Success In A International Business

By Nilaan Sritharan

Introduction

With hundreds of international businesses around the globe, many companies want to accomplish one thing; be a successful international business year after year. A successful international business is defined as business transactions that can cross national borders at any stage of transaction and can provide their goods, services and resources internationally efficiently. In this report we will be taking a closer look at factors that can lead an international business to success. Having a great knowledge in the following significant factors; innovation, consistency, business strategy, government regulations, outsourcing, culture and corporate social responsibility can differentiate an international company from a successful international business.


Innovation

There are several reasons why the generation of new ideas can be critical for a business to be successful in the international field. As every organization will have its own priorities and sector-specific issues to balance, businesses that fail to innovate run the risk of losing ground to competitors, losing key staff or simply operating inefficiently. Innovation can differentiate between market leaders and their rivals in the international sector. For an international business to be successful it not only needs to responds to their current customer or organizational needs but also often anticipate future trends and develop an idea, product or service that allows them to meet the future demand rapidly and efficiently. Innovation will help a company stay ahead of their competition in terms of markets, technologies or trends shifts. During the Christmas season, many retailers have found new strategies to stay competitive among online retailers by offering price matches and free same day shipping. “This will be the first holiday shopping season where [stores] are making a more concerted effort to avoid bleeding sales to online retailers” (Townsend) This helps companies innovate their company as it offers services and merchandise that one cannot find online, increasing the company’s revenue and awareness. Internationally known companies such as Macy’s and Nordstrom have recently opened with their own online inventories. This has helped salesmen close a sale by offering out-of-stock products from another store or from a website for free. One of the world’s successful companies, Wal-Mart has reported more views and sales after opening an online inventory too. As technology is rapidly improving, it is cruel for an internationally successful company to be continuously innovating their company by creating ideas, products and services that satisfies their consumers but also the employees of the company by making their jobs easier. This will bring in revenues and company awareness leading to its success in the international sector.


Consistency

There is a secret power that drives international businesses to succeed, and can be summed up in one word, consistency. Consistency means providing, predictable, reliable to the consumers every time you do business with them. When having a product or a service that one buys for the first time, it means they’re interested in your company. Once the consumer experiences a good first time, they may spend their money with you a second time because the consumer believes that they will get the same experience as the first time. If they also experience a great second time they are bound to return for many more visits after because of the companies level of consistency. For instance visiting McDonald's in California or Connecticut, America or Australia, you will have similar experiences wherever you are. This is because customers know what to expect and can take comfort in that knowledge when making decision on where to eat because of their consistency. McDonald’s menu innovations have allowed the top fast food company to hold offerings for all meal times, and the snack periods that in between, allowing for greater profitability. When he arrived in Southern California, he was intrigued with what he witnessed – a restaurant that was efficiently serving a large number of customers who seemed pleased with the food they were receiving. (Franchise Direct) These effort towards repetitions and efficiency not only sets the basis for McDonald’s success from the standpoint of customers’ expectations, but also helps McDonald’s stay on top in a culture where producing at a quick pace is commonly expected. The first visit sets the benchmark for the customer experience; the second visit either confirms or does not confirm consistency in the mind of the consumer. As McDonald's continues to serve their customers at a fast pace with good food at a reasonable price, it has lead their customers to buy their food on a regular basis. Successful international business know that customer satisfaction comes from giving customers what you tell them you’re going to give them and giving it to them consistently as McDonald's has efficiently demonstrated this business trait to remain the leading fast food restaurant in world.


