International Business Research

INTERNATIONAL BUSINESSRESEARCHSource:Czinkota,M.,Ronkainen,I.,andMoffett,M.(1999).InternationalBusiness.FortWorth:TheDrydenPress.0ThesinglemostimportantcauseforfailureininternationalbusinessisinsufficientpreparationandinformationI -INTRODUCTION•Thefailureofmanagerstocomprehendculturaldisparities,thefailuretorememberthatcustomersdifferfromcountrytocountry,andthelackofinvestigationintowhetherornotamarketexistspriortomarketentryhasmadeinternationalbusinessariskactivity•Differencesbetweendomesticandinternationalresearch:a)newparameters(duties,foreigncurrencies,internationaldocumentation)b)newenvironmentalfactors(legalissues,culturalissues,politicalissues,technologicallevelofthesociety)c)Thenumberoffactorsinvolvedd)Broaderdefinitionofcompetition(muchgreatervarietyofcompetition)II -RECOGNIZING THE NEED FOR INTERNATIONAL RESEARCH•Lackofsensitivitytodifferencesinculture,consumertastes,andmarketdemands•Limitedappreciationfortheenvironment(Labourrules,distributionsystems,theavailabilityofmedia,oradvertisingregulations)•LackoffamiliaritywithnationalandinternationaldatasourcesandinabilitytouseinternationaldataonceobtainedResearchallowsmanagementtoidentifyanddevelopinternationalstrategies(identification,evaluation,andcomparisonofpotentialforeignbusinessopportunitiesandsubsequenttarget-marketselection)Researchisnecessaryforthedevelopmentofabusinessplanthatidentifiesalltherequirementsnecessaryformarketentry,marketpenetration,andexpansionResearchprovidesthefeedbackneededtofine-tunevariousbusinessactivitiesResearchcanprovidemanagementwithintelligencetohelpanticipateevents,takeappropriateaction,andadequatelyprepareforglobalchanges.III -DETERMINING RESEARCH OBJECTIVESObjectiveswillvarydependingontheviewsofmanagement,thecorporatemissionofthefirm,thefirm’slevelofinternationalization,anditscompetitivesituation.GoingInternational–Exporting;Cursoryofgeneralvariablesofacountry,includingtotalandpercapitaGNP,populationfigures.Thesedetailswillenabletheresearchertodeterminewhethercorporateobjectivesmightbemetinthemarket.NextStep,theresearcherwillrequireinformationoneachindividualcountryforapreliminaryevaluation.Third,selectionofappropriatemarketforin-depthevaluationFourth,acompetitiveassessmentneedstobemade,matchingmarketstocorporatestrengths,andprovidingananalysisofthebestpotentialforspecificofferingsIV -CONDUCTING SECONDARY RESEARCHTypicallytheinformationrequirementswillcoverbothmacroinformationaboutcountriesandtradeaswellasmicroinformationspecifictothefirmsactivitiesMostcriticalInternationalInformationforU.S.firms:A)Macrodata:tariffInformation,U.S.export/importdata,nontariffmeasures,foreignexport/importdata;anddataongovernmenttradepolicyB)MicroData:LocalLawsandRegulations,Sizeofthemarket,localstandardsandspecifications,distributionsystem,andcompetitiveactivity.c)SourcesofSecondaryData:US Government: Department of CommerceInternational Agencies: United Nations-UNCTAD, World Bank, IMFService Organizations: Banks, Accounting Firms, foreign Research firms, freight forwardersTrade Associations: American Chamber of CommerceDirectories and NewslettersDatabases: on-line interactive delivery, read-only memorySecondary data should be evaluated regarding the quality of their source, their recency, and their relevance to the task at hand. V -CONDUCTING PRIMARY RESEARCH Typicallyprimaryresearchintendstoanswersuchclear-cutquestionsas:Whatisoursalespotential,howskilledisthelabourforce,whatwillhappentodemandifweraisethepriceby10%?Whateffectwillanewtypeofpackaginghaveonoursales?DeterminingtheResearchTechnique:Selectionoftheresearchtechniquedependsonavarietyoffactors:¤Objectivityofdata,unstructureddata,datacollectedinrealworldorcontrolledenvironment,historicalfactsorinformationonfuturedevelopments¤Interviews¤Surveysmustpayattentiontoculturaldifferences¤FocusGroup(CollectiveInterviews)¤Observation¤EnvironmentScanning:necessityfortrackingdevelopmentsintheenvironment.Environmentalscanningactivitiesprovidecontinuousinformationonpolitical,social,andeconomicaffairsinternationally;onchangesofattitudesofpublicinstitutions;andprivatecitizens;andonpossibleupcomings.¤Typically, environmental scanning is designed primarily to aid the strategic-planning process rather than the tactical activities of the corporationDelphiStudies:Ameansforaggregatingtheinformationofagroupofexperts.Typically,DelphiStudiesarecarriedoutwithgroupsofabout30well-chosenparticipantswhopossessexpertiseinanareaofconcernsuchasfuturedevelopmentsoftheinternationaltradeenvironment.