INTERNATIONAL BUSINESS STRATEGIES

Andrey G. Medvedev,Professor

September 7, 2009

MIM Programme

© Andrey Medvedev

INTERNATIONAL BUSINESS STRATEGY

PLAN OF THE COURSEPLAN OF THE COURSE1.1. GLOBALISATION AND MULTINATIONAL COMPANIES

2.2. INTERNATIONAL STRATEGIC MANAGEMENT

3.3. GLOBAL–LOCAL DILEMMA

4.4. NON-INVESTMENT FOREIGN OPERATION MODES

5.5. INVESTMENT FOREIGN OPERATION MODES

6.6. INTERNATIONAL STRATEGIC ALLIANCES

7.7. INTERNATIONAL ORGANISATION DESIGN AND CONTROL

8.8. THE SUBSIDIARY-LEVEL STRATEGY

9.9. INTERNATIONAL OPERATIONS STRATEGY

10.10. REPORT PRESENTATIONS

11.11. INTERNATIONAL FUNCTIONAL STRATEGIES. CONCLUSIONS

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PHILOSOPHY OF THE COURSE

OUTWARDOUTWARD INTERNATIONAL BUSINESS– AN AMERICAN APPROACH

INWARDINWARD INTERNATIONAL BUSINESS– GSOM APPROACH

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READINGS

RECOMMENDED TEXTRECOMMENDED TEXT– Hill C. W. L. International Business,

6th ed. 2007.– Lasserre P. Global Strategic

Management, 2nd ed. 2007.

ADDITIONAL READINGADDITIONAL READING– Bartlett Ch. A., Ghoshal S.,

Birkinshaw J. Transnational management: text, cases, and readings in cross-border management, 5th ed. 2008.

CASE COLLECTIONCASE COLLECTION

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COURSE ASSESSMENT

IN-CLASS ACTIVITY (10 PERCENT)IN-CLASS ACTIVITY (10 PERCENT)– TEAM CASE ANALYSIS AND DISCUSSIONS

• STRATEGY, OD, FDI MODE SELECTION, COMPARISONS OF FOMs

MIMI-STUDIES AND IN-CLASS TESTSMIMI-STUDIES AND IN-CLASS TESTS (20 PERCENT)(20 PERCENT)– MNC PRESENTATIONS (IN GROUPS OF TWO)

– MICRO-TESTS

GROUP PROJECT REPORT (20 PERCENT)GROUP PROJECT REPORT (20 PERCENT)– INTERNATIONAL CASE ANALYSIS

WRITTEN REPORT AND ORAL PRESENTATION

EXAMINATION (50 PERCENT)EXAMINATION (50 PERCENT)– WRITTEN TEST

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1. GLOBALISATIONAND MULTINATIONAL COMPANIES

1. THE NATURE OF INTERNATIONAL BUSINESS

2. MODEL FOR ANALYSIS OF FOREIGN ENTRY

3. INTERNATIONAL BUSINESS ENVIRONMENT

4. TYPOLOGY OF CROSS-BORDER OPERATIONS

5. MULTINATIONAL CORPORATIONS

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GLOBALISATION IS A MEGA TRENDGLOBALISATION IS A MEGA TREND,

AND IT WILL PREVAILBASED ON ITS KEY DRIVERS:

TECHNICAL PROGRESS,

POLITICS AND ECONOMICS

Dr. Ulrich Lehner,

President and СЕО, Henkel KGaA

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THE NATURE OF INTERNATIONAL BUSINESS

DOMESTIC VS. INTERNATIONAL BUSINESS

MOTIVES FOR INTERNATIONALISATIONMOTIVES FOR INTERNATIONALISATION– PROACTIVE MOTIVES

– REACTIVE MOTIVES

BARRIERS TO INTERNATIONAL BUSINESSBARRIERS TO INTERNATIONAL BUSINESS– EXTERNAL ENVIRONMENT

– MANAGERIAL BARRIERS

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IMPORTANCE OF INTERNATIONALBUSINESS Despite being the world’s largest beer producer,

Anheuser-BuschAnheuser-Busch relies on the U.S. market for most of its sales. Foreign markets account for only 16 percent of its revenue.

