IV S e n M.B.A. (Day)M Sem. M.B.A.

(Evening) Examination, JulyIAugust 2006

(Updated Scheme)
MANAGEMENT
4.1 :International Business
Time: 3 Hours Max. Marks: 75

SECTION - A

1. Answer any six from the following :

a) World Trade Organisations.
b) Explain the term 'Cultural Adoption'.
c) Strategic planning.
d) Spin-offbenefits.
e) Foreign direct investment.
f) International HR activities.
0)
b What are the major trading blocks ?
h) Social responsibility.
i) Explain the significance of international business.

SECTION - B

Answer any four questions from the following :

2. Why is international business a crucial venture ?

3. Explain the process of strategic management.
4. Explain various benefits of International Markets.
5 . What are the advantages and disadvantages of flexible exchange rate system ?

6. Examine the important elements in market entry strategy.

7. Briefly explain the Dominance of MNCs in International Trade.

- P.T.O.
 SECTION - C
Answer any three questions from the following :
8. Explain the comparative cost theory of international business. What are its
assumptions and outcomes ?
9. Discuss the factors like political and cultural influencing in international business.
10. What is international SWOT analysis ? How it is applicable in global strategies ?
11. Explain the significance of export promotion zones and special economic zones.
12. Explain the role of India in WTO and WTO's role in Indian socio-economic
development.
SECTION - D
Read the following case and answer the questions given below : (2x6112=

CASE
Once PepsiCo's venture was approved, Coca-Cola made an application to re-enter
the Indian market through production within an export processing zone. Producing
in this way would allow 25 percent of output to be sold within India rather than in
export markets. Tlus proposal threatened PepsiCo because the Coca-Cola name
was still well-remembered in India; cans of Coke were even smuggled in from
Nepal. But after sixteen months, Coca-Cola's application was denied, leading a
Coca-Cola official to say that India "doesn't follow its own rules".
In late 1989, a new Prime Minister, V.P. Singh, took power in a minority
government. As finance minister in the mid-1980s he had promoted liberalizing
FDI. However, after taking power, he almost immediately made conflicting
statements about such investment. In early 1990, the PepsiCo venture began
production of snack foods and announced that soft drink production would start
up by summer. Prime Minister Singh announced the government would
reexamine the PepsiCo agreement.
Several things then happened in quick succession. Because of India's strict FDI
regulations, the U.S. government, without public reference to PepsiCo, threatened
to impose trade sanctions against India under its Super 301 legislation. Indian
governmental officials and the joint venture's management then met secretly.
Subsequently, PepsiCo agreed to place a new logo, Lehar, above the Pepsi
insignia. It also lobbied publicly against Super 301 sanctions against India. The
U.S. government backed down. And India's Minister of Food Processing
Industries announced tax breaks for food processors.
In 1991, P.V. Narasimha Rao was elected Prime Minister and launched broad
economic changes, including a more welcome attitude toward FDI. A Foreign
Investment Promotion Board was established, and ownership requirements were
changed to allow 51-percent foreign ownership of companies. The new policies
gave confidence to foreign investors, and both IBM and Coca-Cola re-entered
the market. Coca-Cola announced its return in 1993 through a joint venture
with Parle Exports and agreed to export three times the value of its imports; it
also announced it would export plastic beverage cases to compensate for its
imports of concentrate. Three years later, Indian authorities approved a $700
nzillion expansion by Coca-Cola.
However, in 1995 political opponents of FDI garnered enough strength to cause
renegotiation of the Enron power project and to harass PepsiCo. A group of 400
militant protestors smashed Pepsi bottles and burned Pepsi posters. PepsiCo's
first Kentucky Fried Chicken (KFC) restaurant in Bangalore had to be protected
by police because of threats, and then it was closed temporarily because of
allegations of using too much monosodium glutamate, and because the chicken
industry diverts available land to meat instead of traditional food production.
KFC's second restaurant in New D e h was closed for a month because two flies
were found in its kitchen. Both PepsiCo's and Coca-Cola's sales were temporarily
suspended because prices on bottles were smudged.
Questions :
1) What behavioral factors might affect negotiations involving managers and
government officials from the United States and India ?
2) Describe the impact of socio-political and economic factors in the
development of beverage market in India.
 J

