Factors That Affect the Failure of Business Management At The International Level

Document Type:Dissertation

Subject Area:Engineering

Document 1

This paper, therefore, will discuss the factors which cause international business management failure. It will describe Nokia company as a failed case and Burberry Company as a success case. Also, a compilation of reviews from online sources has been done to back this research. Data collection will be done by both phone conversation and from online credible data sources. A conclusion will then be made based on these data. The available researchers are again not conclusive on the matter (Numella et al. Apparently, there is no doubt that such young rapidly internationalizing firms do operate in competitive and challenging environments with their meager resources. Recently the consensus had that International New Ventures (INVs) suffer and records highest rates of failures. The liabilities that the International New Ventures experiences are in fact expected to increase high rates of failure.

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There have been different opinions, however, regarding the success or the collapse of the International New Ventures. Failure of foreign new investments has been given less attention. This surprising analysis of the survival of the firms creates a gap where lessons that would be learned from the failure have a severe impact on the formulation of the policies that can support such enterprises. As a result, the level of understanding among the scholars is quite limited, and even fundamental questions on the issue the survival of INVs cannot efficiently be answered (Nummela et al. , 2) This study is therefore crucial as it tries to efficiently analyze the failure of the businesses in international level since the available research have placed great emphasis on the success and growth of the companies only, neglecting the other side of the coin; which is the reasons for failure.

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Literature review The definition and terminologies used to of business failure vary depending on the context. Cause of failures emanates from the external environment in which the business operations or internal elements within the market. Some of these causes of business failures cannot be predicted while others can be predicted in advance and therefore avoided. In most cases, those that can be predicted in advance with the intention to prevent them are internal factors. External factors, however, are quite difficult to predict, and unfortunately cannot be prevented (Atsanª 1) Several specific factors can affect the achievement of global business. There are however a few common factors that are evident in companies that endeavor to operate beyond their national borders and fail. Companies that fail to hire local talent do not record much success.

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Management plays a crucial role in the performance of every business. Managing a business involves quite a lot of activities that include planning, organizing the factors of production and operations, Controlling and directing as well. Communication is also part of the management activity that is considered crucial in the performance of any business venture whether operating within the domestic boundary or the international boundaries (Olsen 1) Knowing how this factor dramatically affects the performance of the business is crucial in this research project since it will point out the need of doing proper managing in the industry to avoid failure. Since this is an internal factor, an adequate explanation of how this factor can lead to the success or failure of the business can be avoided with proper strategies that can be put in place by having efficient management in international markets.

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This led to the most crucial members of the management to leave the company, and new middle-level executive didn't have the necessary experience to gear the company forward. The top management did have sufficient technological strategy to set priorities and provide a solution to the arising matrix. Its product differentiation didn't work either (Doz, 1). Nokia’s weak brands could also be the major cause of its failure. Its rival companies such as Apple have been competing to understand the need of the consumer in terms of brands. The company handed over its 24 chains to the local coffee peddler that had only around 7-11 outlets (Seale 1) The environment in which the business is done plays a vital role in the failure or the success of the company.

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The business environment is a collection of various external factors that affect the operation of the business. These factors include the economic, the social, legal, the technology available and the political considerations. All these external factors collectively affect the operations and the performance of the business. It is critical that every business venture to not only interact with the environment it operates but also transact with it since there is a direct relationship between the two. The Burberry Company, for example, was able to rake in profits due to increase in demand for prestigious products in the Japanese and the American Market. The social environment, on the other hand, is the sociological factor that surrounds the business. People's culture, for instance, can dictate what the company can offer in the market.

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Fashion products are based on the social status of the people. This factor can increase demand or reduce it, and thus can affect the performance of the business (Vessels 1) Failure to understand both internal and external business environment carry out proper communication and proper planning can lead to failure of the business since the business has limited control over the context in which it operates. Finally, the study offers possible strategies that can be used to improve the performance of business management in international level. It will be assumed that the respondents will be objective when filling in questionnaires and answering telephone calls. It is also considered that they will cooperate and that the environment will be favorable to carry out the exercise.

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It is assumed that there will be political goodwill in selected countries in which this study will be conducted The method of data collection was from phone interviews since it would provide additional first-hand information as the business managers would get to understand the questions better. Other information will be obtained from the business websites and credible data collection websites. To obtain a final report, we shall also look at a case of a successful company such as Burberry Company a UK manufacturer and distributor of accessory products. As data will be collected from phone interviews and credible website sources, the decision making will be authentic as the respondents will increase the credibility of the information Work plan Data collection will take at least a month and, and analysis will make another one month.

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Writing of the research paper will take at least two months to complete. Task Week or date or month Forming questionnaires and Data collection both interviews and online research Literature Review Data interpretation and analysis Submitting the research paper Ethical issues Ethical consideration will be taken seriously while undertaking the study. The views of the respondents will be treated with the highest level of confidentiality and will never be disclosed without the permission of the respondents. Local institutions will be used to obtain data to avoid the problem of misinformation that can occur from awarding practical value to a parameter that has contextual meaning. Contextual explanation of the settings will also be done to obtain accurate information. For this research, face to face interview with the above-mentioned companies is not possible.

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Therefore, phone interview and online sources will be used. The phone interviews may not give trustworthy and detailed information as one is not able to illustrate the questions through a phone conversation. Conclusion It is imperative to know the factors which cause international business management because it will help the future entrepreneurs to avoid the same mistake when undertaking new ventures internationally. It is imperative to note that good leadership and management is vital for an international experiment to succeed. Sober, well-developed decisions lead to successful business venture on the global perspective. Among other factors also, proper planning and communication network are crucial. It is also important to know that it is from researching the reasons why some companies fail in the international business management while others get successful.

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