Multinational, Global, International and Transnational

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Module 1

INTERNATIONAL BUSINESS

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Exercise 1. Learn the vocabulary.

extension – поширення

respond – реагувати (to)

threat – загроза, погроза

vision – бачення

maintain – підтримувати; зберігати

similarity – схожість, подібність

overseas – іноземний; закордонний

economy of scale – підвищення ефективності від зростання

масштабів виробництва

merger – злиття; об’єднання

joint venture – спільне підприємство

charter – надавати право здійснювати діяльність

denote – означати; значити

perceive – сприймати, розуміти

attempt – спроба; намагання; намагатися

Exercise 2. Read and translate text 1.

TEXT 1. INTERNATIONAL BUSINESS TERMINOLOGY

In some ways, international business is an extension of domestic business; in other ways, it is quite different. International business, like every field of study, has its own terminology.

Multinational, Global, International and Transnational

As with any new discipline, definitions of a number of words vary among users. For example, some people use the words “world” and “global” interchangeably with “multinational” to describe a business with widespread international operations; but others define a “global firm” as one that attempts to standardize operations in all functional areas but that responds to national market differences when necessary.

According to this definition, a global firm’s management:

1. searches the world for

· market opportunities

· threats from competitors

· sources of products, raw materials, and financing

· personnel, in other words, it has global vision;

2. seeks to maintain a presence in key markets;

3. looks for similarities, not differences, among markets.

Those who use global in this manner are defining a multinational company as a kind of holding company with a number of overseas operations, each of which is left to adapt its products and marketing strategy to unique aspects of local markets.

The United Nations and the governments of most developing nations have been using “transnational” instead of “multinational” for decades to describe a firm doing business in more than one country. Recently, some academic writers have employed the term for a company that combines the characteristics of global and multinational firms: (1) trying to achieve economies of scale through global integration of its functional areas while at the same time (2) being highly responsive to different local environments (a newer name is “multicultural multinational”). Businesspeople, though, usually define a transnational as a company formed by a merger (not a joint venture) of two firms of approximately the same size that are from different countries. Among the largest are Unilever (Dutch-English), Shell (Dutch-English), and ABB, a merger of ASEA (Swedish) and Brown-Bovari (Swiss). The term “supranational” corporation is described as one in which both the operation and ownership are multinational, one that would be chartered by an international agency such as the United Nations; yet such a corporate form does not now exist.

These definitions are generally accepted by businesspeople.

1. International business is a business whose activities involve crossing national borders. This definition includes not only international trade and foreign manufacturing but also the growing service industry in such areas as transportation, tourism, banking, advertising, construction, retailing, wholesaling, and mass communications.

2. Foreign business denotes the domestic operations within a foreign country. This term is sometimes used interchangeably with international business by some writers.

3. Multinational company (MNC) is an organization with multi­country affiliates, each of which formulates its own business strategy based on perceived market differences.

4. Global company (GC) is an organization that attempts to stan­dardize operations worldwide in all functional areas.

5. International company (IC) refers to both global and multi­national companies.

Exercise 3. Match the English and Ukrainian word combinations.

1. to respond to market differences	a. вести бізнес
2. sources of financing	b. виробництво за кордоном
3. to maintain a presence in key markets	c. реагувати на відмінності ринків
4. to do business	d. внутрішня діяльність
5. foreign manufacturing	e. зберігати присутність на ключових ринках
6. domestic operations	f. філії у декількох країнах
7. multicountry affiliates	g. джерела фінансування

Exercise 4. Say whether the following statements are true or false. Correct the false ones.

1. International business is absolutely different from domestic business. 2 Management of a global firm searches the world only for personnel. 3. Global vision is characteristic of global firms’ mana­gement. 4. For a firm doing business in more than one country the UN has been using the term “transnational” instead of “multinational”.
5. Businesspeople usually define a joint venture as a transnational company. 6. There are numerous supranational corporations at present. 7. Besides international trade and foreign manufacturing international business also includes the growing service industry. 8. International company does not refer to multinational companies.

Exercise 5. Paraphrase the following.

E.g. Definitions of a number of business terms may vary among users. – Various definitions of a number of business terms may be utilized by users.

1. Definitions of a number of business terms may vary among users. 2. A global firm’s management searches the world for market opportu­nities, raw materials, and personnel. 3. A multinational company is defined as a company with a number of overseas operations.
4. Inter­national businessis a business whose activities involve crossing national borders. 5. Multinational companyis an organization with multicountry affiliates. 6. ‘International company’ refers to both global and multinational companies. 7. The term ‘supranational corporation’ is described as one in which both the operation and ownership are multinational.

Exercise 6. Tell about the key ideas of text 1.

Exercise 7. Learn the vocabulary.

equate – прирівнювати

franchising – привілей, пільга, право

distillery – винокурний завод

indebted – заборгований

unilateral transfers – односторонній переказ

franchisor – той, хто надає право

franchisee – той, хто отримує право

Exercise 8. Read and translate text 2.

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