-
AE 1648
- IV Semester M.B.A. (Day)M Semester M.B.A. (Evening)
Examination, JulyfAugust 2005
(Updated Scheme)
MANAGEMENT (Paper.- 4.1)
International Business
Time: 3 Hours Max. Marks : 75
SECTION -A

1. Answer any six from the following: (6x2=12)

a) What is the theory of absolute advantage ?
b) For what two main reasons do companies go international ?
c) How does ethnocentricity distort one's is view of other cultures ?
d) What is totalitarianism ? What are its different forms ? Give examples of
countries where each form is in force.
e) Which principles of international law are more important for global
business ?
f) What are strategic alliances ? Comprehensive alliances ? Functional
alliances ?
g) What are the basic issues involved in hiring managers for foreign
assignments ?

It" h) What is translation exposure ? How can this be minirnised ?

SECTION -B
Answer any four from the following:

2. What is political risk ? Identity the types of political risks. How does each
affect international business ?

3. "International law is one of the environmental forces influencing international

business." Identify four areas of concern for an MNC in its interface with
international law.

4. You are the HR chief of a multi-million, and multiplant conglomerate. What

ethical issues do you face ? How do you manage them ?

5,. Do you think that WTO has been pro-rich ? Yes or no-discuss.

6 . Do regional trading blocks help or hurt world trade ? Discuss.

7. How do MNCs manage their current assets ?
 SECTION- C

Answer any three from the following: (3x10=

8. What is technology transfer ? How do host countries and home countries react
to techrology transfers ?

9. Are the four ps of international marketing of equal importance to all MNCs ?

What factors might cause some to be more or less important than others ?

10. State and explain the factors an MNC must consider while addressing the make
or buy decision.

11. Explzin the following, highlighting their merits and demerits.

a) Geographic area structure

b) Product organisation

12. Describe how MNCs formulate and implement their strategies.

SECTION - D (1~13=

I 13. Read the following: case and answer the auestions amended to it.
I Asian Values Under Fire

Many cultures in Asia are in the midst of an identity crisis. In effect, they are
being tom between two worlds. Pulling in one direction is a traditional value
system derived from agriculture based communities and extended families -
that is, elements of a culture in which relatives take care of one another and
state-run welfare systems are unnecessary. Pulling from the opposite direction
is a new set of values emerging from manufacturing-and finance-based
economies-elements of a culture in which workers must often move to faraway
cities to find work, sometimes leaving family members to fend for themselves.

For years, spectacular rates of economic growth elevated living standards in

many Asian countries far beyond what was thought possible in a few short
decades. Young people in countries like Malaysia and Thailand felt the lure of
Western brands. Gucci handbags, Harley-Davidson motorcycles, and other
global brand names became common symbols of success. Some parents even
encouraged brand-consciousness among their teenage children because it
signaled farnilywide success. Meanwhile, polls of young people showed them
holding steadfast to traditional values such as respect for family and group
harmony. Youth in Hong Kong, for example, overwhelmingly continued to
believe that parents should have much to say about how hard they study, about
how they treat family members and elders. and about their choice of friends.
But events took an unpleasant turn in the middle of 1997. The currencies of
Thailand, Indonesia, Malaysia, South Korea, and other nations crumbled.
Within weeks, currencies were worth about half as much as before and spending
power was sharply reduced. Financial investments throughout Southeast Asia
fled to safe havens in highly industrialized countries, and future investment
plans were either scaled back or put on hold. Some Asians blame the West for
the crippling economic crisis. Even more blame economic development and
"westernization" for a decaying value system and declining morality. Many
Asians, it seems, want modernization but also want to hold on to traditional
beliefs and values. They do not want Western companies and governments
imposing their ways of doing business on cultures that they might not fully
comprehend. Nevertheless, following the crisis, Western companies are
scooping up failing enterprises from Thailand to Japan and implementing
Western business practices.