The fourth biggest beer company in the world, Heineken NVHeineken NVowns 115 breweries in 65 countries. The home marketof the Netherlands accounts for only 14 percent of Heineken’s sales.

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GLOBALISATION

GLOBALISATIONGLOBALISATION– THE SHIFT TOWARDS A MORE INTEGRATED

AND INTERDEPENDENT WORLD ECONOMY THE GLOBALISATION OF MARKETSTHE GLOBALISATION OF MARKETS

– THE MERGING OF HISTORICALLY DISTINCTAND SEPARATE NATIONAL MARKETSINTO ONE HUGE GLOBAL MARKETPLACE

– GILLETTEGILLETTE IN 120 COUNTRIES THE GLOBALISATION OF PRODUCTIONTHE GLOBALISATION OF PRODUCTION

– THE TENDENCY AMONG FIRMS TO SOURCE GOODSAND SERVICES FROM LOCATIONSAROUND THE GLOBE TO TAKE ADVANTAGEOF NATIONAL DIFFERENCES IN THE COSTAND QUALITY OF FACTORS OF PRODUCTION

– GILLETTEGILLETTE IN 20 COUNTRIES

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FOREIGN ENTRY: A MODEL FOR ANALYSIS

CompetenceCompetences, values, s, values,

overall overall strategy & strategy &

ODOD

entry mode; entry mode; entry-mix; entry-mix; entry entry stagesstages

PEST-factors PEST-factors of of

opportunities opportunities and threatsand threats

Implementation

Goals of internationalisation

Development (real option)

Industry (SBA) Industry (SBA) / product / product

nature (multi-nature (multi-domestic vs. domestic vs.

global)global)

Current performance

Reasons to internationalise

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REASONS TO INTERNATIONALISE: WHY?

UNSATISFACTORY CURRENT PERFORMANCEUNSATISFACTORY CURRENT PERFORMANCEIN COUNTRIES OF EXISTING OPERATIONSIN COUNTRIES OF EXISTING OPERATIONSBECAUSE OF

– SLOW ECONOMIC DEVELOPMENT– UNATTRACTIVE REGULATION– HIGH BUSINESS RISKS, COMPETITION– SATURATED MARKETS, LOW DEMAND– LOW EFFICIENCY, HIGH COST– LACK OF RESOURCES, KNOWLEDGE, TECHNOLOGY,

COMPETENCES, SKILLED SPECIALISTS

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INTERNATIONAL BUSINESS ENVIRONMENT: WHERE?

DIFFERENT POLITICAL AND ECONOMIC ENVIRONMENTDIFFERENT POLITICAL AND ECONOMIC ENVIRONMENT– POLITICAL RISKS, GROWTH RATE, INFLATION

DIFFERENT CURRENCIESDIFFERENT CURRENCIES– EXCHANGE RATE FLUCTUATIONS

NATIONAL REGULATION DIFFERENTIALSNATIONAL REGULATION DIFFERENTIALS– ESTABLISHMENT, TAXATION, FUND REMITTANCE,

CURRENCY CONVERTIBILITY

NATIONAL CULTURAL DIFFERENTIALSNATIONAL CULTURAL DIFFERENTIALS

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RUSSIA: BUSINESS OPPORTUNITIES

Igor Savelyev, Wrigley’s chief for Eastern and Southern Europe: “We’re open to more acquisitions in Russia.There’s huge growth opportunityhuge growth opportunity.” 17.09.2007.

Peter Forster, GM Europe president:“We remain bullish and dedicated to Russiabullish and dedicated to Russia.” 11.11.2008,at the ceremony of official opening a new plant in St. Petersburg.

Sanjay Khosla, president of Kraft Foods International Inc:“We have already invested $100 millionin the construction of the coffee plant...This year we will invest $50 million more to double that capacity.According to our forecasts, the crisis will not change anythingthe crisis will not change anything…We see this trend clearly, even in the first months of 2009.”09.06.2009, an interview with Vedomosti newspaper.

