To what extent and in what ways is Fitzgerald purely critical of Gatsby’s dreams?

One of the main themes of ‘The Great Gatsby' is that of dreams, none of which is more noticeable than Gatsby's own dream of five years in his pursuit of Daisy. What is less obvious is how Fitzgerald wants us to react to these dreams, and whether he is being purely critical of them or whether he in fact does also reveal some good in them. In this essay I aim to show that although in a lot of ways Fitzgerald is critical of Gatsby's dreams, for example by ensuring that Daisy can never live up to the vision of herself which Gatsby has created, he is not entirely disapproving and in several cases even goes as far as to suggest that dreaming is what makes us human. One way in which we may be unsure about Fitzgerald's presentation of Gatsby's dreams is whether they are meant to appear romantic or slightly pathetic. At face value it can seem to be extremely romantic that Gatsby has waited these five years and remained so loyal to Daisy, and I think that it this way Fitzgerald wants us to be on Gatsby's side. Gatsby himself is portrayed as being a very romantic character and this can be seen in his speech when he talks about the past, for example telling Nick that â€Å"His heart beat faster as Daisy's white face came up to his own. He knew that when he kissed this girl, and forever wed his unutterable visions to her perishable breath, his mind would never romp again like the mind of God†. Fitzgerald clearly is making Gatsby appear to be very wistful and dreamlike, and also is making us more sympathetic to him by making his affair with Daisy and his dreams appear to be very romantic. This would obviously cause the reader to sympathise more with Gatsby later in the book when everything falls apart, and I think that it is clearly true that Gatsby believes that his love of Daisy is very perfect and beautiful. However, this quotation could also be read that Gatsby is going too over the top and is trapped in the past by his dreams. Another good place to see this occurring is when Nick warns Gatsby that he cannot recreate the past and Gatsby replies with â€Å"‘Can't repeat the past? Why of course you can! ‘†. This seems like a very irrational thing for Gatsby to say and it begins us questioning what he really wants from his dreams, whether it is Daisy or just to have the past back as it was. Fitzgerald may be doing this to show Gatsby as a man who is just clutching at a past he no longer has and this may make him appear slightly pathetic. The exclamation mark gives him a sense of panic and questioning makes him appear to be almost incredulous to any other way of seeing the situation, which I think is more critical of Gatsby's dreams as they have blinded him to reality. Overall however, when it comes to romanticism or a slightly pathetic appearance, Fitzgerald remains quite ambiguous and leaves it more up to the reader to reach a decision by themselves. , Whichever way it is viewed however, I think in both situations we still have sympathy for Gatsby when his reality doesn't quite live up to the vision. When Fitzgerald comments that â€Å"no amount of fire or freshness can challenge what a man can store up in his ghostly heart†, I think that he is making the quite depressing point here that dreams will always disappoint in the end because reality can never live up to what you can dream of. This is quite a negative view of the outcome of dreams but is perhaps not entirely critical of the idea of having dreams and something to strive for in the first place. Although it may appear that Fitzgerald is condemning dreaming, I actually believe that in this case he may be more positive about it than it seems at first. The character of Gatsby is portrayed as a dreamer, and these aims and human feelings which he possesses ensure that he is much more of an attractive character than for example, Jordan, who has no such dreams or ambitions for the future and is often associated with words such as â€Å"lazy† and â€Å"cool†. This makes her seem a lot less human than Gatsby and we empathise with him far more, which I think Fitzgerald wants us to do. This suggests that Fitzgerald is supportive of ‘the dreamer' and tells us that he is not opposed to the idea of dreams in general. In fact he associates the illusion with the phrase â€Å"colossal vitality† which again evokes the idea that dreams are linked with the essence of being human and that Fitzgerald views Gatsby's dreams with something other than pure criticism. One of the main criticisms which Fitzgerald does have of Gatsby's dreams