Prior to the financial crisis, Asians thought they had discovered an "Asian"
way of doing business that was uniquely their own. Many respected analysts
in Asia, Europe, and the United States discussed the virtues of the so-called
"Asian model". But the crisis put an abrupt end to that discussion. Some
observers say that talk of an "Asian" way of doing business was overstated
and misplaced. They argue that belief in the importance of family became the
practice of nepotism, belief in the importance of relationships became cronyism,
belief in the building of consensus became corrupt politics, and belief in
conservatism and respect for authority became rigidity and an inability to
innovate. If Asian culture esteems family loyalty so highly, why was it
necessary for Singapore to enact legislation requiring that children take care
of elderly parents ?
Questions:
1. If your international firm were doing business in Asia, would you feel partly
responsible for these social trends ? Is there anything that your company
could do to ease the tensions being experienced by these cultures ? Be
specific.
2. In your opinion, is globalization among the causes of the increasing
incidence of divorce, crime, and drug abuse in Asia ? Why or why not ?
 IV Semester M.B.A. Examination, October 2004
(Updated Scheme)
MANAGEMENT (Paper - 4.1)
International Business

; Time : 3 Hours Max. Marks : 75

SECTION -A

h; Answer anv six from the following :-

. Give t,; lneaning of :
a) Barriers to trade.
b) Treaties and Converitions.
@ -

c) Core competencies'.
d) Two tiered pricing.
e) Transaction exposure.
f) Transfer pricing.
g) Tax haven.
h) Occupational culture.

SECTION - B
Answer any four from the following :

2. Bring out the arguments for protection of domestic firms.

" 3. How do MNCs assess political risks ? How do they manage such risks ?
t".
t". 4. Name the important legal systems prevailing around tht: wulid. Zring out the
implications of each on in~erliationalbusiness.

5. Bring out the reactions of llost countrjl m d of home country to technology

• transfers.

a 6. Why do ctratecgic alliances hi1 ? How do you manage them effectively ?

6
7. What are the rriost importar~tcriteria nlultinationals should use when selecting
expatriates ?
t

-
. 3

?
 SECTION - C
Answer any tnree from the following :

8. Bring out the drivers of international business. 6

9. Bring out the advantages and disadvantages of employing PCNs, HCNs and - %
TCNs.
' C
10. Explain the main straregic issues in global operations management. '%
11. Bring out the arguments for and against social responsibility by MNCs. What
challenges does a n MNC face while undertaking social actions ?

12. Explain the dif'l'crent routes of globalisation.

SECTION - D (1x13=13) %
Assuming yo11are all international manager, offer your comments on the following h
situations : 'Ci
It is argued that nations use trade policy to pressurise other countries to change
certain policies. For example, countries have limited trade with Iraq to weaken
its repres>i\-t.cii~tatorship;with India to protest its nuclear tests ;with Malaysia
so that ~t will prohibit the abuse of child labour ; with Taiwan so that it will
curtail trade in enda11ge1-edanimals ; and with Brazil so that it will restrict the
cutting of Amazon fol-ests.

Acme Boots a~inouncedit was moving out of the U.S: to gain tax advantages
in Puerto Rico. The move stranded its U.S. employees, some of whom had
30 years of service with the company. Many critics of FDI argue that it is
unethical for gavel-nments to lure companies away from existing locations by
offerin? lucrative incentives and for companies to move.

3. A firm enters into a contract to sell drilling equipment to a Korean company.

The ,ontract is closed while the Korean company president is visiting the
'c
U.S. plant. Aftei- closing, the Korean executive points out that all imports to %
Korea musr be channelled through a registered "local agent". He quickly 'C
suggests that a wholly owned trading company tha.t he owns could handle all
of the paperwork - for a fee. h
 I V Sem. MUA (Day) Degree Examination, Sept/Oct. 2003 I

MANAGEMENT (,Pager - 4.1.)

