Forms Of International Corporations
The world's economic and business environment has changed in fundamental ways over the past two decades. Firms now face growing incentives and pressures to seek opportunities in a world marketplace. David Shanks, suggests three major factors driving many domestic firms into international operations:
- maturation of the economies of the industrialized nations;
- emergence of new geographic market and business arenas; and
- lobalization of financial systems.
The typical evolution of the domestic firm into a multinational corporation is illustrated in Exhibit 1-5. These stages range from a slightly multinationalized company that simply exports products to foreign countries to global business.
In general, as a firm progresses from first stages to last stage, the international issues its management must face become more complex and difficult to manage.