is the materialism inherent with them. To gain Daisy's affections, Gatsby accumulates extortionate wealth and belongings to attract her, and Daisy herself represents something of the materialistic upper class which Gatsby strives to become a part of. This is very concisely put when Gatsby says of Daisy â€Å"her voice is full of money†. Daisy's voice has particular prominence as a motif throughout the book but at this point it is almost a leit motif as it gains meaning. All we can judge Daisy by is her voice, we never know her thoughts or what she is really thinking as what she says is usually quite empty. By saying that her voice is full of money, Gatsby is pinpointing that superficial charm which she has and perhaps even that in being entranced by her voice he has actually fallen for her wealth. This is an extremely critical way of looking at Gatsby's feelings and we probably don't want to believe it of him, but I think we can see it very clearly in Daisy, especially when she sees his Gatsby's house for the first time. In her exclamation of â€Å"that huge place there? † and her reaction to the extravagant wardrobe, we can see that Fitzgerald is showing Daisy as well as Gatsby to be very focussed on the material and the possessions. I think that this is a point Fitzgerald wants to make on the subject of ‘The American Dream', of which Gatsby's own dream is quite symbolic. As Americans, the characters would have been brought up to believe that they could strive to achieve anything and, in short, that nothing was out of their reach. Fitzgerald is not only questioning the belief in this, but also the means of getting to it and is making a point about how society has taken this dream to be something materialistic and to do with what you can own, rather than more spiritual or meaningful dreams. In respects to materialism I think that Fitzgerald is almost purely critical of Gatsby, as what he appears to be searching for is not just Daisy but the entire social and economical class which she represents. Another interesting way in which Fitzgerald portrays Gatsby's dreams is by making Daisy seem quite an unworthy person to long for. Although, as said in the previous paragraph, she is superficially very beautiful and rich, there appears to be very little under the surface and she tends to talk in quite empty and fantastical phrases such as â€Å"I'd like to just get one of those pink clouds and put you in it and push you around. † In that case Fitzgerald's alliteration of ‘pink', ‘put' and ‘push', as well as the polysyndeton, make her phrasing seem childish and simple – not really that of someone who could be relied on for a long lasting relationship. In some ways we may think that Fitzgerald is criticising Gatsby's dreams at this point, after all it seems worthless that he would have spent all this time loving someone who is in fact not worth it at all. This is incredibly clear to us after we see Daisy's awful behaviour after the accident when she drives away without stopping, and in a way we can see her treatment of Gatsby as quite similar to this, driving along with him, leaving destruction in her wake and escaping away as fast as she can. In this way Fitzgerald is being very critical and it could seem as if his message is that no matter how much you love someone and dream about them, they could just as easily let you down and run away. I think that there is also a slight positive side to Fitzgerald's choice of making Daisy an unworthy dream, as it shows that everybody can be loved by someone, however this is not very strong as Gatsby does not love Daisy with her faults, and rather it seems that he is just immune to seeing her flaws. Fitzgerald in fact, is probably somewhere in between these views; he is not directly attacking dreams or even Gatsby's dreams, but he is more in this case attacking Daisy's character. Although it may be a large lack of judgement skills on Gatsby's side, we cannot blame him entirely and again we still feel sorry for him when Daisy does eventually let him down. Overall I think that it is clear that there is a strong sense of ambiguity when it comes to Fitzgerald's attitude to Gatsby's dreams. However, I feel that the main point he wishes to make is that there is nothing wrong with dreaming, you just have to be careful when choosing your dreams that what you are longing for is actually worthwhile and won't end up hurting you more than it can make you happy. In Gatsby's case his aim appears to be more to make us feel sorry that he was so misguided in his choice of dream, rather than to berate him for dreaming at all.