-- . -
International Business
1 I)~L. t ki,;un Max. Marks: 50

SECTION - A
~ 1 1 lllrce
,':~!<;v~cr 1 ~ Froln-thisSsction. Encllquestion carries two marks.
clueslio~~s :' '(3x2 = 6)
.I) %'hat a1.c expenses curve benefits ?
!I) V4har is internationill divisionstructure ?
. What is inlerna~ic.)naloperatiorls management ?
(1) What is technology transfer ?
-4

C) W h a ~is balance shcet approach to export co~npensation?

SECTION -- B
any three questions from this Section.Eacllquestion carries five marks.
:::-:\u- (3x5 = 15)
L. "Many international alliances end up in failure" Give your view point.
. Uring oul the impact of cross-culture on international business. . .

:*

4. Iiow 30 in~crnatiomlbusiness seek to minimise foreign ctchange risks ?:

. . , .
...,.. ,
.
.

L>oregional Lrading blocks help or hurt world trzde ? , I !I .

', 1 ',
s I .

I,, Arc Lhc four P o f intcrnntional marketing of equal i ~ n i o h n c e ' l all

o Arms.?

SECTION - C
Answer a n y two clueslions from this Section. Each question carries eight marks. (2x8 = 16)
7 Explain the international business environment.

Describe the i~iternationalslrategic management process.

9. State and explain the strategic issues involved in international operations management.

1 . ' ~ Y h yd o expor.t f;lilurcr: occbrs 7 How can such failures be rnininlised ?

SECTION -- D \

(-.'ax: (1x13 = 13)

1)estination India ?
~ . ~~

llldia is located i n southcri~ Asia, with the Bay of Benga! on the east and the Arabian Sea
on [lie west. One -sixth of thc world's population (approximately 1 billion people:; lives
witllin t h e c i ) \ l ~ l t r1.27
~ ' ~~rlillionsquare miles. Over 80 percent of Uie populatiun are
I.iind~is,a ~ l t l(11col'fici;tl I;lnguagc is I-lindi, nltliaugh many people :.lso !;peak English.
L3ccacsc L ~ I li[e~;tcy
C mtc is lcss lhzln 40 percent, radici and television a1.c tbc most influentid
,,ledia. 'rhc country ol)criiLcs as a dcmocra~icrepu ~ l i carid , for the nl,i,s[ ;,an, onc party
ha:; domi~iatcdthe governl.nent since indepeudeuce in 1947.At :hat tir,::, India was born
 ,,
,., +L,. .
.,,,
-..A:+:--
s f t?; f~r;;;zr Erkish Indian empire into the iiew coiint I t a uiirruia and
Pakistan. f i s division has been a source of many problems through the years. For
example, much to the dismay of the world community, both countries had nucle.ar tests
in a cold war atmosphere. Also, many millions of Indians stilllive at the lowest level of
subsistence, and de per-capita income is very low.
In the p a t , doing business in India has been quite difficult. For example, i t took PcpsiCo
3 years just to set up a soft drink concentrate factory, and Gillerie, ~ h U.S.
c razor !?:udc
company, had to wait 8 years for its application to enter the marker to be acczpied.
Additionally, many MNCs have complined that there are too many barriers to effective
operations. In the mid-1970s, the country changed its rules and required that foreign
partners hold no mare than 40 percent ownership in any business. As a rcsull, some
MNCs left India.
In recent years, the government has been relaxing its bureaucratic rules, pcmicularly
those relating to foreign investments. From 198 1 to 199 1, total foreign dircct invcs~ment
in Lndia increased by $250 million, and betvteen 1991 and 1993,itjumped by an additional
$2.5 billion. In 2000foreign direct investment was over S3 billion and thc pace continues.
Most of this new investment has come from the United States and nonresident ~ndinns.
One reason for this change in the nation's policies toward business is that the government
realizes many MNCs are making a critical choice: India or China ? Any morlies not
invested in India may be lost to China forever. Additiunally, i l can be scen that toreign
investments are having a very positive effect on the Tndian economy. After thc liisr big
year of new investments (1991), India's annual GDP jumped to over 4 percenr. I n 2000
annual GDP increased by more than 5 percent.
The relaxation of rules definitely has encouraged more foreign investment. Coca-Cola
. ~.
was able-togetplission fora 100-percent-owncd unit in India in 8 wccks, and Mntorol3
received clearance in 2 days to add a new Froduct line - and did all of this via fax.Othcr
companies that have reported rapid progress include DaimlerChry'sler, Procler & Ganihlc,
and Whirlpool.At the same time, however, not everything is roses. Many MNCs are still
reporting problems.
Nevertheless, the Indian goven~ment'snew approach is Ilclping a grcaL dcd. In addirion,
there are other attractions that entice MNCs to India. These include: (1) a large number
of highly educated people, especially in critically short supply areas such as in rncdicinc,
engineering and compute~~science; (2) widespread use of English, long accepted as the
international language of business; and (3) low wages &ld salaries, which often arc 10 to
30 percent of th,ose in the world's economic superpoivers.
Questions:

