International Business Environment Essay Example | Topics and Well Written Essays - 2500 words

International Business Environment - Essay Example ultural differences, exchange risks, legal and taxation idiosyncrasies - scholars seeking to understand the cross-border effects have been picking from different disciplines (e.g., marketing, finance, operations, strategy, organizational behavior) the relevant theories and methods. The complexity and multidimensionality of the international business environment forced to the development of some frameworks trying to classify its components. Mascarenhas (1982) developed a perspective of multiple factors the multinational organizations faces due to environmental uncertainty and focused on foreign exchange uncertainty, political uncertainty, and employment problems. Hambrick (1982) divided the environment into four categories: administrative, engineering, entrepreneurial, and regulatory, and these categories in twenty sub-categories. Several other scholars contributed to the classification in two broad dimensions: task (competitors, customers, and suppliers) and remote (political/legal, social/cultural, technological, and economic) environment (Dess & Beard, 1984; Ebrahimi, 2000). More recently, Guisinger (2001), based on prior work, proposed the geovalent construct to comprised eight "mutually exclusive, exhaustive, quantifiable, and largely replicable" (Guisinger, 2000: 4) environmental dimensions and encapsulate some of the main features of the international business environment. These dimensions are: Culture, legal system, political risk, income profile, tax regimes, econography, exchange rate, and restrictions. Business environment have been particularly influenced by factors such as Political / Legal, Economic Social / culture, Technological and Environmental. These factors are know as PESTEL analysis and are widely used by business enterprises to audit their environment and to help them establish a strategic approach to their business activities. Organizations will be directly affected by the actions of government and other political events. Major events