Question

Describe typical stages of firms expanding into international business and each stage’s impact on HRM.

Answer 1

There are basically three stages which firms or organizations need to consider while expanding into international business, and they are:

1. Initial Export Sale - An organization planning to make an impact in the international market initially needs to test if the idea is feasible or not and therefore may plan to send initial shipments to make out if the plan has any probability of working out in the international market.

2. Expansion Of international Sales - If the initial plan of sale is successful then the organization may plan to expand their business in the market because they have a chance of getting back returns from the same hence the decision will be taken based on the result that is received from the first stage.

3. Investments Abroad - If the first two stages are satisfactory for the organization and they have estimated profit and return of investments for the organization, then the organization can actually plan to make investments abroad because they are aware that such investments will provide them profit and revenue and that is the objective. Although initially if there is a bit of loss the organization should still continues because as the organization is new it may experience initial challenges but with time the situation has to improve.