1. What is the climate for doing busines: in India ? Is it supportive of foreign investmen! ?

2. How important is a highly educaled human resource pool for MNCs wanL!nC to
invest in India ? Is it more important for some hnsiness than for ~ t h e r ?s

3. Given the low per-capita income of the country, why would you still argue Lor !>&a
to be an excellent place to do business i n the coming years ?
 -- -

'
-- ,
--

El: -. "/ /
" '
< - C >
i .CS .-
-. - AE-2104
4

M.B.A. IV Semester (Day) Examination, September/October 2002

(Semester Scheme) a

MANAGEMENT C4 1) a /

Internatiolial Business
\

F Timc : 2 Hours Max. Marks : 50

e" SECTION - A
ti3 Answer any three cluc5tions from this Section. Each question carries two marks: (3x2=6)

1. a) What is cross-cultural management ?

I
!

b) ~ l i a ist reverse culture shock ?

c) What is transaction exposure ?
d) What is shared management agreement in a strategic alliance ?
e) What is tax-equalisation system ?

SECTION - B

Answcr any three questions from this section. Each question carries five marks. (3x5=15)

2 In what ways d&s domestic HRM differ from international HRM ?

p- -) 3. Why do MNCs engage in currency netting operations ?

p
i 4. How does operations management offer competitive advantage to an MNC ?
u-2
5 . What are the advantages and disadvantages of different pricing policies ? Why do most
inlcrrlrltional firms use market pricing ?

6. Do nlanugcrs of intcrwtionnl firms need Lo approach organisation design differently

kom their counter parts in domestic firms 7 Why or why not 7

SECTION - C

Answer any two questions from this Section. Each question carries eight marks. (2x8=16)

7. What are the rclative advantages and disadvantages ofjoint ventures compared to other
typcs of strategic alliance?

8. How dc the theories of absolute advantage and comparative advantage differ from each
other ?

P.T.O.
---. -- ..
. .. - ~ . .. -..-- -
 I

AE - 2104 -2-
9. l~,:hzt2ze the h?cir reasons forthe recent growth of international business :~clivity ?

10. What &e the main advantages and disadvantages of the ethnocentl-ic. polycentric and
geocentric approaches to staffing policy ? When is each zpproach appropriate ?

SECTION - D

CASE
McDonald's Global HR
One of the bcst-known companies worldwide is McDonald's co~por.ation.13::: f~7:-
food chain, with its symbol of thegolden arches, has spl.cacl from thc C!rlitccl S ~ L I Li : C
i r c -L
, ,

9 I countries. With over 18,000 restaurants worldwide, McDonaltl's scrvcs 33 11;; i i i o n

~ ) c ~ >c:lch
p l c d:ly. Intcrnationnl salcs arc an i~nportuntIX\I-I o f McDo~i;\Icl':;Ix~si~lc,\,.
:1ri(1

over 50% of thc company's operating income rcsults rro~nsalcs oucsitlc tllc I'!l~:ccl
S tntes. ?i, generate these sales, McDonald's ernploys ovcr onc mill iol.1 pcol,lc, ; t n ~ !h y
2000, McDonald's had grown to over two million employees.
. .
-- Operating 111~50inany different countries mean that McDonald's has had to nda[>t its
prod~lcts,scrviccs and 1-11< prircriccs 10 Icgal, polirical, cconolnic alitl c~~ilur:\l
I;~c.cc) r I 11
4

