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Soils Southeast Asia, on balance, has a higher proportion of relatively fertile soils than most tropical regions, and soil erosion is less severe than elsewhere. Much of the region, however, is covered by tropical soils that generally are quite poor in nutrients. Often the profusion of plant life is more related to heat and moisture than to soil quality, even though these climatic conditions intensify both chemical weathering and the rate of bacterial action that usually improve soil fertility. Once the vegetation cover is removed, the supply of humus quickly disappears. In addition, the often heavy rainfall leaches the soils of their soluble nutrients, hastens erosion, and damages the soil texture. The leaching process in part results in laterites of reddish clay that contain hydroxides of iron and alumina. Laterite soils are common in parts of Myanmar, Thailand, and Vietnam and also occur in the islands of the Sunda Shelf, notably Borneo. The most fertile soils occur in regions of volcanic activity, where the ejecta is chemically alkaline or neutral. Such soils are found in parts of Sumatra and much of Java in Indonesia. The alluvial soils of the river valleys also are highly fertile and are intensively cultivated. Climate All of Southeast Asia falls within the warm, humid tropics, and its climate generally can be characterized as monsoonal (i.e., marked by wet and dry periods). Changing seasons are more associated with rainfall than with temperature variations. There is, however, a high degree of climatic complexity within the region. Temperatures Regional temperatures at or near sea level remain fairly constant throughout the year, although monthly averages tend to vary more with increasing latitude. Thus, with the exception of northern Vietnam, annual average temperatures are close to 80 °F (27 °C). Increasing elevation acts to decrease average temperatures, and such locations as the Cameron Highlands in peninsular Malaysia and Baguio in the Philippines have become popular tourist destinations in part because of their relatively cooler climates. Proximity to the sea also tends to moderate temperatures. Precipitation Much of Southeast Asia receives more than 60 inches (1,500 millimeters) of rainfall annually, and many areas commonly receive double and even triple that amount. The rainfall pattern is distinctly affected by two prevailing air currents: the northeast (or dry) monsoon and the southwest (or wet) monsoon. The northeast monsoon occurs roughly from November to March and brings relatively dry, cool air and little precipitation to the mainland. As the southwestward-flowing air passes over the warmer sea, it gradually warms and gathers moisture. Precipitation is especially heavy where the airstream is forced to rise over mountains or encounters a landmass. The east coast of peninsular Malaysia, the Philippines, and parts of eastern Indonesia receive the heaviest rains during this period. The southwest monsoon prevails from May to September, when the air current reverses and the dominant flow is to the northeast. The mainland receives the bulk of its rainfall during this period. Over much of the southern Malay Peninsula and insular Southeast Asia there is little or no prolonged dry season. This is especially marked in much of the equatorial region and along the east coast of the Philippines. While the dry and wet monsoons are important in explaining rainfall patterns, so too are such factors as relief, land and sea breezes, convectional overturning and cyclonic disturbances. These factors often are combined with monsoonal effects to produce highly variable rainfall patterns over relatively short distances. While many of the cyclonic disturbances produce only moderate rainfall, others mature into tropical storms—called cyclones in the Indian Ocean and typhoons in the Pacific—that bring heavy rains and destruction to the areas over which they pass. The Philippines are particularly affected by these storms. Plant life Tropical forests in Southeast Asia Tropical forests in Southeast Asia The seasonal nature and pattern of Southeast Asia’s rainfall, as well as the region’s physiography, have strongly affected the development of natural vegetation. The hot, humid climate and enormous variety of habitats have given rise to an abundance and diversity of vegetative forms unlike that in any other area of the world. Much of the natural vegetation has been modified by human action, although large areas of relatively untouched land still can be found. The vegetation can be grouped into two broad categories: the tropical-evergreen forests of the equatorial lowlands and the open type of tropical-deciduous, or “monsoon,” forests in areas of seasonal drought. The evergreen forests are characterized by multiple stories of vegetation, consisting of a variety of trees and plants. Although a large diversity of tree species is found in these forests, members of the Dipterocarpaceae family account for roughly half of the varieties. Deciduous forests are found in eastern Indonesia and those parts of the mainland where annual rainfall does not exceed 80 inches. Just as in the equatorial forest, a wide variety of species is normally the rule. Certain species, such as teak, have become highly valued commercially. Teak is found in parts of Indonesia, Myanmar, Thailand, and Laos. In addition to these two basic types of vegetation, other regional patterns reflect topography. Especially