Global Environment of Business

GLOBAL ENVIRONMENT OF BUSINESS

MBA 820 – 4 Credits (Required)

Fisher College of Business

Summer Quarter, 2009

Gerlach Hall, Rm. 365

M/W: 6:00 pm – 7:48 pm; 8:00 pm – 9:48 pm

Professors: Geoffrey M. Kistruck

736 Fisher Hall

614-688-4107

Office hours: By appointment

COURSE DESCRITPION & OBJECTIVES:

The purpose of this course is to provide students with a comprehensive understanding of the political, economic, social, and technological forces shaping today’s global business environment. Multinational corporations are increasingly exposed to greater risks associated with currency fluctuations, trade embargoes, and consumer boycotts. Similarly, domestic businesses must be increasingly aware of competitive threats related to new technologies or cheaper subsidized products arising from foreign entrants. Thus, globalization is a pervasive phenomenon that requires the attention of both foreign and local businesses alike.

The macro environment within which businesses operate is often beyond the direct control of managers. However, that does not mean that managers are unable to influence and change the degree to which such forces positively or negatively impact the performance of their organizations. Thus, through a series of background readings, case discussions, and expert speakers, we will attempt to not only develop a greater student awareness of the global business environment, but also to develop skills for mitigating or exploiting the resulting risks and opportunities that are presented.

The course content and sequencing will focus primarily on the four ‘PEST’ forces;

·  Political: free trade vs. protectionism, tax & FDI policies, trade agreements & disputes, privatization vs. nationalization, political risk

·  Economic: macroeconomic policy, national growth rates, currency fluctuations, interest rates, hyperinflation, recessions

·  Social: fair trade, worker rights, employee ethics, global warming, corruption

·  Technological: intellectual property, communications technology in emerging markets

COURSE MATERIALS:

The required readings materials for the course are as follows;

1. Weekly subscription to “The Economist” for the duration of the course. Register online for 12 weeks for $19.95 at;

https://www.economistsubscriptions.com/ecom903/global/index.php

1. Pietra Rivoli, The Travels of a T-Shirt in the Global Economy: An Economist Examines the Markets, Power and Politics of World Trade (Hoboken, NJ: John Wiley & Sons, 2009)

1. Readings posted on the CARMEN website for download

1. Course Reading Pack available for purchase at Uniprint

GRADING:

Grades will be based on the following criteria:

Participation: 20%

Weekly Quizzes 20%

Midterm Exam 25%

Group Project 35%

Total: 100%

Requests to discuss assignment grades will only be accommodated for up to one week from the date on which the grade is issued.

A. Weekly Quizzes (20%.)

Students will be expected to read each new weekly issue of The Economist throughout the duration of the course, and be prepared to answer a series of multiple choice questions at the beginning of each Wednesday evening’s class. Each quiz over the 10 week period will be worth 2% of the students’ final grade.

B. Participation (20%)

Participation is a key component of any course, but particularly in situations where the format is primarily case based. Thus, students will be expected to come to class having read all the assigned reading materials, and ready to discuss the assignment questions and key points of the case. Participation will be graded much more on quality than quantity. SIMPLE ATTENDANCE IS INSUFFICIENT TO WARRANT A GOOD PARTICIPATION GRADE.

C. Midterm Exam (25%)

At the mid-term point of the course, students will be required to write an in-class case-based exam. Students will be expected to identify the key issues in the case, understand and forecast the most salient environmental forces, and recommend actions to be taken on the part of the focal organization.

D. Group Project (35%)

Students will be asked to form groups consisting of 8 people prior to the end of the first class session. The overall project task involves tracing the history of a designated product all the way back to its point of origin. Specifically, the groups are assigned with identifying the different businesses involved in the product supply chain (raw material sourcing, production, assembly, distribution, etc.). Students should use the method employed in The Travels of a T-Shirt in the Global Economy as a general template.

However, the specific questions to be addressed should reflect the more specific content of the course. For instance, students should not only identify “who” made the product (business names are great but bonus points for names) and “where” the product was made, but more importantly “why” it was made in one location as opposed to alternative countries. What political, economic, social and technological forces played a role in determining why or how that product was assembled in that particular country? What role did exchange rates, trade barriers, consumer advocacy, or intellectual property threats play in determining where the product comes from? What environmental challenges are the different businesses involved in the production chain dealing with in today’s global environment?

Answering these questions will undoubtedly require a fair degree of research and contact with the separate businesses involved within the supply chain so I strongly suggest you begin working on the project early in the quarter and delegate tasks amongst your group members in an efficient manner.

Students will be expected to hand in a written report of a maximum 40 pages in length (inclusive of all appendices) outlining their findings. Additionally, each group will be required to conduct a 20 minute presentation during one of the final two sessions of the quarter. The grading breakdown for the written and presentation components is as follows;

Written Report: 25%

Presentation: 10%

Each group member will also be asked to conduct a confidential assessment of their own contribution as well as the contributions of each of their other group members. These assessments may be used to modify the individual member grades where obvious differences in effort and participation amongst group members exist.