each one of those countries, few examples illustrate how adaptations have been made.
In some countries, such as India, beef is not acceptable as a food to a major part o l the
population so McDonald's uses lamb or mutton. 10appeal Japxiese customsrs.
McDonald's has dcvcloped teriyaki burgers. Separate dining rooms for men and \\ amen
have been constructed in McDonald's restaurants in some Middle Easiekn coilntnes.
E-IR practices also have had to be adapted. Before beginning oper2qtion.s in a difiergnt
country, HR professionals at M c ~ o n a l d ' sresearch the country and determine h o u HI?
iicrivities niust be adjusted. One method of obtaining inforrnatiorr is to c o n t x : H R
professionals from other U.S. firriis operating in the couritry and ask them quesiions
about laws, political factors, and cultural issues. In addition, the fum conducts an anzljrsis
using a detailed outline to ensure that all relevant information has been gathered. Data
gathered might include what employment restrictions exist on ages 01 employees and
hours of work, what benefits niust be offered to full-tiin,: and part-!imc cmp1oyct.s ( i f
part-time work is allowed), and other operational requirements. For ir~s!ancc,in son~t'o f
the former communist countries in Eastern Europe, employers proviclc Inckt:r roonls.
and showers for their employees. These facilities are ncccssary becausc shower f;~ci!Ilies,
and even consistent water supplies, are unavailable in many homes, particularly ;i. :;:,re
rural areas around major cities. Also, public t r h n s p ~ tion
~ a must be e\.aluaied to e.1I ire
that employees have adequate means to travel to work.
Once a decision has been madero begin operations in a new couctry, the emplo! ment
process must begin. Often, McDonaid's is seen as a desirable employer, particu!arly
when its first restaurant is being opened in a countly. For instance, in Kussia, 27.000
people initially applied to work at the first Moscow McDonald's, which currently has
over 1,500 employees. Because customer service is so important to P~lcDc;;?~iiil's,
recruiting and selection aclivities Ccrcus on obtaining cmployccs wilt.) custolnc:: ;;cr\.icc
skills. Or warkcr positions such as cc~ll~~tcl. ~.cprcscrlt;rl
i vc : ~ r ~c:rsllicr.,
tl t i !cI c)ii.~..I:, lo
identify individuals who will be friendly, customer-sei-;.ice--orienteden.ipli,jy~c~. :? ..rri;:l"
process whereby some applicants work for a few days 011 a contii~ionaibasis :-I;,:!, bc
used to ensure that thes? iildivitluals will represent McDo~lald'sappi-opri;l!ely and will
Work well with other employees.
 For store k.nagers, thc: coln;xrlly uses a sclectiori profile ernpl~asizingleadership skil!s.
Irigh work exvcc~.iiions,;incl ~;iiiil;\gf;.m~nt abilities :!.~;prop!.iati:tn r! kist...;)acedreslaurint
e~~vironmcnt. (3ilci.1.ii;;:l!cc:;.I si:;-ceningS ; I ~int?r;i~xshtivc Sec;:~c:,n~pie.ted,irldividua!~
are asked to ureskfor cp to i: week in a restaurant. .During that h e . , bolh the applicants
slid the comlmny rcprcscritativcs evali~alcone ar~olhcrto see if thcjob "fit", is nppropriatc.
AI'lcr. thc Iirst groi1p ol'storc managers and &sist:ult nlarlagers are sclccted. h~ture!nanag:-rs
and assistant 1nall:igcr:; are choscn using irlternal promotions bascd on job performance.
Once the rcstaurarrts arc stal'cccd. training bzcornes crncial to acquaint new employees
, .
with their jobs ; t ~ i c i the MclXXil.?i's ptiilosoptiy o f c u s t o m - e r n a n d cluality-------
Mcl)o~~;~lcl's 1 1 ~t:lkcrr
s ils I Ia~~il)irl.gc~. Univcrsily curric~~lum from [hc U~iitcdStrltes all(;
~r;irisI;~rctl i t inlo '22tlifferenr languages to use iu mining centers througllout the world.
( ) I I L . C * I I . : I ~ I I I I ~ ; : 11;~s !)CCII I C V Slll~\ll:lgC~~S,
( 1 0 1 1 ~~ . < ) I L [ I ' ~ I ~ I iLIl(I C ( > I ~ C ~ ~trili~iirig
[ I l C y 111~11 IC[ !.Or
aii e!!ipioyees st:lected LC work al McDonald's locations in the foreign counti-ies. .
. Questions :
1 . Identifjl cu1tur:~lfactors that might be important in a & m g program for food handlers
at McDonald's in Saudi Arabia.
2. Rati~crthan fc~cusingon ttie differences. what similarities do you expect exist among
hlcDonald's casio1i1ersand err~ployeesin both the United States and abroad ?
 I IV Sem. M.B.A. (Day) & V I Sem. M.B.A. (Eve.) Examination, %pt./Oct. 2001
(Semester Scheme)
,e 4.1: INTERNATIONAL BUSINESS
Time: 2 Hours Max. Marks: 50
SECTION - A
I
Answer any three questions. Each question carries 2 marks. (3x2 = 6 )