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RUSSIA: BUSINESS OPPORTUNITIES

Unilever plans to spend $140 millionplans to spend $140 millionon building Russia’s largest ice cream factory.Unilever so far has 2,000 employees in its Russian companies Antoine de Saint-Affrique, executive vice president of Unilever’s Central and Eastern European businesses:“The potential for growth is enormous here”.Russia is “a key strategy priority” for Unilever,as it has “been raising market share” and will “continue to do so.We are extremely active in this countryextremely active in this country”.03.07.2009, an interview with St. Petersburg Times newspaper.

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RUSSIA: BUSINESS OPPORTUNITIES

Intel has hired some 600 Russian computer specialists600 Russian computer specialists. Moscow-based Elbrus and its Novosibirsk subsidiary Unipro – two prominent but sash-strapped research centres – signed an agreement with Intel in May, 2004. The employees will actually be on the Intel’s payrollactually be on the Intel’s payroll.Christian Anderka, Intel spokesman: “This makes Russiaa very significant R & D centre for usa very significant R & D centre for us. This is partof our commitment to invest in growing economies.”

Hewlett-Packard announced plans to opena research centre in St. Petersburgresearch centre in St. Petersburg as a result of a strategy “establishing research centres in growing economies.”Shane Robison, HP executive vice president and chief strategy and technology officer: “Russia’s high growth and pool of talent make itan exciting locationan exciting location to expand HP’s global research capabilities.”30.01.2007, the statement distributed on the web.

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COUNTRY RISKS (THREATS)

NEVERTHELESS!NEVERTHELESS! FOREIGN COMPANIES WIN 78 PERCENT OF TAX CASESWIN 78 PERCENT OF TAX CASES

BROUGHT AGAINST THEM BY THE STATE SINCE RUSSIA HAS RAISED EXPORT DUTIES ON TIMBER,

FORESTRY FIRMS INVESTED IN PROCESSING THERE

Possible regulation changesregulation changes

Low level of economic freedomeconomic freedom

High level of corruptioncorruption index

Two-digit inflationinflation

Dependence on oil prices oil prices

Growing gap Growing gap between rich and poor families

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GOALS OF INTERNATIONALISATION:WHAT FOR? DEMAND FACTORSDEMAND FACTORS

– MARKETS; CUSTOMER ACCESS

SUPPLY FACTORSSUPPLY FACTORS– UNIQUE OR CHEAPER RAW MATERIALSRAW MATERIALS– PRODUCTION EFFICIENCY (LABOURLABOUR, ETC.)– KNOWLEDGEKNOWLEDGE, TECHNOLOGY, COMPETENCES, SKILLS– ATTRACTIVE BUSINESS CLIMATEBUSINESS CLIMATE (REGULATIONS, ETC.)

INTERNATIONAL DIVERSIFICATION OPPORTUNITIESINTERNATIONAL DIVERSIFICATION OPPORTUNITIES

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FOREIGN MARKET AND/OR INDUSTRY ENTRY

MARKET ENTRYMARKET ENTRY

RUSSIA IS MAINLY A MARKETMARKET FOR COMPANY’S PRODUCTS

INVESTMENT IS NOT NEEDEDINVESTMENT IS NOT NEEDED (OR COULD BE RELATIVELY SMALL TO SUPPORT COMMERCIAL / DISTRIBUTION OR ADMINISTRATIVE FUNCTIONS)

INDUSTRY ENTRYINDUSTRY ENTRY

RUSSIA IS VIEWEDAS A SET OF RESOURCESSET OF RESOURCES

RESOURCES MAY BE IMPORTED OR MAY BE PROCESSED ON THE SPOT (FOREIGN DIRECT FOREIGN DIRECT INVESTMENTINVESTMENT USUALLY TAKES PLACE)

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MARKET ENTRY FOLLOWEDBY INDUSTRY ENTRY: FORD MOTOR Ford MotorFord Motor, a U.S. MNC, was selling its passenger cars

in Russia since the beginning of 1990s. In 2001, Ford after investing $150 million set up a facility

in a Town of Vsevolozhsk, Leningrad RegionTown of Vsevolozhsk, Leningrad Regionto assemble Focus cars.