Business Strategy

Business strategy is a cruel asset for a company to be successful as the big picture shows how all the individual activities are coordinated to a desired end result. This allows the direction of the company to be set. Good strategies should take into account external forces, increased competition and changes in customer needs and expectations. A business is highly effective in retail trade because as fashion trends tend to change season to season, retail companies should know how many of each of their product they should provide to their consumers. If these retailers have a slight of a “fashion miss” it could mean markdowns, which could hurt the retailer’s profit and company image. For example, companies such as Zara have a strategy that involves stock very little and updating collections often. “Instead of other brands that only update once a season, Zara restocks with new designs twice a week” (Why The Retail Industry Can't Keep Up With Zara) As you can see Zara’s business strategy is to encourage customers to comes back to the store often just so shoppers can buy the most recent fashionable clothes. Also since Zara stock up very little in their stores, when shoppers want to buy something, he or she feels that they have to buy it in order to guarantee it won’t sell out. This genius business strategy has helped Zara to expand rapidly to other countries, while other customers still struggle to get customers into their stores. Zara’s business strategy has also helped them compete with top companies such a Louis Vuitton and Prada as they are forced to make four to six collections instead of two a year. As a result a business strategy is significant in order for a company to succeed internationally.


Government Regulations

Since businesses and governments often have conflicting agendas and priorities, the relationships between governments and business can be complicated at times. Government regulations are the “fact of life” in any industry and businesses that learn how to work with rather than against government authorities can save themselves a good deal of time and effort dealing with fines and other legal issues. Government regulations can often work to increase profitability of a business. This is because the success of business requires a certain cruel amount of confidence. In India, the land pooling policy, which pictures voluntary assemble of land by land owners, was implemented with the Lt – Governor approving regulations requiring for operationalizing the policy “The new regulations permits construction up to 17.5 metres as opposed to 15 metres with provision for stilt parking in the building” (L-G approves regulations, land pooling to be operational soon.) With this approval of the Indian government it ensures the construction company, DDA flats is looked into so that there are no complaints and there is increased consumer satisfaction. With the loss of consumer confidence it can leave a company is a disaster and consumers always want to ensure the products they buy or invest are not going to hurt them satisfaction With the approval with government regulation it may also help a company ensures it is always in task in order for the company to reach its goals or deadline. Therefore it is vital for a company to ensure the laws and regulations in foreign countries to eliminate any shutdowns or other stoppages from the government.


Outsourcing

Outsourcing has become one of the hottest topics in international business as it allows the important processes in your company to handle by experts in the field of selling products and services in foreign companies. When it comes to employing people to carry out the same operations, it would require quite a considerable chuck of time to train staff as well as the need to buy all of the essential equipment, which leads to a company spending lots of money to be spent. By avoiding the task of over employing staff members, employees will also be able to free up more time to focus on delivering their goods to their customers and carrying out the tasks that they were employed for in the first place. Canadian construction companies, TransCanada and Outsourced Construction Services have demonstrated outsourcing which has led them to their success. These companies have sent they’re top employees to different parts of the world so that the projects are completed on time as well as cutting down money to train new employees. “More small businesses are outsourcing tasks these days because technology has advanced to the point of professionals being able to work from anywhere in the world, coupled with the availability and accessibility of extremely qualified professionals who have decided or been forced to leave the corporate world, [such as] virtual executive assistants, marketing directors, graphic designers, transcriptions, paralegals, web designers, HR consultants, bookkeepers, PR directors, IT specialists, and the list goes on,” (How to Build a Better Business with Outsourcing) From this quote you can depict that it is effective to move your employees from one project to another in order to grow your business instead of hiring a new person each time to fulfill a task. This is what John Owen; the President of Outsourced Construction Services has done to expand his company internationally. With 25 years of experience, Owen has held positions as Construction Manager and Senior Project Manager and understands how to work with construction companies internationally. He also understands how to cut down unnecessary labor costs by sending off their construction workers and management teams around the world to fill in job positions and to complete projects. Outsourcing has given the opportunity of a company to expand their business, gain international standings and acknowledgements.