1. a) State the characteristics of a transnational corporation.

b
b) What is strategic alliance ?
c) State the barriers to international business.
I
p d) State the objectives of World Trade Organisation.
e) What is International Strategic Management ?
SECTION - B
Answer any three questions.
. 2. Naine the routes of globalisation. Which is ideal ?
3. What is culture 7 Explain the impact of culture on global business.
4. Discuss the impact of informatian technology on global production operation.
5. Describe the process of international strategic management.
6. How might an MNC minimise its foreign exchange risk ?

SECTION - C
Answer any two questions.

b- 7. What are the drivers of international business ?

p, 8. How do the variations in foreign exchange rates affect global business transactions ?

h- 9. How docs international business differ from d ~ m e s t i cbusiness ? Who are the major
players in global business ?
p-
I 10. Evaluate international division structure and geographic area structure.
t- SECTION - D
Case ~ n a l ~ & s :

h- Organizational Change at U ~ l e v e r
Unilever is a very old multinational with worldwide operations in the detergent and
food industries. For decades, Unilever managed its worldwide cietergenw activities in
an arm's-length manner. A subsidiary was set up in each major k t i o n a l market and
allowed to operate largely autonomously, with each subsidiary carrying out tile fu!!
range of value creation activities, including manufacturing, marketing, and R&D. The
company had 17 autonomous national operaiions in Europe alone by the mid-1980s.
 AE - 1985
In the 1990s, Unilever began to transform its worldwide detergents activities from a
ioose confederation into a tightly managed business with a global strategy. The shift
was prompted by Unilever's realization that its traditional way of doing business was
no longer effective in an arena where it had become essential to realize substantial cost
economies, to innovate, and to respond quickly to changing market trends.
The point was driven home in the 1980s when the company's archrival, Procter &
Gamble, repeatedly stole the lead in bringing new products to market. Within Unilever,
"persuading" the 17 European operations to adopt new products could take four to five
years. In addition, Unilever was handicapped by a high-cost structure fr3m the
duplication of manufacturing facilities from country to country'and by the company's
inability to enjoy the same kind of scale economies as P&G. Unilever's high costs
ruled out its use of competitive pricing.
To change this situation, Unilever established product divisions to coordinate regional
operations. The 17 European companies now report directly to Lever Europe. Implicit
in this new approach is a bargain: The 17 companies are relinquishing autonomy in
their traditional markets in exchange for opportunities to help develop and execute a
unified pan-European strategy.
As a consequence of these changes, manufacturing is now being rationalized, with
detergent production for the European market concentrated in a few key locations.
The nu~nberof European plants manufacturing soap has been cut from 10 to 2, and
some new products will be manufactured at only one site. Pmduct sizing and packaging
are being harmonized to cut purchasing costs and to pave the way for unified pan-
European advertising. By taking these steps, Unilever estimates it may save as much as
$400 million a year in its European operations.
Lever Europe is attempting to speed its development of new products and to synchronize
the launch of new products throughout Europe. Its efforts seem to be paying off: A
I dishwasher detergent introduced in Germany in the early 1990s was available across
Europe a year later - a distinct improvement.
I

But history still imposes constraints. Procter & Gamble's leading laundry detergent
carries the same brand name across Europe, but Unilever sells its product under a
variety of names. The company has no plans to change this. Having spent 100 years
building these brand names, it believes it would be foolish to scrap them in the interest
of pan- European standardization.