Vestas in Russia

Vestas in Russia Introduction For my exam project in International Business Environment I have chosen to write about the Danish cooperate Vestas Wind Systems A/S (referred to as Vestas throughout the paper). Vestas is the world’s largest producer of wind turbines and in addition to this it is also the leading company when it comes to green technology regarding wind energy . Vestas not only serves the Danish domestic market, but the company is also present on several foreign markets in other parts of Europe, Africa, Asia, Australia and North and South America. With over 22. 00 employees spread over 35 countries Vestas is categorized as being a multinational cooperation. As for the market of entry I have chosen The Russian Federation (referred to as Russia throughout the paper). Vestas has not yet entered the Russian market so my exam project will be a hypothetical one. One could question why a global actor like Vestas not already has entered a market with so big opportunities a s Russia, but along with visions for great profit comes the reality of great risks and challenges as well. Russia is a vast market for windmills taking the size of the country and the climate debate into perspective.The country is the fourth largest consumer of electricity in the world , but lack of technology hinder Russia to produce it in a climate friendly way. The relevance of a successor to the Kyoto Protocol is at its highest and Russia has expressed great will to find sustainable solutions for its large electricity consumption. Companies capable of exploiting such market are in position for massive gains. This is however easier said than done. Denmark and Russia differ on several aspects of their countries’ structures and Danish companies planning on doing business in Russia hence carefully have to consider these differences.In this paper I will first describe and motivate the entry strategy of Vestas by using John Dunning’s OLI-framework . In this context I wil l argue why more advanced forms of FDI (Foreign Direct Investment) are appropriate for Vestas when entering Russia. Furthermore I will analyze the differences between Vestas’ home market conditions in Denmark, and the conditions of the target market, Russia, regarding adjustments in the marketing mix. To illuminate this section I will use E. Jerome McCarthy’s principle of the four P’s .Lastly I will summarize the above mentioned and discuss the best internationalization strategy for Vestas. Vestas’ competitiveness In order to describe and motivate the entry strategy of Vestas I will outline the advantages based on John H. Dunning’s OLI-framework. Although Vestas already has expanded into many different countries with regards to different culture, political systems and business systems it is not always suitable to use the same entry strategy although the firm is the same in every case. O – Ownership advantage: Vestas’ competitive advan tageThe O in Dunning’s OLI-framework of specific advantages deals with the Ownership advantage. To expand into new markets Vestas has to be in possession of something that gives the company an advantage compared to its competitors. Vestas has a clear ownership advantage first and foremost in form of its technology and know-how. Denmark has exploited wind energy since 1850s with the purpose of making agriculture more efficient. In the beginning of the 1970s the oil crisis influenced Denmark as well, and to avoid another economic breakdown the Danish government searched for an alternative energy industry.Vestas had already done R&D (Research and development) and tried out the construction of windmills since 1971. However they first entered the market in 1979 with a licensed windmill. In the development of the required technology, subsidy from the government and research on RISO (The National Laboratory for Sustainable Energy) has had a vast significance for Vestas, enabling it to play the leading role it does today. Besides the support from the government, Denmark has a highly skilled labor force, which of course also adds to Vests’ ownership advantage.Nevertheless as Lars Andersen (Managing Director of Vestas’ Sales) mentions, it is not only the technology and the skilled employees that give Vestas an ownership advantage: â€Å"However, it also has to do with our ability to deliver on time, the fact that things work from day one, and, in particular, the fact that we fulfill customers’ expectations for a good, reliable return on their investment. In other words, we are not simply selling a wind turbine†¦Ã¢â‚¬  Vestas does not only manufacture and sell the wind turbines, it also provides installation and subsequent after-sales-service, which not many Russian competitors can match.Vestas is, in addition to the above mentioned, a multinational company with more than 30 years of experience and is therefore in a greater position tha n later emerged firms. Vestas is on top of this a world-known and respected brand with focus on quality and is represented in 35 countries spread out all over the world. The company has the largest market share, 24,8% , of the global market, which again places Vestas in a favorable situation when it comes to taking advantage of for instance the experience curve. L – Location advantageThe L in Dunning’s OLI-framework deals with the location advantage. Saying there should be an advantage for Vestas for doing business in Russia as a location for export or more advanced forms of FDI. Russia is geographically