DISABILITY SERVICES

Any student who feels s/he may need an accommodation based on the impact of a disability should contact me privately to discuss your specific needs. Please contact the Office for Disability Services at 614-292-3307 in room 150 Pomerene Hall to coordinate reasonable accommodations for students with documented disabilities.

ACADEMIC MISCONDUCT

Academic integrity is essential to maintaining an environment that fosters excellence in teaching, research, and other educational and scholarly activities. Thus, The Ohio State University and the Committee on Academic Misconduct (COAM) expect that all students have read and understand the University’s Code of Student Conduct, and that all students will complete all academic and scholarly assignments with fairness and honesty. Students must recognize that failure to follow the rules and guidelines established in the University’s Code of Student Conduct and this syllabus may constitute “Academic Misconduct.”

The Ohio State University’s Code of Student Conduct (Section 3335-23-04) defines academic misconduct as: “Any activity that tends to compromise the academic integrity of the University, or subvert the educational process.” Examples of academic misconduct include (but are not limited to) plagiarism, collusion (unauthorized collaboration), copying the work of another student, and possession of unauthorized materials during an examination. Ignorance of the University’s Code of Student Conduct is never considered an “excuse” for academic misconduct, so I recommend that you review the Code of Student Conduct and, specifically, the sections dealing with academic misconduct.
If I suspect that a student has committed academic misconduct in this course, I am obligated by University Rules to report my suspicions to the Committee on Academic Misconduct. If COAM determines that you have violated the University’s Code of Student Conduct (i.e., committed academic misconduct), the sanctions for the misconduct could include a failing grade in this course and suspension or dismissal from the University. If you have any questions about the above policy or what constitutes academic misconduct in this course, please contact me.

CLASS SCHEDULE

DATE / TOPIC / READINGS
Introduction & Project Background
June 22
(Kistruck) / Introduction, Opening Discussion, and Project Selection
June 24 / PROJECT WORKGROUPS / ·  The Travels of a T-Shirt in the Global Economy
The Political Environment
June 29 / Real-time perspective on political forces / ·  Guest Speaker Presentation
July 1
(Kistruck) / Understanding Trade Policy & Comparative Advantage / ·  READING: Free Trade vs. Protectionism: The Great Corn-Laws Debate (HBS 9-701-080)
·  CASE: Lucent in India (Ivey 9B01M047)
July 6
(Kistruck) / Managing Political Risk / ·  READING: Managing Risk in an Unstable World (HBS – R0506B)
·  CASE: Dell’s Dilemma in Brazil (Thunderbird A03-03-0021)
July 8
(Kistruck) / Navigating Privatization / ·  READING: Starting Over: Poland After Communism (HBR 95203)
·  CASE: Mekong Corporation & The Viet Nam Motor Vehicle Industry (Ivey 9A96H002)
The Economic Environment / **All readings for the ‘Economic Environment’ available on CARMEN
July 13
(Buser) / Macroeconomic Measures / ·  READING: Intro, Chapters 1 & 2 (excluding appendix)
July 15
(Buser) / International Trade and the Global Economy / ·  READING: Appendix to Chapter 2; Chapter 3
July 20
(Buser) / Issues of Production and Supply / ·  READING: Chapters 4 & 5
July 22
(Buser) / Analyzing the Business Cycle / ·  Chapter 6
July 27 / MIDTERM EXAM
The Social Environment
July 29
(Makhija) / Impacts of Corruption / ·  READING: Corruption in International Business (B) (HBS 9-701-129)
·  CASE: Enron and the Dabhol Power Company (Thunderbird A07-02-0008)
August 3
(Makhija) / Fair Trade & Human Rights / ·  READING: Worker Rights and Global Trade (HBS 9-703-034)
·  CASE: Planet Starbucks (Thunderbird A09-03-0007)
August 5
(Makhija) / Addressing Global Warming / ·  READING: Competitive Advantage on a Warming Planet (HBS R0703F)
·  CASE: Global Warming and the Kyoto Protocol (Ivey 9B01M071)
The Technological Environment
August 10 / Real-time perspective on social and technological forces / ·  Guest Speaker Presentation
August 12
(Kistruck) / Intellectual Property Risk / ·  READING: Changing Levels of Intellectual Property Rights Protection for Global Firms (HBS BH214)
·  CASE: Malaysia’s Multimedia Development Corporation (Ivey 9A98G001)
August 17
(Kistruck) / Technology Opportunities for Tapping BOP Markets / ·  READING: M-PESA – Mobile Money for the “Unbanked”
·  READING: ITC’s E-Choupal and profitable rural transformation
August 19
(Kistruck) /
PROJECT PRESENTATIONS
August 24
(Kistruck)