Banking Globalization and Global Imbalances Essay

Banking Globalization and Global Imbalances - Essay Example As such, in order for a bank to operate profitably in the foreign market, it must be able to gain or realize gains that are not available to local competitors. These gains to be realized when a bank is operating in foreign financial sector usually stem from; geographical risk diversification, competitive and comparative advantage factors and efficiencies that are not attained when operating exclusively in the local markets. On comparative advantages, better intermediation technologies, superior management quality, and innovative products are among the factors frequently cited by both the internalization theory and the electric theory of multinational corporations (De Haas & Lelyveld 2010). However, these factors are not permanent in the case of banks diversifying internationally based on the assumption that financial firms usually have intangible assets that cannot be imitated and management quality is easily transferable. Information is a crucial comparative advantage for a bank to operate in abroad markets. Organizations prefer doing business with a less number of banks to ensure that their sensitive financial information is not revealed to too many financial firms. As such, once a bank establishes a relationship with an organization, it has a competitive advantage in serving the firm’s operations in the foreign markets. The increased importance of information in the banking sector has resulted to the shift from cross-border borrowing and lending towards the foreign banks’ local operations in the emerging countries (Mariotti & Piscitello, 2010). One of the best ways of exploiting comparative advantages arising from the private information in foreign markets is following the client. This means that banks usually expand in the countries where their client choose to invest so that they can be able to offer them services that they need.  

International HRM Strategy Term Paper Example | Topics and Well Written Essays - 1000 words - 1

International HRM Strategy - Term Paper Example There was a steadfast improvement in the production and marketing activities in all subsidiaries. The HR ethnocentric strategy employed led to the rise of expatriate managers, who run the subsidiary organizations on behalf of the main office. The top management believes that expatriate managers can implement the American business working culture effectively towards development. These cultures involve management styles, industrial production processes and working overtime. Some social features inhibited smooth running of the business in the subsidiary organizations. In France, the labor force preferred to have an authoritative lines manager who would guide them instead of one who got his or her orders from the top management. An authoritative manager decides on his or her own (Kippenberger, 2002). The second cross- culture issue included in the case study involves working extra hours. The French work force believes in having both a professional and personal life. These cultural aspects counter the main idea for the tactic by not following the rules provided by the headquarters. Another option would include taking shifts, in the case of public holidays (Wakin, 1979). The employees and managers could decide that different groups remain behind on one holiday while the rest go and vice versa. Employees need to learn rather than train. Training involves attending classes, which consumes both time and money (Fottler, 2002). Furthermore, with the high rate of change in technology employees need to learn how to operate and adapt to new things. In terms of trade unions and participation, the human resource department worked towards a no union policy. Both local and international employees work towards the achievement of goals. The workers contributed in the production process and other subordinate activities, but not decision making. With the no union strategy, no unionized activities took place in either local or international sections of the firm.