NJIT Course Information

Management 655

GLOBAL COMPETITIVENESS
School of Management, NJIT
Executive Education, Fall, 2005

David Hawk, Professor - Phone: (973) 596-3019
davidhawk@comcast.net
davidhawk.com

INTRODUCTION

     The course is to improve your understanding of the forces involved in international business (IB). You are aware of many aspects of what is what is considered IB but you may need a more robust conceptual scheme for fitting them into a pattern. These patterns are important to understand from where IB comes and to where it may be going. Various schemes and some additional parts will be supplied via the course.
     Emphasis is with IB operations within a dynamic environment. International is already an important part of most business operations but has yet to be fully accepted. Its growth is so significant that it may only be a matter to time before the international distinction gets dropped due to all business soon having an international link. Concern has recently shifted from questions with whether or not to go international, towards how best to manage the consequences of resources, products, markets and customers being international. The challenge is thus how best to manage international.
     Concern in leading international firms has shifted from choice between varieties of product life-cycle, or branding for strategic marketing, to dealing with time-lines that approach zero, prices that are less than costs, complexity that approaches infinity and humans that want to be unpredictable. Product focus has shifted from attaining quality via ever greater standardization to concern for achieving the qualities of infinite variety via an ever higher quality process. These and other challenges confront traditional models of management, including the historic international management theories. The traditional is thus left wanting.
     Views presented in the class will come from experience in solving problems of current international operations. Some review of historic literature will be necessary to place the present into some meaningful context. Risks will be taken in presenting parts of the course material, and as such some parts will undoubtedly miss their mark. Course content will rely more on the world of insights through examples than structure through accepting policies and practices. The course will attempt to be as fluid is the subject matter.

HELP-NOTES ON THE COURSE

     You live in an era when it is believed to be more beneficial to learn by experience than through ambiguous theories of what business management should be. In some ways this modern shift has been good. In other ways it fails to serve those who need to know. To await learning via only your own personal experience is quite slow, resource intensive, and often very painful. It is helpful, perhaps imperative for survival, to develop your skill in learning from others.
     The most common ways to learn from others is via the less experiential and more rational means of reading, watching and listening. These three activities have become critical to success in international operations. You need to develop your skill in all three.
     You also need to develop your appreciation of the difference between: “Don’t just stand there, do something!” and “Don’t just do something, stand there.” The first approach is said to be the essence of a U.S. business person while the second is thought to be more typical of the British. While both strategies are exaggerations the two give a meaningful basis for self-reflection, and open the door to the importance of cultural appreciation to international busienss. This introduces the problem found at the center of IB developments. IB learning seems foreign and strange. As such it may require other means to learn from it. To compensate we need models that are more robust - i.e., more accommodating of variety, change and difference. With this you can more efficiently learn about many things.
     International business operations appear far more ambiguous than those you have dealt with in the “safer world” of regional and national business. To accommodate the vaugness you will need to seek improved distinctions used as the basis for managing things; i.e., you will need to seek differences that make more of a difference. As an example of this you might consider moving the false dichotomy between theory and practice that business people traditionally love. Instead of practice over theory you might consider that “Nothing is so practical as a good theory.” (Kurt Lewin, 1936.) Or, in the U.S. is has come to be widely assumed that a “good” manager is one that talks loud and is aggressive. During this course you will see how such characteristics may in fact end up being great liabilities to non-national operations overseas. You will also see alternative patterns of R&D in overseas firms.
     The first parts of the course will outline two-hundred years of international business changes, along with an ongoing critic of each model. These will end with the dominant models of the early 1990s. From this basis we will try to find helpful ways to thing about what international business is and then move to a more normative level of what it ought to be. Several of the traditional functional management areas will be discussed in the course via how the addition of the international dimension changes them.
     We will be examining specific factors behind and involved in the IB process; e.g., the delegation of responsibility, size of operation, competitive advantage, marketing, etc. You know much about these factors within a national business context, but should now begin to wonder whether they are different in international activities. They are different; in fact so different that you should stop and question their contemporary use in national operations. In addition, we will cover the contextual conditions behind the process. In a short-form you might consider that factors determine which activities will be pursued and how they will be pursued, or avoided, while conditions determine the success or failure of your choices. Looking at one without the other is like studying finance in isolation from operations; which of course is what MBA programs are do good at doing.

Several points are worth keeping in mind during the course:

· You will note that the factors and conditions of business tend to become much more varied as your focus shifts from local, to national, and then to the international. A major, and obvious reason for this is the addition of greater cultural diversity, where culture contains the language, conceptual and activity basis that gives meaning to economic exchange; e.g., “Never involve family members in your business.” or “Only deal with those in your family.” (This is the cross-cultural dimension of the course.)

· New acts, concepts and models are constantly emerging from the field we now call international business. Some managers try to avoid them, some work on predicting the next generation, while others simply attempt to avoid the entire change process. We will be working with a fourth approach in the course - to try to find/invent concepts that take us where we ought to be, not where we are or where some predict we will be heading; i.e., a normative approach.

· The course emphasizes learning over education. The bias is towards articulation, and appreciation of models, not their memorization. This is consistent with the requirements of the second point, and is one the few means known to be capable of handling the complexity that results from the first point. Instead of acquiring a set of examples (cases) as a firm would acquire some technologies, the approach taken herein is to develop the infrastructure that invents technologies. This requires an overview, a framework, within which the underlying principles of international business can become obvious.