noteworthy are coastal and highland plant communities. Mangrove belts, of which there are more than 30 varieties, occur where silt is deposited in coastal areas. Upland forests dominated by maples, oaks, and magnolias are found especially on mainland mountain slopes. Human activity has been rapidly altering the stands of virgin forest in Southeast Asia. Most deforestation results from removal for fuelwood and clearing for agriculture and grazing. Although only a relatively small portion of the total land area has been permanently cleared for cultivation—e.g., in Java (Indonesia) and western Luzon (the Philippines)—in some areas shifting cultivation has brought about the replacement of virgin forest with secondary growth. In addition, nearly all countries have commercial logging industries; notable are those in Indonesia, Malaysia, Thailand, and Myanmar. A growing problem has been illegal logging. Thus, timber harvesting has come to contribute significantly to deforestation. Programs in social forestry and reforestation have yet to halt the rapid denuding of the landscape. Animal life Southeast Asia is situated where two major divisions of the world’s fauna meet. The region itself constitutes the eastern half of what is called the Oriental, or Indian, zoogeographic region (part of the much larger realm of Megagaea). Bordering along the south and east is the Australian zoogeographic region, and the eastern portion of insular Southeast Asia—Celebes (Sulawesi), the Moluccas, and the Lesser Sunda Islands—constitutes a transition zone between these two faunal regions. a classroom in Brazil More From Britannica education: Southeast Asia Southeast Asia is notable, therefore, for a considerable diversity of wildlife throughout the region. These differences are especially striking between the species of the eastern and western fringes as well as between those of the archipelagic south and the mainland north. The differences stem largely from the isolation, over varying lengths of geologic time, of species following their migration from the Asian continent. In addition, the tropical rain forests in many parts of the region, with their great diversity of vegetation, have made possible the development of complex communities of animals that fill specialized ecological niches. Especially numerous are arboreal and flying creatures. orangutans orangutansOrangutans (Pongo pygmaeus) in Sumatra, Indonesia. The distinction between the two faunal regions is best depicted by their mammal populations. In general, Australia is inhabited largely by marsupials (pouched mammals) and monotremes (egg-laying mammals), while Southeast Asia contains placental mammals and such hybrid species as the bandicoot of eastern Indonesia. Small mammals such as monkeys and shrews are the most numerous, while in many areas the larger mammals have been pushed into more remote areas and national preserves. Bears, gibbons, elephants, deer, civets, and pigs are found in both mainland and insular Southeast Asia, as are diminishing numbers of tigers. The Malayan tapir, a relative of the rhinoceros, is native to the Malay Peninsula and Sumatra, while the tarsier is found in the Philippines and parts of Indonesia. A number of rare endemic species are found in Indonesia and East (insular) Malaysia, including the Sumatran and Javan rhinoceros, the orangutan, the anoa (a dwarf buffalo), the babirusa (a wild swine), and the palm civet. As the pace of development accelerates and populations continue to expand in Southeast Asia, concern has increased regarding the impact of human activity on the region’s environment. A significant portion of Southeast Asia, however, has not changed greatly and remains an unaltered home to wildlife. The nations of the region, with only few exceptions, have become aware of the need to maintain forest cover not only to prevent soil erosion but to preserve the diversity of flora and fauna. Indonesia, for example, has created an extensive system of national parks and preserves for this purpose. Even so, such species as the Javan rhinoceros face extinction, with only a handful of the animals remaining in western Java

Management and Globalization Global Management Why companies go global How companies for global Global Business environments Global Business Types of global business Pros and cons of global businesses Ethnic Challenges for global business Culture and Global Diversity Cultural intelligence Silent language of culture Tight and loose cultures Values and national cultures Global Management Learning Are management theories universal? Intercultural competencies Global learning goals Key concepts of the challenges of globalisation: Global economy Resources, markets and competition are worldwide in scope Internationalisation The process of increasing involvement in international operations Globalization/Deglobalization Glob- the growing interdependence among elements in the global economy The worldwide interdependence of resource flows, product markets and business competition World 3.0 Different views: World flat vs. round Distance is a metaphor that represents the degree of dissimilarities between countries Balancing cooperation in the global Global Management Global management - managing things in different countries Managing business and organizations with interests in more than one country What do we expect from global Managers Knowing how to adapt Knowing the language Global Manager Is culturally aware and informed on international