an enormous country (covers over 17 million square miles) and includes areas with a very low population density. These areas have great potential for windmill parks and the coastal areas of the Pacific and Arctic Oceans, the vast steppes and the mountains are the areas of highest potential.On the other hand it would also be favorable to place the wind energy system in regions where there is an existing power infrastructure and major industrial consumers. Areas, which fulfill these requirements, are the steppes along the Volga River, the northern Caucasus Mountains and various locations in Siberia including the Chukotka Peninsula in the Magadan region . Chukotka Peninsula is especially to prefer, because of its already existing hydropower stations, which could be used to compensate for the possible intermittent wind power.Another location advantage for Vestas is the fact that the Russian population is the fourth largest consumer of electricity in the world. Hence there is a demand for Vestas’ products and in particular when taking the Russian will to reduce greenhouse emission into consideration. Russia is willing to play an active role regarding the improvement of the global heating problem. The country has already reached its commitment stated in the Kyoto-protocol, but the Russian president Dmitri Medvedev declares that Russia â€Å"wou ld try to reduce greenhouse emissions by 25% by 2020. † The quotation signals a will from the government o find more sustainable solutions for production in Russia, and because Vestas does â€Å"business to business† and â€Å"business to government† commerce, it is of great importance with prospect for government interest and support. In this setting it is worth mentioning that The Ministry of The Russian Federation has published â€Å"The 2020 Energy Strategy†, which describes how to reach the new goal by prioritizing, among other things, ecological energy security through energy policy. In addition to the above-mentioned advantages of Russia as a location for Vestas’ expansion come the possibilities of reducing the overall production costs.As it is with most emerging markets, like Russia, wages are lower than in more developed markets like Denmark. Hence by moving production to Russia Vestas would be able to compete on both quality and price, alt hough their main focus most likely would be on quality . The location advantage is even greater when taking into consideration that there are no real national or international competitive competitors settled in the market yet, hence there is a possibility of a first mover advantage for Vestas as well.Notable is nevertheless also the risk for a first-mover disadvantage in terms of costs and risks when preparing the market for the ‘new’ product. I – Internationalization advantage If Vestas expanded into Russia it would strengthen its position of being â€Å"No. 1 in Modern Energy†, which was Vestas’ slogan before the recent switch to: †Wind. It means the world to us†. Furthermore if Vestas gained the first mover advantage it would give the company control over one of the worlds biggest markets. The internationalization advantage is gained in form of a proper entry mode.The chosen entry mode is of great advantage if it is selected in accord ance to Vestas’ now described ownership advantage and Russia’s location advantages. Vestas’ main ownership advantage is their know-how and technology while the location advantage of Russia primarily are the huge market possibilities and the government’s positive attitude towards renewable energy sources. What remains is, which type of entry mode that exploits both Vestas’ ownership advantage and Russia’s location advantage?Would licensing or exporting be the best-suited entry mode or should Vestas take greater risks and do more advanced FDI? Vestas wants to keep their know-how, but by pursuing a licensing entry mode, spillovers will occur. Vestas would have little control over production, giving possibilities for competitors to emerge and quickly become as efficient as Vestas. Exporting is neither a favorable entry for Vestas. The transportation costs are extremely high, when it comes to the final products. Each piece of the windmill weights approximately 250 tons and thus not suited for export.Other obstacles for the export as an entry mode are the protectionist policies and Russian trade barriers as for instance high tariffs. Vestas would have to pay up to 20% tariff + an additional charge (Value Added Tax) of another 18%, making a total of 38% for exporting its products into Russia. Russia ranks 162 out of 183 countries on the list of ease to do cross border trading with. To compare, Denmark ranks 6 which means that the products produced expensively in Denmark becomes more expensive by being exported to Russia.This situation will of course change if Russia gets its membership in the WTO, but this is not yet achieved. To sum up Vestas needs to move in with plants in Russia and with more advanced FDI to protect its know-how asset and to stay competitive. There are two options for this being either a joint venture or a wholly owned subsidiary. The most obvious solution would be the wholly owned subsidiary, where Vestas could protect its know-how by owning 100 % of the stocks. On the other hand there is a time perspective to consider as well.Siemens, one of Vestas German competitors, have recently announced plans on moving into the Russian market on a large scale . Setting up a wholly owned subsidiary as a green