Trade Barriers Essay Example for Free

Trade Barriers Essay Management across cultures Culture refers to the values and expectations of a group of people.* It is important for managers to ascertain the culture of the host country and adapt the organization. One way to manage the organisation in one country may not be appropriate in another. When managing the operations in a particular subsidiary an approach needs to be developed in line with cultural values to ensure greater cooperation and participation of employees as well as ease of dealings with local firms and national institutions. *Gooderham Nordhaug (2003, p. 131). Globalisation of production The globalization of production refers to the sourcing of goods and services from locations around the globe to take advantage of national differences in the cost and quality of factors of production (such as labor, energy, land, and capital). By doing this, companies hope to lower their overall cost structure or improve the quality or functionality of their product offering, thereby allowing them to compete more effectively. (Hill, 2011) Global Consumer Preferences Consumer tastes and preferences are converging, even though some national differences persist. Part of the reason for the development of worldwide tastes and preferences is the presence of the mass media, exposure to goods from various countries, and marketing strategies of multinational firms that tend to offer standardized products worldwide, because doing so costs less than customizing goods to local conditions. Luis R. Gomez-Mejia. Management. P.41 Integrated economic markets The objective of economic integration is to reduce or eliminate barriers to the free flow of goods, services, labor, capital, and other inputs of production between member nations. Two major regional economic groups are present in Asia. The oldest is the Association of Southeast Asian Nations, or ASEAN, formed in 1967. It includes Brunei, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand, and Vietnam. The second is the Asia Pacific Economic Cooperation (APEC) group, founded in 1990. This group of countries has the potential to become highly influential if it were to turn itself into a free trade area. Doing so would make it the world’s largest trade bloc, because the 18 member states account for more than half of the world’s GNP. Luis R. Gomez-Mejia. Management. P.41