affairs International Business Conducting for-profit transactions of goods and services across national boundaries International Motive Why do firms internatioalize their activities Cheaper labour Labour tax Natural resources Enrolments to do business Clientele Exclusive materials Personal benefits: Taxes Reasons why businesses go global Customers Suppluers Capital During (1993) - 4 motive 1. Market seeking 2. Efficiency Seeking 3. Resource seeking 4. Strategic Asset Seeking Cuervo Cazurra, Narula and un (2015) - 4 motive s Internationalization Motives A company may also explore the opportunities in different markets in order to take advantage and in some cases extend the product life cycle What is a Market Entry Strategy Involves the sale of goods or services to foreign markets but do not require expensive investments Franchising Exporting and importing Involve the sale of goods or services to foreign markets but do Types of market entry strategies Global sourcing Exporting Importing Licensing agreement Franchising Types of Foreign Direct Investment (FDI) strategies: Joint venture Strategic alliance Owned Subsidiary (sometimes called WOS) How to go abroad What conditions will affect the decisions of firms on how to internationalize their activities? During (1978)- Eclectic paradigm OLI model OLI- Ownership, Location and Internalization Advantages Ownership advantages Resources owned by the organization that can be transferred across locations include trademarks, production techniques and processes, managerial skills and other resources not available to the competitors Location Advantages Represent the implications of choosing to produce or to perform activities in a specific location (country or region) Internalization Advantages: The ability to internalize or to incorporate activities that add value to its business Evolution of Concepts- New Elements Although economic factors are certainly important to explain the formation, growth and expansion of firms within and across national borders, they are not sufficient to explain the additional complexity when a firm decides to expand its activities across national borders Economic factors Investigate the economic elements that affect the internationalization of firms Behavioural Elements Explaining the additional challenges (and perhaps opportunities) a firm faces in foreign host countries when compared to indigenous (local) firms Behavioural theories Johanson and Wiedersheim-Paul (1975) and Johanson and Vahlne (1977) Included the psychic Distance concept (beckerman,1956) to explain the internationalization behaviour of firms The Uppsala internationalization model Psychic distance is: the sum of factors preventing the flow of infomatio from and to the market Psychic Distance is a broad concept that includes several elements such as: language, culture, political systems, level of education, level of industrial development Firms behave in a “Risk Averse” manner It means that when the perceived risk goes down, the firm increase its commitment to the foreign market \ The Haier Group Data Strategy Big DATA and Small DATA The use of small data to satisfy individual customers’ needs, however, the book mentions a huge cultural shock at the plant in Camden, south caroline Ex: top down, hard hat colors and hierarchy Culutral Differnces can have a huge impact on the internationalization of firms Kogut and Singh (1988)- Cultural Distance Index First statsical study on the implication of ciltiral distance to the selection of entry mode When investigating in culturally distant countries, foreign firms can choose to partner with foreign firms in order to gain local knowledge and share the risk associated to the investment (higher commitment = higher risk) How Companies Go Global Global sourcing The process of purchasing materials or services around teh world for local use Exporting Selling locally made products in foreign markets Importing Buying foreign made products and selling them domestically Exports correspond to what percentage of Candain GDP What countries are the major trending partners of Canada Management and Globalization How Companies Go Global Licensing Agreement One firm pays a fee for rights to make or sell another company’s products What are the potential risks associated to licesning The case of new balance in China Franchising A fee is paid for the rights to use another firms name, branding and methods Insourcing Insourcing: refers to local job creation that results from foreign direct investment Types of insourcing Joint ventures: operate in a foreign country through co-ownership by foreign and local partners Strategic alliances: A partnership in which foreign and domestic firms share resources and knowledge for mutual gains Foreign subsidiaries: local operation completely owned by a foreign firm Criteria for choosing a joint venture partner: Familiarity with your firm’s major business String local workforce Values its customers Future expansion possibilities Strong local market for partner’s own products Good Profit potential Sound financial standing Global business environments Legal and poliical systems Trade agreements and trade barriers Regional economic alliances Legal and political systems Differing laws and practices regards Business ownership Negotiation and implementation of contracts Foreign currency exchange Protection of intellectual property rights Counterfeit merchandise Political risk Potential loss in value of foreign investment due to instability