field venture takes a lot of time and the alternative of an acquisition is not an option since Vestas has core values and does not want to take over existing operating routines and enterprise culture. Another aspect, which is important to these considerations, is the fact that corruption and bureaucracy, which makes connections and personal relations very important for success, mark Russian business.Setting up a joint venture with a local firm solves this problem for Vestas, since Vestas would benefit from the partner’s country specific knowledge of culture, language, political systems, business systems and local connections. A joint venture is at the same time a less risky (capital vise) and less time-demanding entry mode, than a wholly owned entry mode, which Vestas needs to take into considerations in order to prevent falling behind Siemens. The major disadvantage of choosing a joint venture is of course the risk of spillover, eading to future competitors. On the other hand it is possible to construct the joint venture to minimize this risk. Vestas needs to engage in a joint venture where it owns the majority of the cooperation and thus is able to remain control. One might argue that it would be difficult to find a company, which would accept to own minority of the joint venture, but taken the undeveloped market into consideration, it should not be a huge problem. There are only a few local firms in the windmill industry in Russia.All of these would most likely be interested in boosting their profit (value creation) and it is not an unattractive offer to join the world leading windmill cooperate in a first mover attempt with prospect of a significant future market share in the Russian market. The joint venture and expansion of Vestas would also have to be on a large scale to be able to capture demand, establish a strong brand name and realize economies of scale. This would no matter what be an ideal opportunity for any local producer in Russia, although they would have to accept Vestas owning the majority of the joint venture.Differences and adjustments There are several aspects where the Russian market conditions differ from the Danish market conditions. These are necessary to look at in order to outline the needed adjustments for Vestas’ marketing mix. Differences in market conditions When comparing Russia and Denmark regarding the ease to do business in, it is very clear that there is a vast gap between the two. According to a survey by The World Bank, Denmark ranks 6 whereas Russia ranks 120 out of 183 countries (1 being the easiest country to do business in).I could therefore point at several diverging market conditions, b ut because of limitations of this paper I have chosen to focus on the following four: Infrastructure, climate, GDP per capita and the level of corruption. One might argue that ‘climate’ is not of great importance when speaking of market conditions, but in my opinion it is a very significance factor in this case concerning the marketing mix, which I will elaborate on in the following section. Infrastructure is important for Vestas when it comes to distribution of the company’s products.When looking at infrastructure in Russia and Denmark the most noteworthy factor is distances and terrain. Russia is the largest country in the world covering 11 time zones and it does not entail deep analysis to conclude that it requires great coordinated logistic to create a well functional infrastructure. This has for several of reasons not yet succeeded for Russia and the country’s infrastructure is hence very fragmented. An uneven terrain with low population density and n ature impediments as rivers and mountains has hindered buildings of proper roads and connections, which have a great influence on Vestas’ ease of doing business.Because of the enormous extent of Russia, the climate varies a lot from the coasts to the mid-country and from the west (Europe side) to the east (Asian side). The temperature fluctuates between the extremes of -65  °C in the winters and +40 °C in the summers. The wind is an important factor to look at in this case as well, because Russia possesses areas with all degrees (categorized as: Low, medium and high) of wind power. The climate differences is thus of great importance regarding Vestas’ product differentiation. Moving focus to the more economic orientated difference in market conditions is the GDP per capita (PPP).Russia’s GDP per capita is low compared to Denmark’s. According to the ranking done by International Monetary Fond, Russia ranks 51 in contrast to Denmark’s ranking as 1 7th . This means that Russian consumers, including the government and large enterprises, have less purchasing power compared to the Danish consumers. Little purchasing power could be an obstacle for Vestas. If consumers don’t have much money to spend, they would most likely not have the mental surplus to think of the environmental dimension by burning fossil fuels.If generating electricity the cheapest and easiest means exploiting fossil fuels, this is what they will do. However higher purchasing power (higher GDP per capita) results in the means to be able to prioritize such things as future global environment. Looking at the energy produced in Russia, over 60% of the electricity generated is based on gas- and coal power whereas less than 1% of the electricity generated is based on renewable energy production . In contrast stands Denmark, where wind power alone in 2008 generated 18,9% of the