Case Discussion Questions

1. What strategy was Unilever pursuing before its early 1990s reorgmiztioc? What
kind of structure did the compmy have ? Were Ucilever's strategy and structure
consistent with each other ? What were the beneEcd of h i s strategy and structure ?
What were the drawbacks ?
2. By the 1990s, was there still a fit between Unilevcr's strategy and structure and the
operating environment in which it competed ? If not, why not ?
. 3. What kind of strategy and structure did Unilever adopt in the 1990s ? Is this
appropriate gi-(en the environment in which Unilever now competes ? What are the
becefits of this nrganizational and strategic shift ? What are the costs ?
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t" i: 3 M.B.A. ILV Seme::ter Exanlination, Novernber/Decernber 200C)

r3 (New Scheme)
1 MANAGEMENrI'
I " 4.1 International Ijusiness
I !
'9 Time: 2Hours hlax. Marks: 50
SECTION - /\

Answer all the questions. Each q;lestion carrics 1mark.

1, a) Ualnncc ol' Lrndc and bul:~rlccor paynlcnl arc
(one and the sanlc/diI'Fcscn~)
b) Elaborale the abbrevialiorl G K I T
c) Globalisation arid libcralisalion are
(one and sameldiffcrent)
d) Basic objective of Inlernationa! Monetary Fund is
~~~ .-.. -- .

e) E,thino-entric approacll tncans -- --

SECTION - D
ny three of the following not excceding 15 lines. EI:!.!,;!:!.%stion
carries
( 3 x 5 =15)
2. Wrilc t!le cornpolren~soC inlcrrlaLio~lalbusincss cnvison~ilc~ii.
3. Explain [hc signil'ic;lncc or !)alil~iccof paytncrll i n i~~~crnrltionnl
business.
4. What al-e the objectives of WTO? How it is administered?
J approach is u.cx:ful in inkrrlational sccruitmcnl of hurnau rcsourccs?
5 . How is erhino-en~~ic

2 1 6. Write the impact of libcraiisation of Indian economy on internationaIisation of Indian

ON - (2
SI~<CTI
Answer uny th1-w out oC wllich qucs~ionnunlhcr 11 is con~pulsory.Endl qucstiun carries
( 3 x 10 ~ 3 0 )

3 7. H o w d o cultural, cconomic ;ind political fncti>rsal'fccr Lhc cnviro!lmenl of :ntcrnaLional

busir~c.ss'?
8. Wllal are the lasil'r arid nor1 lasil'l barriers for- an inlcrnalional busitlcss'? Why ilid non
lariff bur-icrs bccalue rnorc irnporliu~tin rcccnt ycilrs?

3 9. Whar u c [he causes I'or foreign c x c h a ~ g crisk? 1-low !c. over corn(! S I ) C ~ ~ ' I < ? ; ~ S ' . ;

3 10. Criscaliy evaluntc any LCII t11co1-ics

or i.ntcrnnr.iona1Lr;!dc.

3 1 1 . I-low r~lill~inaiio~lal
I'irnls c v a l ~ ~La~lI ~C O L I ~ U . ~ CSol.
. S dccidinp. to cn11-yinto tI,,~sc
col~nrrics'll*hcway or ll~circvi\l~iilt.io~~ i:p~)~-c.;p~.ia[(: ~ I 1I11.cir,!i:l.cs[ o!'~lcvclo~ir~g
counuics.I'oin1 out L ~ limi!atir;:ls
C ill the coi~r:lrycval!:arion mr:!!i:)iI:; :~rIor)l~(f hv hfNr h
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