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    Global Management, M&A, Corporate Governance, Strategy

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    1. How difficult is it for merger and acquisition strategies to create value and which firms benefit the most from M & A activity?

    2. What are the incentives for firms to use international strategies? What are the three basic benefits firms can derive by moving into international markets?

    3. Explain the rationales for a cooperative strategy under each of the three types of basic market situations (i.e., slow, standard, and fast cycles).

    4. What is corporate governance and how is it used to monitor and control managers' decisions?

    5. Discuss the difference between strategic and financial controls.

    6. What is a top management team, and how does it affect a firm's performance and its abilities to innovate and design and implement effective strategic changes?

    7. What is the importance of international entrepreneurship?

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    Business Management

    1. How difficult is it for merger and acquisition strategies to create value and which firms benefit the most from M & A activity?

    Merger and acquisition strategies are successful only when there is synergy between merged companies. There have been numerous studies which have shown that more than 50% of mergers and acquisitions fail to create value. Some of such activities even result in loss in value. M&A is used by companies to increase scale of their operations, broaden their product portfolio and enter new markets. However M&A activity that begins with incorrect vision and is not executed at the right price fail to create shareholder value. With M&A strategies created with a vision and with right motive, there is another factor which determines whether strategy would work or not. It is the blending of culture which is very important. If there is disconnect between cultures of merging companies it would lead to failure of both companies. For example, merger of Alcatel-Lucent did not generate profits as expected, Daimler Chrysler had to separate when there were continuous losses of billions of dollars.
    Firms which realize that just acquiring a new company would not create value for them benefit the most from M&A activity. There firms demonstrate planning, synergies, alignment of management/organizational culture, and appropriate integration approach. Examples of companies which have been successful with M&A include Unilever, Heinz and Electrolux.

    2. What are the incentives for firms to use international strategies? What are the three basic benefits firms can derive by moving into international markets?

    As the world is becoming more and more borderless, in order to succeed, companies need to compete on a global level. Though international strategy is not for every company, with availability of internet becoming easier it is possible for exploring new territories for business. International strategies take advantage of allocation of company's resources to take advantage of profit opportunities outside of domestic markets. There are three major theories which explain the dynamics behind global strategies.
    Classical theory of international trade: Classical theory encompasses three advantages from global trade- absolute, comparative, and equal. It states that a country has a absolute advantage over another country when it is able to produce product at lower price or higher quality.
    Factor proportion: It explains for differences in price levels among various ...

    Solution Summary

    Response to business management questions with focus on global management, M&A, corporate governance, and strategy.

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