A number of employees is 2000 persons.

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FOREIGN OPERATION METHODS (FOM): HOW?

ANY TYPE OF BUSINESS ACTIVITYANY TYPE OF BUSINESS ACTIVITYTHAT CROSSES NATIONAL BORDERSTHAT CROSSES NATIONAL BORDERS

INTERNATIONAL COMMERCIAL OPERATIONSINTERNATIONAL COMMERCIAL OPERATIONS– MERCHANDISE TRADE AND SUPPORTING OPERATIONS;

TRADE IN KNOWLEDGE, TECHNOLOGY, KNOW-HOW;TRADE IN SERVICES

INTERNATIONAL CONTRACTUAL OPERATIONSINTERNATIONAL CONTRACTUAL OPERATIONS– LICENSING, FRANCHISING, CONTRACT MANUFACTURING

INTERNATIONAL INDUSTRIALINTERNATIONAL INDUSTRIALAND TECHNOLOGY CO-OPERATIONAND TECHNOLOGY CO-OPERATION– JOINT PROJECTS

FOREIGN DIRECT INVESTMENTFOREIGN DIRECT INVESTMENT– INTERNATIONAL INSTITUTIONAL INTEGRATION

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TIMING OF ENTRY: WHEN?WINDOW OF OPPORTUNITIES

PREMATURE PHASEPREMATURE PHASE (LOW DEMAND, ETC.)

WINDOW PHASEWINDOW PHASE– THE CHOICE IS TO TAKE A FIRST-MOVERFIRST-MOVER VIEW

OR A FOLLOWERFOLLOWER VIEW

COMPETITIVE GROWTH PHASECOMPETITIVE GROWTH PHASE– NEW ENTRY IS RISKY

MATURE PHASEMATURE PHASE– COMPETITION IS WELL ESTABLISHED

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MULTINATIONAL CORPORATIONS

Responsibilities of International ManagerResponsibilities of International Manager:

Know a contentcontent and specific featuresspecific featuresof international business operations

Understand the main reasonsthe main reasons for foreign expansion Define internationalisation goals internationalisation goals for the company Know the nature and legal termsnature and legal terms

of a multinational corporation’s organisation

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MULTINATIONAL CORPORATION

AN ENTERPRISE WHICH OWNSOWNS OR CONTROLSCONTROLSPRODUCTION OR SERVICE FACILITIESOUTSIDE THE COUNTRYOUTSIDE THE COUNTRY IN WHICH IT IS BASED

FDIFDI IS AN ACTIVITY WHICH IS SPECIFIC TO MNCs PARENT COMPANY PARENT COMPANY IS LOCATED

IN A HOMEHOME (PARENTPARENT) COUNTRYCOUNTRY ITS SUBSIDIARIESSUBSIDIARIES (USUALLY WITH MAJORITY INTEREST

OF A PARENT COMPANY) ARE LOCATEDIN HOST COUNTRIESHOST COUNTRIES

IF A PARENT COMPANY’S SHAREIN A FOREIGN ENTERPRISE IS NOT HIGH(USUALLY 49 PERCENT OR LESS) THIS ENTERPRISEMAY BE CALLED AS AFFILIATED COMPANYAFFILIATED COMPANY (AFFILIATE)

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MNC COMPOSITION

THE MNC OF TODAY MAY WELL BETHE FOREIGN SUBSIDIARY OF TOMORROW

A MULTINATIONAL COULD WELL BECOMETHE TARGETTARGET OF A TAKEOVER BID BY FOREIGN MNCs

© Andrey Medvedev© Андрей Медведев

MNC COMPOSITION: BSH

BSHBSH (Bosch und Siemens Hausgeräte GmbHBosch und Siemens Hausgeräte GmbH) is a Munich-based corporate group stemmed from a joint venture set up in 1967 between Robert Bosch GmbH and Siemens AG. BSH is today made upof 70 companies in 41 countries70 companies in 41 countries, employing about 39,000 people.

