Global Business Environment

1
Global Business Environment

• Prasada Reddy
• Centre for Entrepreneurship
• University of Oslo, Norway

2
Economic Liberalization

• Policies governing trade and investments
• International institutional mechanisms (e.g. WTO,
  EU, bilateral agreements)
• Growing intra-industry trade
• Sectoral policies affecting innovation (e.g.
  Intellectual property rights, clinical trials,
  etc.)
• Global harmonization of consumer preferences in
  some industries

3
Technological changes

• Changes in techno-economic paradigm
• Emergence of new science-based pervasive
  technologies
• Even old products incorporate new technologies
• Multi-disciplinary inputs for innovations
• ICT as a driver and facilitator of globalization

4
Global competition

• Oligopolistic competition in major industries
• Emergence of innovative small firms in niche
  areas
• Shorter product life cycles
• Increasing RD costs
• Access to global markets and resources
• New competitors

5
Corporate responses

• Rationalization of corporate structures from
  multinational to international to transnational
  approach
• World/regional product mandates
• Global intra-organizational networks
• Global inter-organizational networks
• University-industry collaboration

6
Implications for innovation 1

• Innovation can be located wherever the resources
  are available
• Centre-for-global innovations for global markets
  centralized in headquarters
• Local-for local innovations for local markets
• Locally-linked innovations in each location for
  global application
• Globally-linked collaboration between different
  local units for global innovations (Barlett and
  Ghoshal, 1991)

7
Implications for innovation 2

• Modularity and divisibility of innovation process
• Specialization within the innovation process
• RD outsourcing
• Emergence of technology markets and research firms

8
Implications for innovation 3

• University spinoffs
• Regional/national government policies
• Cluster development/science parks
• New sources of financing for innovation
• Importance of intellectual property rights