PowerPoint Presentation
Global EnvironmentsMuhammad Yusuf IbrahimAhmad RifqyJeremia
MichaelRefi ReyhandiTypes of EnvironmentsLegal
EnvironmentTechnological EnvironmentAccounting EnvironmentPolitical
EnvironmentLegal EnvironmentMajor Types of Legal Systems:Common
LawCivil LawReligious LawBureaucratic LawDomestic Law and Its
EffectDomestically Oriented LawLaws Directly Affecting
International Bussiness Transactions (ex: embargo)Laws Directed
Against Foreign Firms (ex: nationalization, privatization)
International Business Disputes4 questions to resolve international
disputes:Which countrys law applies?In which country should the
issue be resolved?Which technique should be used to resolve the
conflicts?How will the settlement be enforced?Technological
EnvironmentTo increase technology:InvestmentTechnology
transferIssues: Intellectual Property rightsAccounting
DifferenceThe Accounting Environtment8Influences on a Countrys
Accounting SystemDifferences in Accounting PracticesOther
DifferencesCapitalization of Financial LeaseCapitalization of
R&D ExpensesTreatment of Goodwilll Political EnvirontmentThe
Political EnvirontmentExamples of Political RisksExpropriation
& ConfiscationCampaigns against foreign goodsMandatory labor
benefits legislationWars, Violence &
ThreatInflationRepatriationCurrency DevaluationIncreaced
Taxation
Degree of Political RiskMacropolitical RiskAffects all firms in
a country; examples are the civil wars that tore apart Sierra
Leone, Zaire, Bosnia, and Rwanda in the 1990s or the recent
conflicts in Afghanistan, Iraq, and Liberia. Micropolitical
RiskAffects only a specific firm or firms within a specific
industry. Saudi Arabias nationalization of its oil industry in the
1970s, as is the Venezuelan governments recently announced
requirements that foreign oil companies renegotiate their contracts
with the government.Entering new countryAny firm contemplating
entering a new market should acquire basic knowledge of that
country, learning, for example, about its political and economic
structures in order to control the firms political risks.Insurance
Against Political RiskU.S Overseas private Investment Corporation
(OPIC)World BankMultilateral Investment Guarantee Agency
(MIGA)CulturePeran KebudayaanKebudayaanKebudayaan merupakan
kumpulan nilai, kepercayaan, kebiasaan, adat istiadat, dan perilaku
yang dapat membedakan suatu masyarakat dengan masyarakat
lainnya.Karakteristik BudayaPerilaku yang dipelajariSaling
berhubunganAdaptifDilakukan bersamaElemen budayaTatanan
SosialBahasaKomunikasiAgamaNilai dan SikapNilai dan SikapHalls
Low-Context-High Context ApproachCountry Of Low Context and
High-Context CulturesCultural Cluster ApproachCountries that share
many cultural similarities although differences do remain. We
grouped countries that have cultural similarities each
other.Country of Cultural Cluster ApproachHofstedes Five
DimensionsSocial OrientationIndividualismCollectivismThe interests
of the individual take precedenceThe interests of the group take
precedenceExample :SalarySwitching a jobHofstedes Five
DimensionsPower OrientationPower RespectPower ToleranceAuthority
Inherent in ones position within a hierarchyIndividuals assess
authority in view of its perceived rightness of their own personal
interestsHofstedes Five DimensionsUncertainty
OrientationUncertainty AcceptanceUncertainty AvoidancePositive
response to change and new opportunitiesPrefer Structure and
consistent routineExample :Plane Crash Tragedy(Swissair 111)The way
to Raise the capitalGoal OrientationAggressive Goal
BehaviourPassive Goal BehaviourHofstedes Five DimensionsValue
Material Possesion, money and AssertivenessValue Social Relevance,
quality of life and the welfare of othersHofstedes Five
DimensionsTime OrientationLong Term OutlookShort-Term OutlookValue
Dedication, hard work and thriftValue Traditions, social
ObligationsInvesting in Souteast AsiaGDP Growth
GDP Growth
Big Market
FranchisesYUM! Brands, with KFC and Pizza Hut have more than 700
location in Indonesia and more than 500 in each Malaysia and
Thailand.Restaurant Franchise have had the most success in entering
SE. Asia marketMost of the franchises enter the region through
agreement with local companies. (ex: PT. Fastfood
Indonesia)ConstraintIndonesiaNew Law that place limit on the number
of location that outside franchises can openMalaysiaHard to
register a new franchise, government is very
involvedMyanmarStabilization period after military regime
VietnamLack of companies with the development and operation
experience to handle big franchisesSingaporeLack of premium spaces
(location)Solution: Marketing MixProductMalaysiaProductHalal
aspectFocused on ComboVariety of BurgersSide dish : buns, mash
potato, fries, wedges and nuggetTaste : Prefer
SpicyDivisionIndividual, family, budget, teen and
kidsIndonesiaProductHalal aspectFocused on a la carte and
varietyOnly two types of burger and filletsSide: rice, fries,
perkedel & soupsTaste : Must Have Rice and healtier food
choiceDivisionIndividual, Family, Budget, Youth and Kids
Solution: Marketing MixPriceMalaysiaPrice is quite premium for
Brand Core (main Dish) , although cheaper for teen, kids, combos
and time specific combos.IndonesiaPrice is quite premium for main
dish and cheaper on combos, cheaper than malaysia because
purchasing power and lower price of raw items in IndonesiaSolution:
Marketing MixPlaceMalaysiaTypes of outlets include free standing,
mall and food courtThe outlets are very evenly spread No government
regulation concerning opening of outletsIndonesiaTypes of outlets
include mobile, in-line, free standing, mall and food courtThe
outlets are very evenly SpreadThere is a government regulation to
protect small businesses, issue of supply chain and lack of proper
infrastructureSolution: Marketing MixPromotionMalaysiaMethods -
With traditional media with small presence on Social NetworksTarget
and Aims - New and younger generation as well as budget conscious
customersIndonesiaMethods - Traditional as well as creating active
social network and social eventsTarget and Aims Active and
happening population, teens, children, kids and budget conscious
customersConclutionGlobal companies use of local company to enter
new market.KFC successfully making proper changes to suit local
customer need and requirementsEnvironment can prevent companies to
enter new market if not handled appropriately, especially law and
political environment