At its 43 plants located in 15 countries43 plants located in 15 countries (Germany, France, Greece, Poland, Russia, Slovakia, Slovenia, Spain, Turkey, the United States, Mexico, Brazil, Peru, China, and Thailand), BSH produces a full range of major household appliances, including cooking equipment, dishwashers, refrigerators, freezers, washing machines,and dryers, as well as vacuum cleanersand small appliances such as coffeemakers,food processors, deep fryers, and irons.

With annual sales in the year 2008 in excess of €8.8 billion€8.8 billion,BSH is the largest maker of household appliancesin both Germany and Western Europe, and ranks third worldwide.

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QUANTITATIVE DIMENSIONSOF MULTINATIONALS NUMBER OF COUNTRIES NUMBER OF COUNTRIES (INTERNATIONAL DIVERSIFICATION)

NUMBER OF SUBSIDIARIESNUMBER OF SUBSIDIARIES II – NUMBER OF FOREIGN SUBSIDIARIESII – NUMBER OF FOREIGN SUBSIDIARIES

AS A PERCENTAGE OF TOTAL NUMBER OF SUBSIDIARIESAS A PERCENTAGE OF TOTAL NUMBER OF SUBSIDIARIES

REVENUE GENERATED FROM FOREIGN OPERATIONSREVENUE GENERATED FROM FOREIGN OPERATIONSFOREIGN ASSETS,FOREIGN ASSETS,AND NUMBER OF FOREIGN EMPLOYEES NUMBER OF FOREIGN EMPLOYEESAS A PERCENTAGE OF TOTAL REVENUES,ASSETS, AND NUMBER OF EMPLOYEES

TNI – TNI – INDEX COMBINING ALL THREE DIMENSIONS(REVENUES, ASSETS, AND NUMBER OF EMPLOYEES)(REVENUES, ASSETS, AND NUMBER OF EMPLOYEES)

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MNC CHARACTERISTICS:NESTLÉ ASSETS $76.965 BILLION OF WHICH ABROAD $65.396 BILLION REVENUES $69.778 BILLION OF WHICH ABROAD $68.586 BILLION NUMBER OF EMPLOYEES 247 000 OF WHICH ABROAD 240 406 TNITNI 93.5% 93.5% (2004)

NUMBER OF SUBSIDIARIES 501 OF WHICH ABROAD (IN 86 COUNTRIES) 471 (13 IN RUSSIA) IIII 94.1% 94.1% (2006)

2008: NET PROFIT WAS €12 BILLION (69.4 PERCENT GROWTH)

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LARGEST MNCs BY REVENUES, $ BILLION

Corporation Country Revenues* TNI,%**II,%**

Wal-Mart Stores US 378.799 24.1 83.3 ExxonMobil US 372.824 63.0 75.5 Royal Dutch/Shell UK 355.782 71.9 40.3 BP UK 291.438 81.5 72.8 Toyota Motor J 230.201 49.4 37.8 Chevron US 210.783 56.6 48.4 Total F 187.280 74.3 71.2 General Motors US 182.347 34.0 57.2 ConocoPhilips US 178.558 39.2 51.8 Daimler D 177.167 General Electric US 176.656 47.8 68.0 Ford Motor US 172.468 48.7 60.2

* 2008 ** 2004

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MULTINATIONALS WITH THE LARGEST TRANSNATIONALISATION INDEX

Corporation Country TNI Nestlé Switzerland 93.5% Thomson Canada 93.3% Solvay Belgium 89.6% ABB Sweden/Switzerland 88.6% Electrolux Sweden 88.3% Unilever Netherlands/UK 87.1% Philips Electronics Netherlands 85.4% Roche Holdings Switzerland 85.1% SCA Sweden 79.7% Northern Telecom Canada 78.4% Glaxo Welcome UK 76.5% Cable and Wireless UK 75.6%

