What is internationalization

internationalization

describes the development of an increasing international exchange of goods and services that has taken place since the end of the Second World War. Statistically this development is expressed in the fact that the growth rates of the world trade relations for almost all world regions during this period exceeded the growth rates of the gross national products (GNP). Since the opening of the former Eastern Bloc, this development has accelerated and is increasingly forcing companies to adapt their business activities to the challenges of these changed conditions (multinational companies, global players).
This development goes hand in hand with a considerable increase in the international spatial diversification of production (plant diversification) and the multicultural deployment of personnel (global ressourcing). At the same time, the proportion of service activities is increasing very sharply. The global distribution of the increasing economic activities is not evenly distributed over the geographical area, but is concentrated in regional centers of economic activity (regionalization).

(engl. internationalization) Internationalization characterizes the development of an increasing international exchange of goods and services as well as the dismantling of tariff and non-tariff trade barriers (e.g. import and export quotas), which has taken place since the end of the Second World War. Statistically, this development is expressed in the fact that the growth rates of world trade relations for almost all world regions exceeded the growth rates of gross national products (GNP) during this period. Since the fall of the former Eastern Bloc and the increase in importance of the. Emerging markets (e.g. China) has accelerated this development and is increasingly forcing companies to adapt their business activities (see also r globalization) to the challenges of these changed conditions (multinational companies, global players). This development goes hand in hand with a considerable increase in the international spatial diversification of production (plant diversification) and the multinational deployment of personnel. At the same time, the proportion of service activities is increasing very sharply. The global distribution of the increasing economic activities is not distributed equally over the geographical area, but is concentrated in regional centers of economic activity (regionalization).

The concept of internationalization encompasses a multitude of different phenomena, see above

- cross-border activities abroad (foreign trade)

- certain forms of market entry (market entry strategies), i.e. export, direct investments abroad or licensing abroad as a form of internationalization (internationalization strategies)

- Issues related to the management of foreign subsidiaries (management, intercultural).

With regard to internationalization, function-specific and cross-functional conceptions can be distinguished. Function-specific approaches often reduce internationalization to questions of sales or marketing (international marketing). They are closely linked to the traditional view of internationalization in business administration (international business administration). This view neglects other operational functional areas, for example research and development, financing, etc. It also disregards the fact that internationalization - at least conceptually - encompasses the company as a whole (cf. Perlitz, 2000, p. 9ff.). Perlitz sees not only the function-specific consideration, but also the restriction of the term to the initial start of foreign activities as too narrow. At the same time, it shows that in the following cases of international competition one can also speak of internationalization.

Also: multinationalization. Process of participation of a bank in existing or the establishment of new organizational units of different legal nature for the purpose of providing services abroad. Organizational forms that come into consideration are essentially branches and subsidiaries. In addition to the choice of location, decisions about internationalization in the banking sector also include the question of the organizational structure of the respective foreign engagement. The different forms of attendance available must be subjected to a selection process in order to find the alternative that appears to be the most advantageous for the individual case. Advantage is primarily determined by the type of business being planned and the related business policy objectives. Finally, different forms of market access regulations that restrict the freedom of establishment and possibly the scope of business require special consideration. These legal framework conditions are mostly influenced by reciprocity or non-discrimination relationships. Analogous to the decision-making determinants when choosing a location, the relative advantages of alternative forms of presence are assessed on the basis of certain criteria. In this regard, in particular: the amount and profitability of the investment, the type and scope of business activity, banking supervisory and credit policy conditions, tax aspects, flexibility of business policy and personnel requirements.

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