International business activities - Essay Example

International business activities are evaluated at trillion dollars per annum (WTO, 2005). This figure, according to the World Trade Organization,has the potential for substantial growth. For realization of the said growth, on the one hand, and the maintenance of its current annual scope, on the other, it is imperative that IB is managed in accordance with empirically proven, theoretically valid and time-tested paradigms (Kumar, Markeset and Kumar, 2005). Concurring with the aforementioned, Beer (2003) has forwarded Total Quality Management as the optimal international business management strategy. An analytical review of the root disciplines from which TQM derives validates Beer's (2003) assertion. To establish the correlation between TQM and IB, this essay will begin with a brief definition and overview of the latter. International business, which has both been facilitated by and imposed upon firms by the advent of globalization, may be briefly defined as the global exchange of goods and services, or cross border economic transactions. As a number of scholars have quite rightly pointed out, international business is the internationalization and the concomitant expansion of the scope of traditional business activities. Within this context, it may also be defined as a natural evolution in the development of the scope of business activities, from the intra-tribal to the inter-tribal, from the intra-township to the inter-township and from the national to the international (Wiles and Wiles, 2005; Carbaugh, 2005; Marx, 2006; Sundaram and Black, 2007). The implication here is that while international business is founded upon the same precepts and principles of traditional/national business and, accordingly, withstands adherence to the same management paradigms, the significant expansion of its parameters and sphere of activities necessitates the embrace of sociology, international economics, politics and linguistics, to name but a few disciplines. The reason why TQM emerges as a model paradigm for international business is that it is rooted in a number of disciplines which target the needs of IB. One of these root disciplines is sociology. Negotiations, central to business activities, are one of the most challenging of the economic transaction processes and when they unfold on the international, cross-cultural level, they become even more challenging (Neslin and Greenhalgh, 1983; Gulbro and Herbig, 1994; Gilsdorf, 1997; Foroughi, 1998; Kumar, Markeset and Kumar, 2005). This is largely because, within the context of IB, negotiations move from the level of reaching an agreement between individuals who have comparable world views to reaching a compromise between cultures whose representatives may have divergent world views, including conflicting values (Bjerke, 2006). The implication here is that IB paradigms must be culturally sensitive and adaptable, on the one hand, and culturally-informed, on the other (Bjerke, 2006). Turning to TQM, one finds that it embrace cultural sensitivity as a direct outcome of its consumer focus (Collins, 2005). The paradigm itself is premised on the supposition that if corporations are to succeed in diverse cultural environments and to successfully engage in cross-cultural negotiations, they have to embrace the culture of the environment in question, be it of their consumers or their business partners, and redefine themselves as insiders, rather than outsiders (Collins, 2005; Bjerke, 2006). Its embrace of sociology, therefore, marks TQM as highly well-suited to international businesses and, as a root discipline, is fundamental to the success of IB. As international business unfolds within the context of a global, as opposed to a national economy, international economics emerges as another fundamental root discipline. IB scholars acknowledge the presence of a synergetic and dynamic relationship between international economics and international business. On the one hand, IB is inextricably dependant on the health of the global economy for its own development, growth and, indeed, sustenance and, on the other hand, the global economy is largely dependant on IB for the same (Porter, 1990; Dunning, 2003; Narula, 1993). As IB ventures into the global economy, it must do so on the basis of information and knowledge and, indeed, must constantly monitor the economic structure in question for changes so that it may adjust itself accordingly. Knowledge of international economics and the continued upgrading and refreshing of that knowledge is fundamental to IB. TQM scholars have also highlighted the importance of international economies to TQM paradigms and, indeed, have integrated a set of statistical tools for the continued evaluation and measurement of the economy in question into their management paradigm (Amaratunga et al., 2001; Lawrie et al., 2004; Chan, 2004; Pollanen, 2005). In addition to sociology and international economics, organisational theory, a core discipline within IB paradigms, figures as a fundamental component of TQM. Conceding to the fact that the realm of organisational theory is an expansive one which refers to dozens of specific theories on organisational behaviour and management, Born (2006) more specifically identifies total systems management as fundamental to both IB and TQM. The fact that it has been identified as integral to the successful operation of international business stems from the its acknowledgement of the linkage between business excellence and the harmonisation between the organisation's external and internal environment. As per this particular approach to organisational management, organisational success cannot be attained in the absence of a fit between the organisation and the environment within which it is situated (Born, 2006; Flood and Jackson, 2007). TQM is premised on the same assumption and, accordingly, embraces total systems theory as its core organisational management theory. Within the context of the stated and to the extent that it emphasizes adaptation to the external environment, a total systems theory approach contributes to the successful operation of international business. On the basis of the foregoing discussion, TQM emerged as an ideal international business paradigm, largely because it embraces and addresses IB's concerns. This was demonstrated through reference to three of its root disciplines, international economics, sociology and organizational theory. While conceding to the fact that a deeper exploration of the paradigm will reveal many more such disciplines, the limitations of the current research disallowed the exploration of any others. Nevertheless, and despite the mentioned shortcoming, the root disciplines discussed in the foregoing served to shed light on the scope of international business, the strengths of TQM as an IB paradigm, and the extent to which each of the disciplines in question have the potential to contribute to the successful operation of international business. Bibliography Amaratunga, D., Baldry, D. and Sarshar, M. (2001) Process improvement through performance measurement: The balanced scorecard methodology.' 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