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GLOBAL REVENUE INDEXAND GLOBAL CAPACITY INDEX

PROPOSED BY P. LASSERRE, THE GLOBAL REVENUE INDEXGLOBAL REVENUE INDEX REPRESENTS THE RATIO OF A COMPANY’S DISTRIBUTION OF SALES IN THE MAJOR WORLD REGIONS TO THE INDUSTRY’S DISTRIBUTION OF DEMAND IN THE SAME REGIONS

THE GLOBAL CAPACITY INDEX GLOBAL CAPACITY INDEX REPRESENTS,IN A SIMILAR WAY, THE RATIO OF ASSETS OR PERSONNEL

BY COMBINING THE GCI AND GRI IN ONE CHART, ONE OBTAINS A MAPPING OF THE GLOBAL AMBITION OF PLAYERS

THE GLOBAL STRATEGIC AMBITIONGLOBAL STRATEGIC AMBITION EXPRESSES THE ROLEA COMPANY WANTS TO PLAY IN THE WORLD MARKETPLACE AND HOW IT VIEWS THE FUTURE COMPOSITION OF ITS SALES AND ASSETS IN THE KEY REGIONS OF THE WORLD

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MAPPING OF GLOBAL STRATEGIC AMBITIONACCORDING TO P. LASSERRE

Global Capability Index (GCI)

Global Revenue index (GRI)

0

1

0 1

Global Player

Global Exporter

Global Operator

Regional Player Exporter

Regional Dominant Global Player

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PARENT’S VALUESAND STRATEGIC DECISIONS ETHNOCENTRISMETHNOCENTRISM

– STRATEGIC DECISIONS ARE GUIDED BY THE VALUEAND INTERESTS OF THE PARENT COMPANY ALONE

POLYCENTRISMPOLYCENTRISM– STRATEGIC DECISIONS ARE TAILORED TO SUIT THE CULTURES

OF THE VARIOUS COUNTRIES IN WHICH THE MNC COMPETES

REGIOCENTRISMREGIOCENTRISM– A STRATEGY TRIES TO BLEND THE INTERESTS

OF THE PARENT COMPANY WITH THAT OF THE SUBSIDIARY,AT LEAST ON A LIMITED REGIONAL BASIS

GEOCENTRISMGEOCENTRISM– THE MNC SEEKS TO INTEGRATE DIVERSE SUBSIDIARIES

THROUGH A GLOBAL SYSTEMS APPROACH TO DECISION-MAKING

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MNC VALUES:TOTAL TotalTotal is a multinational energy company committed

to leveraging innovationinnovation and initiativeand initiative to providea sustainable response to humankind’s energy requirements.

The world’s fourth-largest oil and gas companyand a world-class chemicals manufacturer,Total operates in more than 130 countries.

In addition to conducting its business accordingto the highest standards of professionalhighest standards of professionalbehaviourbehaviour, Total maintains an ongoing commitmentto transparency, dialogue and respect for otherstransparency, dialogue and respect for others.

Total is strategically dedicated to meeting the challengesfaced by all its businesses when developing natural resources, protecting the environmentprotecting the environment, integrating its operations into host country cultureshost country cultures, and dialoguing with civil societydialoguing with civil society.

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MNC GENERAL PROFILE:STORA ENSO The second largest paper & board producerpaper & board producer in the world. It is

an integrated forest products company producing magazine papers, newsprint, fine papers, packaging boards, and wood products.

Total salesTotal sales were EUR 12.2 billion in 2003. Percentage of sales by Percentage of sales by countrycountry is: Germany (15 percent), North America (11), UK (11), Sweden (8), France (8), Finland (6), and other countries (33 percent).

CapacitiesCapacities are located in Finland (35 percent), Sweden (24), North America (17), Germany (15), other Europe (8), and Asia (1 percent).

Average number of employeesnumber of employees in 2004 was some 44 000. Percentage of employees by countryPercentage of employees by country is: Finland (34 percent), Sweden (21.3), USA (13.7), Germany (10.8), France (3.1), and other countries (17.1 percent).

TNITNI (2004) = 68.2%. IIII = 88.8%.

