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13.6 End-of-Chapter Questions and Exercises

These exercises are designed to ensure that the knowledge you gain from this book about international business meets the learning standards set out by the international Association to Advance Collegiate Schools of Business (AACSB International).Association to Advance Collegiate Schools of Business website, accessed January 26, 2010, http://www.aacsb.edu. AACSB is the premier accrediting agency of collegiate business schools and accounting programs worldwide. It expects that you will gain knowledge in the areas of communication, ethical reasoning, analytical skills, use of information technology, multiculturalism and diversity, and reflective thinking.

Experiential Exercises

(AACSB: Communication, Use of Information Technology, Analytical Skills)

  1. Visit the websites of several corporations (e.g., General Electric, Procter & Gamble, and Unilever) that you believe may be trying to innovate with R&D operations in one of the BRIC emerging markets. Do you see any common patterns in how they discuss this strategy? Do they make any statements about intellectual property rights?
  2. Each year Cornell University’s Center for Sustainable Global Enterprise sponsors a BOP-themed essay competition. (Visit the competition’s website at http://www.johnson.cornell.edu/Center-for-Sustainable-Global-Enterprise.aspx.) The goal is to “highlight the challenges of implementing business in underserved markets and identify innovative business initiatives or solutions to those challenges.”“BOP Competition,” Cornell University Johnson Graduate School of Management, accessed February 12, 2011, http://www.johnson.cornell.edu/Center-for-Sustainable-Global-Enterprise.aspx. The awards range from $500 to $4,000, and winners are recognized on NextBillion.net. Review the winning essays and, individually or with a team, identify the basis for your own essay. Draft a short summary (approximately five hundred words) of it and share it with the class.
  3. Search YouTube for “bottom of the pyramid.” You’ll find several videos by C. K. Prahalad (e.g., http://www.youtube.com/watch?v=79JOHMrs8m4y and the Maastricht series starting with http://www.youtube.com/watch?v=VJUjzT--HUk). Beyond these videos, what other resources did you find? Poverty is likely to exist in most communities and not just developing economies. What opportunities in the BOP market exist in your community?

Ethical Dilemmas

(AACSB: Ethical Reasoning, Multiculturalism, Reflective Thinking, Analytical Skills)

  1. In 1998, Nike launched the World Shoe Project, which is a line of footwear targeted and designed exclusively for emerging markets in Asia, Africa, and Latin America. By January 2001, Tom Hartge and his team at Nike had sold only 404,520 pairs of World Shoes in China. One year later, even though the Nike CEO at the time, Phil Knight, remained a supporter, the World Shoe Project was “alive in spirit only.”Heather McDonald and Ted London, “Expanding the Playing Field: Case B: Nike’s World Shoe Project,” World Resources Institute Case Study, 2002. Part of the explanation for this state of affairs was that Nike expected the same profit margins on products regardless of markets. Should successful companies like Nike be expected to earn lower profits in emerging markets as a way to “give back” to society?
  2. What are some of the ethical concerns that come to mind for companies seeking to sell to the BOP? Review the Wikipedia entry on the Nestlé boycott (http://en.wikipedia.org/wiki/Nestlé_boycott) to see if you’ve identified and addressed all the ethical concerns raised in that case in your answer.