruntled employees motivated by greed and profit. (Robinson, 2005, 313) This may be possible for every whistleblower case in history. There will always be a part of the public that will be sceptical of the ends of the whistleblower. (Ernahrt, Geneson and Scarr, 1993, 91)

Another reality that whistleblowers have to accept is that they are susceptible to retaliation. (Cherrington, 2002, p. 381) There are accounts where the whistleblowers are harassed by the organisation. (Dworkin, 2002, 475) An example would be the US government’s treatment to its nuclear whistleblowers.  (Hadert, 2001, 80) The nuclear employees were presented to the media rather negatively by the government. For the most part, the scientists were discredited in the media while the plant workers are continuously harassed and “demonized.”

At any rate, companies have to take care of their own people such that acts like whistleblowing would be minimized. Normally, whistleblowing tends to be caused by misunderstanding among employees and the management. Companies have to make sure that their employees would go to them first before they go consult other people. The concept of the breach of loyalty among whistleblowers may be addressed when open lines of communication would be provided by the company. In a way there is some truth in the earlier mentioned attribute of whistleblowers being disgruntled employees. To address this situation, there is a growing trend among companies in installing their own whistleblowing policy within their organizations. In doing this, the company is able to minimise the risk of any more whistleblowing against them. In the same manner, doing such actions would essentially provide good standing relationships between employees and employers.

 

Question 1

International businesses thrive in competition. This also means that each and every company who operates in the international arena are constantly seeking their own competitive advantage to for self-preservation purposes but also to do extremely well in their individual industries. The emergence of the internet has considerably changed the way companies handle their business. This also offered the key for companies to other markets and medium of transacting with both clients and partners in the industry. There are several academic articles that have indicated the effects of the internet in international businesses. Leamer and Storper (2001) claimed that the emergence of the internet as a business tool created a “new economy.” (p. 641) Other authors have also indicated that the appearance of such technologies online have triggered the “death of distance” and even “end of geography.” (Buckley and Ghauri, 2004, p. 81) Though these claims may appear to be rather ominous, international businesses have used these situations to their advantage. The internet has given the modern business a chance to tap into new possibilities of transmitting messages through ICTs. (Leamer and Storper, 2001, p 643) This means that a company is able to operate in opposite sides of the world without any significant risk of loss. Today, manufacturing companies tend to have a headquarters in a specific area and operational plants in other locations. (Leamer and Storper, 2001, p 643)  This need even made a new form of industry. This is manifested in Dot.com companies, providers, and developers that offer their services to those who have access to the web and those who intend to use this medium as their primary conduit to success.

A number of companies have used the internet as a means to take international market by storm. One example would be the case of Amazon.com who has dominated the online retailing industry. They have initially started as an online bookstore, but they eventually expanded their market. Other companies like Apple Inc have also been successful in expanding their market using the internet. Aside from offering their gadgets and computers in stores and online, they have also created a new culture. Godwin-Jones (2005, p. 17) refer to this as the iPod Phenomenon. Specifically, the wide distribution of Apple of its famous player has triggered other companies to launch their own brand of mp3 players. And as versions of the mp3 players constantly improve, it still leaves the fact that it is essentially a means of listening to records, albums, and music. In some cases, they use it for educational purposes. (Blaisdell, 2006, p. 30) Other industries use the internet as a means to secure a clientele that would use the services they offer. In the airline industry, the internet has become one of the major factors in the sale and bookings of airline tickets. The internet has been considered as among the low cost medium to which bookings and ticket sales among airline companies employ. (Bouvard and Somosi, 1997, 173) The use of the internet has also enabled these companies to easily tap the international market given the range on which internet access is able to provide. Moreover, the connected industries like tourism have similarly benefited in the use of the internet as a medium for travel access. (Molina and Rayman-Bacchus, 2001, 589)

In looking at this perspective, the internet has, without a doubt, influenced the development not only of conducting business but also the general society as well. However, behind the sugar coating embellished by gadgets and convenience in interaction, there are elements in the equation that tends to be reacting adversely to these. As stated earlier, the emergence of the internet has given internationalisation and globalisation. It is not that these two elements are inherently horrible; it is just that with these internationalisation and globalisation subsequent issues regarding free trade and fair trading come to play. Apparently, the existence of free trade provides an advantage to everyone considering the open access to goods and services that is able to grant states with the most favorable opportunities for development. However, in a more realistic sense, the emergence of globalization favors predominantly the wealthy nations. It is possible that these countries, given their influence in the international community, are able to manipulate to their advantage the rules regarding trade. (Hersh and Schmidt, 2000) In this context, the economic institutions of the international community are thus being possibly controlled by the powerful nations while developing and other least developed countries suffer in this injustice.

Though companies have the capability to emerge anytime using the web as its medium, the country of origin of the company may still have a factor in the equation, and a major one at that. A factor to consider is the capability of a country to support a web-based business sector. As said by Buckley and Ghauri (2004, p. 81) the internet is basically dependent of infrastructures to actually be efficient. This means that governments have to provide for the necessary structures that would be able to support the web environment. The essential factor of connectivity that the internet offers thus would determine as to whether companies in a certain country would be able to compete head-to-head with other companies in on the other side of the globe.

However, Leamer and Storper (2001, p 643) pointed out that these lack of infrastructure from developing countries tend to be mere initial constraints for competing in international business. They pointed out the emergence of other business methods like outsourcing and some of the familiar ones like foreign direct investments. Companies from developed countries could balance this seeming inequality out of the picture. To illustrate, architectural firms are beginning to acquire the services of countries like China and Australia because of the cheaper rate of labour. (Leamer and Storper, 2001, p 643) On other instances, foreign direct investments tend to provide a demand for higher qualifications and skill levels on the labour force. This indicates the need for developing countries to improve on their own competitive advantage. For most developing countries, labour and cheaper operational costs are their primary advantage with other countries.

At any rate, competition in international business tends to still settle on the advantages held by companies. As indicated in classical theories of trade, each and every organisation have a certain element that could differentiate themselves with other players in the industry. Regardless of whether the country is classified as developed or not, individual companies still have the opportunity to compete with other organisations all over the world. The emergence of modern technologies like the internet is mere means to wield this opportunity. However, the presence of the infrastructures that improve the internet capabilities of a nation would help in keeping companies in the said country stay connected with the rest of the international business community. This capability thus adds to the advantages that companies have over the other players in the industry.