Danish electricity demand .The growth in GDP per capita in Russia was before the eco nomic crisis, around 7-8% . This is promising for Vestas as a continuous high growth in GDP per capita means a more developed economy, higher purchasing power and therefore increased interest in products like the ones Vestas offers. The fourth difference I have chosen to outline is the high level of corruption in Russia. Russia ranks number 146, whereas Denmark ranks number 2 (1 being the less corrupt) in the Corruption Perceptions Index (2009) made by Transparency International.Vestas has no power to end corruption by itself, so instead it should focus on how to deal with it in business situations. Adjustments in marketing mix: The four P’s I will use E. Jerome McCarthy’s principle of the four P’s: Place, Product, Price and Promotion to analyze the needed adjustments for Vestas’ marketing mix. The four differences (infrastructure, climate, energy production and level of corruption) described in the previous section are all differences that affect these a djustments. The †p† concerning the place (distribution) deals with how to get the product to the consumer.It would be obvious to discuss adjustments to retail concentration, channel length, channel exclusivity and channel quality, but selling Vestas’ products is not like selling jeans or other regular consumer goods. There is no distribution channel, or at least it is very short, because Vestas sells directly to the customer, being government or large enterprises. However the undeveloped infrastructure, as outlined as a big difference between the Danish market conditions and the Russian market conditions, is of great importance for Vestas’ delivery to its customers.Vestas’ products require stable roads (due to heavy weight and size) and connections to the best set-up areas. The infrastructure is best around Moscow and St. Petersburg, due to big business, but this is not necessarily the best location for Vestas’ production. As mentioned before the best set-up areas are the vast steppes along the Volga River, the Caucasus Mountains and locations in Siberia. In Denmark Vestas can easily get around to all parts of the country, but Russia’s huge distances and the uneven terrain in many areas do acquire adjustments.Vestas carefully have to reconsider where to place the facilities of production to minimize transportation costs, and not to forget, maximize availability. This might require compromises in form of set-ups in optimal and less optimal wind areas. To do this Vestas has to deliver wind turbines that also are able to exploit the low winds and Vestas thus has to adjust its products to the Russian climate conditions. Other adjustments are necessary for the turbines to manage the before mentioned freezing winters with temperatures down to -65  °C and the hot summers with temperatures up to +40 °C.The turbines should be able to function all year round to be attractive to customers. Vestas has to differentiate the turbines to match these standards compared to the standards in Denmark, where weather conditions don’t differ as much. In other words, Vestas’ product differentiation is necessary to encounter pressure for local responsiveness and thus reach its customers. The customer segment that Vestas tries to reach is a narrow segment consisting of the government and maybe a few other large enterprises, which would be interested in promoting a green profile.The government and the large businesses would, as most customers, be concerned about price. To match Russia’s rank regarding the low GDP per capita, Vestas would have to make an adjustment in form of lower prices. Price is however not the main focus for Vestas . Quality and safety is their top priority, but of course they would be able to take advantage of the lower labor costs in Russia and thus lower the overall production costs. Vestas could however use strategic pricing in form of experience curve pricing to gain ma rket share and relations to the large customers before competitors emerge.This could be rewarding because of the promising growth in Russia’s GDP per capita, which presents better future market conditions for Vestas’ products. Vestas should at the same time stress that setting up windmills is an investment that might require lots of capital as a starting point, but in the long-term perspective it would be worth it. Today Russia is self-sufficient in terms of energy . However the supply of fossil fuels is diminishing and the demand for it is increasing. Investing in wind power would be a possible way for Russia to stay self-sufficient in the future.Left remains the question of how to communicate all this to Vestas’ customers? When choosing a promotion strategy Vestas has to adjust its approach to the above described high level of corruption. One way of doing this is by having the right connections; knowing the right people. As previous mentioned I would suggest V estas to pursue an entry mode of a joint venture and thereby gain the advantage of local relationships, which could help Vestas to get around the bureaucracy. On the other hand it is of paramount importance that Vestas ‘stay clean’.If Vestas in any way gets associated with any form for corruption, it will have tremendous consequences not only for the domestic market, but also for the global market that Vestas operates in. In accordance to the entry mode I would suggest Vestas to practice a push strategy. It would be a waste of resources to communicate through