Tag: organisation of commerce and management

Global enterprises are characterized by having highly sophisticated research and development departments engaged in the task of developing new products and superior designs for existing products.

Aggressive Market. A market or exchange with a high trading volume. When a market becomes very aggressive, the prices of stocks can go up significantly, which in turn makes it more expensive for a trader to become involved in the market by buying stocks.

Global enterprises does not have any problem in market penetration  because their operations and activities extend beyond the physical boundaries of their own countries. 

Global enterprises have their headquarters in their home country and exercise control over all branches and subsidiaries. This control is limited to the broad policy framework of the parent company.

A restrictive clause is a clause which functions as an adjective to identify the word it modifies. A restrictive clause is essential for the intended meaning. A restrictive clause is not offset with commas.

The globally integrated enterprise is a term coined in 2006 by Sam Palmisano, the then CEO of IBM corporation.

MNC has many disadvantages. It invest in most profitable sectors and disregard the national goals and priorities of the host country. Many domestic industries have to wind up due to the threat of MNC'S. 

Foreign exchange transaction is a type of currency transaction that involves two countries. Generally, a foreign exchange transaction involves conversion of currency of one country with that of another. The conversion of currency in a foreign exchange transaction can be performed.

Home Country in international compensation, this is the country upon which an expatriate's compensation is based. It is usually the expatriate's home country or the country in which the employee's headquarters is located.

Multinational Corporations in developing countries

• Environmental costs. Multinational companies can outsource parts of the production process to developing economies with weaker environmental legislation. For example, there is a trade in rubbish, which gets sent to developing economies like India for disposal and recycling.
• Profit repatriated. Although multinationals invest in developing economies, the profit is reptriated to the location of the multinational, so the net capital inflows are less than they seem.
• Skilled labour. When undertaking new projects, the multinational may have to employ skilled labour from other economies and not the developing economy. This means best jobs are not received by local workers and the investment is diffused.
• Raw materials. A large component of multinational investment in developing economies is seeking out raw materials – oil, diamonds, rubber and precious metals. The extraction of raw materials can cause environmental externalities – polluted rivers, loss of natural landscape.
• Sweat-shop labour. Not all economists are convinced sweat-shop labour is a good thing. Critics argue that weak labour conditions allow multinationals to use their monopsony power and pay lower wages to workers than they should get paid