To understand international business is to understand the global business environment, global competition, free trade, and the imperative quality. All these contribute to business growth and job creation. Under business environments are the legal and economic environment, and technological environment. Successful tips for legal and economic environment are: Freedom to own your business, ability to draft contract laws, possibility of getting rid of corruption, ability to trade currency, and minimization of taxes and regulations. For technological environmental tips, come the usage of databases, bar codes, internet, and information technology. Understanding these tips and utilizing them will enhance and promote global business environment. For global competition environment to prosper, the following must exist to stimulate global competition and free trade: businesses must provide employee service, have customer service, show concern for the environment, and recognize stakeholder position. Lastly, the imperative quality encompasses the social environment, which includes demographic changes, diversity, and family changes.
There are reasons why some countries are richer than others, and the value drivers to this are: (1) land, which is the natural resources; (2) labor, which is employees or workers; (3) capital, which includes building, machines, tools, and anything used in the production of goods and services with the exception of money; (4) entrepreneurship, and (5) knowledge. A country may have vast amount of land and natural resources, but still cannot create wealth without knowledge employees. Many poor countries have many laborers or workers but unfortunately cannot create wealth without knowledge. Capital by itself cannot create or produce wealth without entrepreneurs who will utilize it, and put it to use. Businesses tend to grow in a healthy environment, and the outcomes are prosperity and wealth that allow the achievement of high quality of life and a high standard of living. Poor business environment contributes to job losses, business failure, low quality of life, and a low standard of living. Countries are rich when they effectively use both knowledge and entrepreneurship in the most efficient way to produce goods and services. Any government that wants to grow and prosper must promote entrepreneurship by allowing private ownership of businesses. Ownership of businesses by governments gives citizens less incentive to strive, work hard, and create wealth for their respective countries. Understanding or creating the right international business environment is the basic foundation to social progress for all concerns, and that also includes low crime rates, good schools, good health care, water, and clean air.
Entrepreneurs, when given the private ownership by the government will effectively use the five factors of production under the right environment to create wealth and profit to enrich their countries. For consulting services, go to http://www.iba-pec.com for advice.