mass media to vast private consumer segments, to which Vestas’ products have no interest. Vestas’ communication should be directly orientated at the small customer segment, previous outlined.Personal selling, exploiting the local partner’s ability to speak the local language, perhaps supported by additional informative products to be handed out and an enlightening webpage is the best way for Ve stas to reach its potential customers. Vestas’ internationalization strategy In the last part of this paper I will sum up and describe the best internationalization strategy for Vestas when entering the Russian market. Throughout the paper I have concluded that now is a good time for Vestas to enter the Russian market, because of prospects for government interest and support and no real competitors settled in the market yet.Hence Vestas has an opportunity for a first-mover advantage, but only if they enter the market on a large scale. Entering on a large scale is associated with greater risks and costs, but taken the growth in GDP per capita and the decreasing amount of fossil fuels into considerations, it is most likely that Vestas in the long-term perspective will secure massive gains from having established the contacts and its own brand in an early phase.I have already argued that I find a joint venture the most appropriate form of entry mode for Vestas. Forming a joint v enture with the right partner, a partner that has agreed to Vestas’ way of doing business e. g. no corruption, is the best way to remain in control, but still benefit from local knowledge, which is of great value because of the different market conditions compared to Denmark. Due to these different market conditions, Vestas also has to adjust its marketing mix.The most important adjustments would be: Reconsideration of production locations concerning infrastructure impediments, product differentiation and the use of a push communication strategy with help from the chosen partner’s local advantages. There is no doubt about the difficulties a global actor faces. A company like Vestas carefully needs to consider every aspect of a business opportunity to prepare for an expansion into a new market.Vestas operates all over the world where it has to respond to pressures for local responsiveness and pressures for cost reductions. There is a pressure for local responsiveness in Russia due to the geography and the political system. The question is, if this pressure is low or high? I would categorize it as being in between. The pressure is not low since the expansion requires considerable adjustments in the marketing mix, but the pressure is on the other hand neither as high as pressure for local responsiveness for e. g. lothes or cars. Concerning the pressure for cost reduction it is necessary to take a look at Vestas competitors in the Russian market. At the time being, there are not many, but as mentioned before Siemens is planning on moving in. In addition to this, many Asian competitors have emerged in China as well and might constitute future competition. I would therefore say that pressure for cost reduction in Russia at the time being is low, but in the near future this pressure will definitely increase due to the above explained.Vestas could enter with a location strategy or an international strategy, in accordance to the low pressure for local res ponsiveness, but if the company wants to prepare itself to face upcoming aggressive competitors it might be strategic wise to enter with a transnational strategy already at this point. Pursuing such strategy will as well benefit the information flow between Vestas subsidiaries and between the subsidiaries and the home country, which is necessary for sharing one of Vestas’ core competences: know-how.If Vestas not only is able to take advantage of the outlined possibilities but at the same time adjust and respond to the described impediments, it has great opportunities to grasp large profits and at the same time remain competitive in perspective of the Russian market as well as the global market. References The paper is based on classes in International Business Environment plus the beneath listed Book: Hill Charles WL, International Business: Competing in the Global Marketplace, 8th edition

Political Risk International Business

POLITICAL RISK IN INTERNATIONAL BUSINESS The term business normally refers to the act of doing any transactions that ends up in earning or losing money. The act that is ending up in financial implications is called business. This business can be considered as a result of collective commercial transactions of all types involving government, private, corporate, individual or a group of individual, and so on.Anyone involve in the business usually undertakes such operations only for the purpose of making profit, and only in the case of government involved business, there will be some other reason than profit making which could be political, economical, etc. International business is recognized and / or defined as the business that is done across two or more country borders. International business involves selling, buying, making investment, transporting goods, logistical activities, etc between two or more countries.The companies that are doing business worldwide are called multinational companies (MNCs). These companies are normally formed and incorporated in one country and then create their operations in various countries, and will have access to all the markets wherever they do