· A wide array of authors, models and concepts will thus need to be presented. To allow for greater efficiency these will be presented along with current and past examples of international firms. These will be primarily from Asia, Europe and the U.S., due to the limits of the instructors experiences. From this information you should see that international business is a moving and becoming phenomena that you can learn to appreciate and manage, not a fixed entity that you can know and control.

TEXTS and REFERENCES:

Texts:

· Articles and Papers on International Business
· Funky Business, Jonas Ridderstale
· The Art of War, 1994, Sun-tzu.
· Clausewitz On War, edited by Anatol Rapoport, 1968.

References:

· The Knowledge-Creating Company, Ikujiro Nonaka and Hirotaka Takeuchi, Oxford University Press: New York, 1995.
· Excerts from “Forming a NewIndustry: Globalization of Construction,” David Hawk, 1991.
· The Best of Russell Ackoff, 1999.
· Cultures and Organizations by Geert Hofstede, McGraw-Hill, New York, 1997
· Articles from the business publications.

RECOMMENDATIONS:

     You should begin reading the papers and articles as soon as possible. This gives a reasonable introduction to the course content. Then please read the funky business material first, then branch out into the other parts.
     The perspective given in the reading material and by the instructor comes from a variety of national and cultural viewpoints (American, European, and Asian). If you would like to learn more of the current mainstream US perspective on how to rationalize internationalization forces you might like to look at the work by Michael Porter. His books include: The Competitive Advantage of Nations (1990); Competition in Global Industries (1986) Competitive Advantage (1985); and Competitive Strategy (1980).You can find these in most book shops and libraries. When seeking them please make an effort to browse for additional subject matter on surrounding selves. This will give you gain a better sense of what the area of study is, from where it comes and to where it is headed. The fact that Porter's books are not used as a course text can provide an illuminating discussion point somewhere during the course. You may want to bring it up.
     The first segment of the course will address the history of the subject, give emphasis to the underlying definitions and concepts, and introduce an exposure to models for understanding international business. This will focus on the first four chapters of the Czinkota text and the handouts. The second segment will involve additional concepts that encourage model redevelopment. This will concentrate on the information in the two “strategy” books, and especially the differences between them. Several chapters in the Czinkota text will augment this information. Once again, examples of multinational company operations will be used throughout the segments.

PROJECTS & GRADING
There will be two assignments during the course. The specifics of these will be announced during sessions before the trip and at its end, where the last assignment is a trip report compiled in a special way.

TOPICS WILL INCLUDE THE FOLLOWING:

1. Reasons for, terminology about, and traditional models used to
explain international trade.

2. Internationalization concepts for the business of trying to transcend
traditional business: Emergence of international business (IB).

· The Individual ego
· The Local
· The National
· The International
· The Global
· Beyond The Ego

3. From where do these concepts come, to where they lead, what is the
next stage in this evolution? Does it matter?

4. International economic theories. When did they begin, where do they
end, and what do they mean for today?

5. International management theories. Are they any better than national
theories of management?

The history of hierarchy as a connector:
· Simon's insistence on hierarchy.
· The problems of hierarchy in international business management.
· Hedlund's heterarhical alternative for international business.

The product development alternative:
· Products as items that add value to the lives of others.
· Products as goods and services.
· Product development as an organizing principle.

Vengeance from the sins of our fathers:
· Emergence of cross-cultural levelers.
· The importance of the non-rational.
· Role of the eternal feminine.

Models of internationalization:
· Technical/Material development
· R&D Development
· Financial planning/management.
· Technological imperatives
· Emergence of new industries; i.e., finance, IT, bio-tech
· Cross cultural strengths and limitations.

6. Summary of previous session: How do the US, Asian, South American and European business regions respond to this set of issues and the choices they imply?

7. International strategy, ethics, and operations. (Can you be honest about your strategies?)

· International value-adding.
· International technological and sociological collaboration
· International R,D&D
· Counter-trade as a new model, that is very old.

8. Relationships between multinationals and their governments, and those of their competitors, suppliers, customers.

9. Alternative ways to think about international business. AIW, etc.

10. The mission of the multinational corporation and change. Future
issues and models for the future...

11. One More Time, with newer feelings: Greater appreciation and
understanding of what is required.

Shifting from “Data,” to “Information,” to “Knowledge,” and finally to consider the role of Wisdom. This is a shift from the world of things to the universe of Ideas. Some sample ideas are:

a. “A Rationale for Internationalization”
b. The Limits of Language.

· Terms as boxes that are difficult to crawl out from.
· What you see depends on where you stand.
· Alternative modes of problem solving.
· Management philosophies: a short history of the limits of method.

c. Problem types.
d. Logic …
e. Change/changelessness.
f. Environmental typologies, e.g., “Turbulence as your future.”
g. Interactivity as a way out.
h. Walls and product management
i. Myths…
j. International comparisons

12. One More Time, With Additional Meaning.

a. General International Theories
b. Theories of International Trade
c. Reasons for Going International
d. Ways to Enter International Markets
e. From Porter’s dreams to Alice’s realities
f. The Local context of Globalization

13. Items of international trade. (analyzing cute numbers)

14. The U.S. and International trade. (not-so-cute numbers)

· Items of U.S. Trade
· Levels of Imports/Exports (role of the Mac index)
· What Americans must have. (Is it good for them? For the world?)

15. Where have we come? To where should we go? Notes of optimism.