and political changes in the host country Political risk analysis (expertise/experience) Forecast political disruptions that threaten the value of a foreign investment Changes in the rules of the game Brexit US Trade Wars-mexico-China Other examples Bolivia, Venezuela, China De-globalization The process of weakening interdependence among nations Trade Agreements and trade Barriers World trade organization Most favourd nation status Tariffs Nontariss barriers (quotes, restrictions, etc.) Protectionism Regional Economic Alliances USMCA (replacment for the NAFTA-North American Free trade Agreement) EU- European Union APEC- Aisa Pacific Economic Copperation ASEAN - Association of Southeast Asian Nationas SADC - Southern Africa Development Community MERCOSUR- Chapter 5- Global Management and Cultural Diversity (part 2) Review Types of global business Global corporation MNE (multinational enterprise) or MNC (multinational corporation) with extensive business operations in more than one foreign country Transnational corporation A global corporation that operates worldwide on borderless basis Some host country complaints about MNCs Host Country companits about MNCs: Excessive profits Interference with local government Domination of local economy Interference with local government Hiring the best local talent Limited technology transfer Disrespect for local customers Examples - War in Ukraine Disruption in global -value chains and increased pressure and interference of MNCs with local government Fertilizer imports in Brazil (one of the major producers of agricultural commodities) We must consider the triple bottom line and the impact in society, the environment and the economy $2.5 billion invest in potash mine in Brazill What about Globalization gap Large multinationals adn industrilizednaitons gaining disporoportinonally form globalization Globalization gap: Large multinational and industrialized nations gaining disproportionally from Globalization Some MNC complaints about host countries MNC Complaints about host countries: Profiit limitations Laws and regulations Overpirce resources Exploitative rules Foreign exchange restriction Failure to uphold contracts Mutual benefits for host countries and multinational companies Mutual benefits for host country and global corporation of MNC: Shared growth opportunities Shared income opportunities Shared learning opportunities Share development opportunities Develop projects together What are some of the ethical challenges for global business Ethincal challenges for global business Child labour Employmnet of children for worl otherwise done by adults Sweatshops Employment of workers at very low wages for long hours in poor working conditions Ex: Nike bad labour prices Unsafe working conditions Corruption Illegal practices that further one’s business interests Corrupiotn of froeign public officials Act makes it illegal for Candain firms and their representatives to engage in corrupt practices overseas Bribes to foreign officials Excessive commissions Non-monetary gifts Sweatshops Conflict materials What is culture Culture : The shared set of beliefs, values, and patterns of behvaiourr common to a group of people Food preferences Values and traditions Language and beliefs Religion Art music Life style Hofstede defines culture as: “The collectiv programing of teh mind distinguishing the members of one group or category of people from others” What is culture shock Culture Shock: Confusion and discoumfert a person experiences in an unfaamiliar culture Stages to adjusting to a new culture Confusion Small vitorires The honeymoon Irritation and anger Reality Cultural Intelligence The ability to adapt and adjust to new cultures What is Ethnocentrism Tendency to consider one’s own culture as superior others Slinet languages of culture Contect Low context High context Space Proxemics Ex: personal space Time Monochronic Polychronic High and low contexts cultures Edward T.Hall (1959) Def: Part of a discourse that surround a word or passage and can throw on its meaning Low context cultures Emphizes communication via spoken or written words Countries like United States, Canada and Germany High context cultures Rely on nonverbal and situational cues as well as on spoken or written works Thailand Malaysia Time Monochronic cultures People tend to do one thing at a time Canda Polychronic cultures Time is used to accomplish many different things at once Egypt Space Proxemics Study of how people use space to communicate In North American people value “personal space’ Many Latin and Asian cultures expect much less personal space Tight and Loose Cultures Cultural tightness-looseness Tight = Strength of norms that govern social behvaviour Japan, Korea, Malaysia Loose = tolerance for any deviation from norms Australia, Brazil, Hungary Values and national cultures (Hofstede) Power distance Uncertainty avoidance Individalism-collectivism Masculinity-femininty Time Orientation Indulgence vs. Restraint Comparative management How management pratices systematically differ among countries and /or cultures Intercultural competencies Skills and personal characteristics that help us be successful in cross cultural situations Global Managers (know how to adapt) Need to successfully apply management functions across interantional boundaries Global Learning goals Not universal Engage critical thinking Look everywhere for new management ideas Always consider culture

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