Competing globally

This chapter deals with a case detailing the challenges of competing on a global scale. It describes the respective benefits of responsiveness and integration, their paradoxical relationship, and the ways in which companies can manage this tension. The chapter provides a discussion of the tension in the fundamental context of increasing sales versus increasing efficiency. In the 21st century, the competition moved from the domestic to the global arena. It is difficult to conceive of any business that is not affected by the international environment. The rise of global business is due to geopolitical and technological developments that took place over the past few decades. A firm internationalizes when it ventures outside its national boundaries. Informal institutions include the culture and norms of countries. Informal institutions are normative and cognitive. Countries also differ in terms of their factor endowments, such as the labor force characteristics, land, or capital.