Global Business Environment

SUMMARY: Globalization is a three dimensional concept. It is a phenomenon, a philosophy, and a process. The international business environment can be defined as the environment in different sovereign countries, with factors exogenous to the home environment of the organization, influencing decision making on resource use and capabilities. The international business environment can be classified into the environment external to the firm and the environment internal to the firm. The external environment includes the social, political, economic, regulatory, tax, cultural, legal, and technological environments. To function effectively and efficiently, companies operating internationally must understand the social environment of the host country they are operating in. Today there are thousands of MNCs which operate in many parts of the globe.