Culture

Conducting businesses on a global basis requires a good understanding of different cultures. What works in one country might not work well in another and might even be interpreted as an insult. One of the many roles of an effective project manager is to raise the awareness of cultural issues within companies’ project teams and organizations to ensure success. We live in a generation where trade is becoming more global by the day. The capabilities of fast communication between people and places have boosted many companies to expand into other countries. However, cultural differentiations are the most sustainable features companies need to take under consideration, in a strategic planning of setting up abroad. A firm needs to become progressively more aware of the foreign cultures when aiming for a successful future in an international business environment. For instance many fast food restaurants understand culture ethics in other countries which have helped them expand their business internationally. “But Indian customers aren't just ordering the Tex-Mex treats known in the U.S. Yum Foods, Taco Bell's parent company, came up with a bunch of special menu items designed for local palates: crunchy potato tacos and extra-spicy burritos filled with paneer, the rubbery, fresh Indian cheese.” (Stern) From this, we can observe that Taco Bell is able to take their products they sell in the US and modify their menu board just so people are able to buy Taco Bell’s products in India. India is a tricky market for food chains as Hindus don’t eat beef and Muslims don’t eat pork. By Taco Bell modernizing products for consumers it shows the respect to Indian culture with has led to 2,500 people lining up day after day to try burritos and quesadillas helped by employees hiring to explain what the food products are. By taking the exact business in North America and placing it in countries in Asia could offend some people. By not understanding the culture in each country; it will be difficult for a company to expand internationally or could ruin business deals and friendships of consumer, governments and people when having an international opportunity just because the oppose parties are being offended or not being treated with respect.


Corporate Social Responsibility

International companies that have effectively engaged in corporate social responsibility experience many benefits. They enjoy positive effects on the staff retention, recruitment and motivation. They experience increased customer satisfaction and loyalty, particularly when customers buy products or services based on relationships, trust and reputation, or brand. Successful social responsible companies have better reputations, better detecting and responding to risk, and are able to anticipate the needs of their stakeholders with greater certainty. As a side effect of their efforts, these companies can experience operational efficiencies and cost savings. They also have an improved ability to innovate, develop new products to meet customer needs and leverage creativity of their stakeholders. Google a top international company has demonstrated CSR for many years which have held them to their success. “Gone are the days when social responsibility meant limited returns,” Johnson notes in her analysis, pointing out that Google is a typical pick for socially responsible exchange-traded funds (ETFs) and mutual funds.” (Corporate Social Responsibility – Company â Google) The California based-company is now running its sites from winds and solar power and has a goal of achieving 100% renewable energy for all its facilities. As Google has a passionate belief on environment protection the company has promoted their organizations to foreign companies like China and Africa. CSR has an important role in the government and in businesses. Foreign are encouraged to participate with the communities and concerns of people.


Conclusion

In conclusion, international businesses need to reflect on different factors in order to succeed. Seen through the following factors in this report; innovations, consistency, business strategies, government regulations, outsourcing, culture and cooperate social responsibility will assistance any company to perform and succeed internationally. In all honestly running a business is a very tricky balancing act. Nobody gets it right all the time, even successful business leaders make terrible mistakes; they just recognize them, learn from them and move on.


Appendix

Name: Nilaan Sritharan

Date: October 2nd, 2013

Business Name: TransCanada

Industry: Construction

Topic: Outsourcing

Subtopic: Public Relations

Title of Article: TransCanada's Southern Keystone XL leg to be Completed Soon"

Link:
http://ca.reuters.com/article/businessNews/idCABRE9910M120131002

Source Name: Reuters Canada

Type of Source: Newspaper

Date of Source: August 8th, 2013

Synopisis:

1. The 700,000 barrel per day pipeline will carry crude oil from Cushing, Oklahoma, delivery point of the U.S. crude oil future contract, to the Gulf Coast

2. The line fill is expected to draw a significant volume of oil stocks from the Cushing storage hub, traders said

3. The decision on building the northern leg of Keystone XL, which would carry crude from the Canadian oil sands to Cushing, is not expected to be made in Washington until next year


Name: Nilaan Sritharan

Date: October 9th, 2013

Business Name: TransCanada

Industry: Construction

Topic:

Subtopic: Politics

Title of Article:

Construction levels in Burnside exceed 2011, 2012 totals

Link:

http://www.burnsidenews.com/Opinion/Columnists/2013-10-09/article-3420736/Construction-levels-in-Burnside-exceed-2011,-2012-totals/1

Source Name: The Burnside News

Type of Source: Newspaper

Date of Source: October 9th, 2013

Synopisis:

1. Council just passed the Main Street Plan at a September public hearing. The Main Street Plan is designed to attract investment and, perhaps more importantly, reinvestment in the commercial area of Main Street, Dartmouth. The intention is to provide tools and incentives that will lead to redevelopment.

