Answered Essay: Scooter Land had been headquartered and doing business solely in the United States for five years

Scooter Land had been headquartered and doing business solely in the United States for five years. They had an excellent reputation for a quality product and demand was at an all-time high. The CEO of the company decided to explore the possibility of expanding into two or three foreign countries. Each foreign facility would include operations, distribution, and sales of the scooters.

The CEO assigned John, the Director of Operations, to be in charge of performing the preliminary work in making the decisions regarding the expansion into other countries. John started by visiting Central America and Africa because of the reported low cost of doing business in these areas. After his visits, however, John rejected these countries because of the dangerous business climates and insufficient disposable income in their marketplaces.

John also performed a detailed analysis of 75 additional countries, hiring an expensive consultant to assist him with the analysis of the extensive amount of information obtained. By the time that John and the consultant finished their analysis, six months had passed and they had spent more than $100,000.

Before completely giving up on the project, the CEO asks you to provide input to John. He feels that the project can be saved if John heads in the right direction. He asks you to first describe five (5) external sources of information that John should have used to collect country information for analysis purposes. Because you oversee operations, he also asks you to identify and discuss three (3) control instruments that the business might use to govern the international operations. This is critical to know if the company moves forward with the expansion.

Scenario Analysis: 1 Page Required Response

Expert Answer


Q1) Below are the five external sources of information that John should have used to collect country information for analysis purposes –

1. Customer information – This includes the data regarding customer preferences, availability of market for the products, purchasing power of customers etc.

2. Business regulations in the country – It is important to understand the buiness landscape and regulations to effectively operate in a country.

3. Availability of skilled resources to handle operations – To handle the operations, it is important to employ skilled resources in various functional areas, technology literacy etc.

4. Country’s economic growth and competitors – John needs to look at the firm’s economic growth and the competitors in scooter business. Depending on whether the market is too crowded or is less crowded, the business and competitor strategy can be designed.

5. Risks involved in doing business – John needs to identify various risks, both internal and external in doing business in a country.

Q2) Below are the three control instruments that the business can use to govern the international operations –

1. Following the law of land on labor rights, regulatory practices etc. – It is important that the firm operates in the perview of the law of the land in which it established its operations to avoid any legal or political issues.

2. Ensuring equal treatment of various subsidiaries across the countries – Firm must provide equal opportunities and facilities for subsidiaries across countries to grow and develop.

3. Business communication – Business communictaion is critical to ensure the businesses comply to thde code of conduct of the firm and successfully operate.

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