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MNC PRESENTATION: BASF

In 1865 the stock corporation Badische Anilin- & Soda-Fabrik (BASFBASF) was founded by Friedrich Engelhornfor the production of coal tar dyes and preliminary products.

BASF is the world’s leading chemical company with customersin more than 170 countries, more than 100 large production sitesin 41 countries and approximately 94 000 employees. The numberof subsidiaries is 298, of which 241 are located outside Germany.

In 2004, BASF posted sales of €37.5 billion: 22.5 in Europe(15.2 in Germany), 9.9 in Americas, and 5.2 in the ROW. TNI = 54%.

BASF supplies 8,000 products from its five business segments: chemicals (19% of total sales), plastics (28%), performance products (21%), agricultural products & nutrition (14%), and oil & gas (14%).

BASF's customer industries are chemical, automotive, energy, agriculture, construction, and others.

BASF's strategic goal is to continue to grow profitably.

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MNCs IN THE WORLD

A NUMBERA NUMBER OF ENTERPRISES CLASSIFIED AS MNCMNCAPPEARS AS 77 000 (UNCTAD REPORT, 2005)

SUBSIDIARIESSUBSIDIARIES OF MNCs COUNT IN EXCESS OF 850 000.

NUMBER OF EMPLOYEESNUMBER OF EMPLOYEES AT MNCS’ SUBSIDIARIES AMOUNTS TO 72 MILLION (2005)

MNC OUTPUT ABOUT ONE-FIFTHONE-FIFTHOF THE GROSS INTERNATIONAL PRODUCTGROSS INTERNATIONAL PRODUCT

MNCS CONTRIBUTE TO 2/32/3 OF THE WORLD TRADEWORLD TRADE

IN SOME COUNTRIES,A SHARE OF MNC AMOUNTS TO ONE THIRD OF THE GDPONE THIRD OF THE GDP

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LARGEST MNCs IN EUROPE:COUNTRY OF ORIGIN

GERMANYGERMANY 77 DAIMLER, VOLKSWAGEN, SIEMENS, E.ON, DEUTSCHE POST, METRO, DEUTSCHE TELECOM

FRANCEFRANCE 55 TOTAL, CARREFOUR, ARCELORMITTAL,

PEUGEOT, ELECTRICITÉ DE FRANCE

UNITED KINGDOMUNITED KINGDOM 33 ROYAL DUTCH SHELL, BP, TESCO ITALYITALY 22 ENI (ENERGY), FIAT RUSSIARUSSIA 11 GAZPROM SWITZERLANDSWITZERLAND 11 NESTLÉ NORWAYNORWAY 11 STATOILHYDRO

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ADVANTAGES OF MULTINATIONALS

ECONOMIES OF SCALE

MANAGERIAL AND MARKETING EXPERTISE

ADVANCED TECHNOLOGIES

FINANCIAL STRENGTH

DIFFERENTIATED PRODUCTS

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ST. PETERSBURG AND LENINGRAD REGION (OBLAST)

LENINGRAD OBLAST

FINLAND

ESTONIA

LAKE LADOGA

GULF OF FINLAND

LAKE ONEGA

Lodeinoe Pole

Podporozhje

Tosno

KirovskPetrokrepost

Vsevolozhsk

PriozerskSvetogorsk

Vyborg

Primorsk

Sosnovyi Bor

Kingisepp

Slantsy

Luga

Gatchina

The important industrial centres

ST. PETERSBURG

Tikhvin

Kirishi

Volkhov

Ivangorod

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MNC GENERAL PROFILE PRESENTATION:ASSIGNMENT IN GROUPS OF 2

SELECT A MULTINATIONAL CORPORATION

SEARCH FOR INFORMATION ABOUT THE MNC– REPORTED DATA

– THE LAST NEWS

STUDY THE INFORMATION COLLECTED

PREPARE A REPORT ON MNC’S GENERAL BUSINESS PROFILE– A WRITTEN REPORT (2 PAGES)

– AN ORAL PRESENTATION BY SELECTED TEAMS,SEPTEMBER 14 (5 MINUTES)