2. The manufacturing sector is growing and 2014 is expected to see growth across the goods and services sector.

3. The Greater Burnside area is a very significant part of District 6. It’s one of Canada’s largest business parks and a major economic driver of the Halifax Regional Municipality, with more than 1,400 businesses employing more than 18,000 people.


Name: Nilaan Sritharan

Date: October 16th, 2013

Business Name: TransCanada

Industry: Construction

Topic: Singapore Expansion

Subtopic:

Title of Article:

Singapore Looks Below for More Room

Link:

http://www.nytimes.com/2013/09/26/business/international/crowded-singapore-looks-below-for-room-to-grow.html

Source Name: New York Times

Type of Source: Newspaper

Date of Source: October 16th, 2013

Synopisis:

1. Singapore, with a little less land mass than New York City, is running out of room for its 5.4 million people.

2. So Singapore is considering a novel solution: building underground to create an extensive, interconnected city, with shopping malls, transportation hubs, public spaces, pedestrian links and even cycling lanes.

3. The squeeze has led to the closing of several old estates and military camps to make way for residential and industrial developments.


Name: Nilaan Sritharan

Date: October 23, 2013

Business Name: Spain’s Government

Industry: Construction

Topic:

Subtopic: Spain’s Recession

Title of Article:
Spain's recession over _ cold comfort for jobless

Link: http://www.myfoxaustin.com/story/23764101/spains-recession-over-cold-comfort-for-jobless

Source Name: My Fox Austin

Type of Source: Newpaper

Date of Source: October 23,2013

Synopisis:

1. Despite the emergence from recession, the government predicts the economy will shrink 1.3 percent for 2013 as a whole. Next year, it is forecast to grow a meager 0.7 percent. Independent analysts are more pessimistic, with some predicting the economy will go into reverse.

2. Spain's banks are in much better shape than they were last year, when the government borrowed 40 billion euros ($55 billion) from fellow eurozone countries to shore them up. However, figures show the banks still carry worryingly high amounts of bad loans and are struggling to sell off devalued property.

3. Creating the most pain in Spain is the worst jobless rate in the European Union after Greece. For people under age 25, it is a stunning 56 percent, prompting many to emigrate to Britain, Germany and Latin America for work.



Work Cited

"How to Build a Better Business with Outsourcing." Entrepreneur. 13 Jan. 2014 <http://www.entrepreneur.com/article/204652>.


"L-G approves regulations, land pooling to be operational soon." L-G approves regulations, land pooling to be operational soon. 13 Jan. 2014 <http://indianexpress.com/article/cities/delhi/l-g-approves-regulations-land-pooling-to-be-operational-soon/>.


Stern, Steven. CNN. 08 Apr. 2010. Cable News Network. 13 Jan. 2014 <http://www.cnn.com/2010/LIVING/homestyle/04/08/fast.food/>.


"Success of McDonalds." Franchise Direct. <http://www.franchisedirect.com/information/trendsfacts/thesuccessofmcdonalds/8/1111/>.


Townsend, Matt. "Holiday Shopping: Retailers Aim to Thwart Online Rivals." BloombergBusinessweek. 01 Nov. 2012. <http://www.businessweek.com/articles/2012-11-01/holiday-shopping-retailers-aim-to-thwart-online-rivals>.


"Why do companies engage in corporate social responsibility?" The Economic Times. 13 Jan. 2014 <http://articles.economictimes.indiatimes.com/2013-06-21/news/40094605_1_rana-plaza-factory-ether-tex-building-safety>.


"Why The Retail Industry Can't Keep Up With Zara." Business Insider. 12 Jan. 2014 <http://www.businessinsider.com/zaras-genius-business-model-and-retail-2013-11>.


"Corporate Social Responsibility – Company – Google." Corporate Social Responsibility – Company – Google. 12 Jan. 2014 <http://www.google.cn/intl/en/about/company/responsibility/>.