trading. These companies are having different strategies and different approaches for different country operations due to many factors such as culture, interest, etc of the people in those countries. To mentions some examples, McDonalds, Sony, Shell, General Motors, Toyota, etc.The very basic purpose of doing business is only to make money, predominantly, although there are businesses which are not mean for money or profit. Hence for the international business also, the basic purpose will be only profit making. However, there are some additional purposes for the international business, since the effort involved in the establishing the international business is more and complicated than just doing a domestic business. Some of the purposes of international business are discussed hereunder. New Opportunities: While the corporations are extending their operations to the international market, the opportunities for them to develop their business and increased sales / revenue are more. Since the international business brings new products and new services to the country, there will be a good opportunity for finding new customers, and making a good volume of sales among the customers. Also, based on the geographical conditions, climatic conditions, available resources, etc there will be more opportunities for the MNCs to develop their business in terms of infrastructure, product lines, etc.Low Cost: This is an advantageous purpose for the MNCs to have their operations in various countries. In countries like China, India, the human resources will be available in large number and hence the cost of labour becomes comparatively cheaper with the countries of origin of those MNCs. Hence the companies start their operations in those countries and reduce their cost of production les ser and lesser. Those products that are produced from there can be transferred to the other country’s operations of the same MNC. Hence over all the company’s cost of production is slashed to a very minimum amount.For example, many Sony opened their operations in China, and most of the Sony products available in any of the country come from the manufacturing units of Sony in China. This way Sony capitalizes the international business concept. Resources: Resources are one of the major assets for any organization. Business while going international, get opportunities to improve the standard of the resources, many times at a cheaper cost. While the business is international, the organization will have access to various types of resources from various countries.This is an added advantage to the company in developing their knowledge, and work force. Hence cross country knowledge is acquired by the organization, and hence the knowledge repository of the organization grows an d hence to get more benefit from the resources. Just like the way the international business provides lots of benefits, there are lots of risks associated with the international business, which are discussed hereunder. Strategic Risk: Many of the international companies try to implement many of heir business strategy across all their branches in all the countries; however, due to many changes that exist between the countries wherein the operations are undertaken, many times the strategies will not work. For example, a strategy designed for the summer seasons in one country may not work in another country, since there could be a different season at that time, and vice versa. Hence strategy management is a potential risk in international management. Operation Risk: International business operations are happening across the globe.The practical situation in one country and the situation in another country will never be the same. Mode of transport, maintenance of machinery, supply and de mand of products required for production, logistic and inventory issues, etc will be on a regular basis and will create problem for a smooth production processes. Major cause of this operational risk will be the capital market variances between the countries and assets that are involved in the operational activities. Technological Risk: International business is highly dependent on the technology especially in terms of communication and transaction.There is always a big risk in the security part of the electronic transactions and hence that creates a major risk for the international business. Cost of newer technologies, redundancy of the old technology and the locked cost in such investments, etc are the major risks due to technology. Environmental Risk: While the environment, such as air, pollution, water, etc of the country wherein the operation is happening is affecting the people and creating an environmental issue, which affects the reputation of the corporation functioning the re as well.The corporation also socially becomes responsible for such devastation of the environment. Economic Risk: This is anyway not in the hand of the business. If the country in which the business operation of the MNC is happening is not able to control the economic problems, which will eventually impact the MNC as well. Exchange rate, monitory policy, etc are the cause of such economic risks. Financial Risk: Currency rates and inflation rates are major cause of this type of risks. The financial situation of the country becomes instable, and that hits the organization badly.While the government does not have strict rules in areas such as transferring investment funds to other countries, the economic financial conditions become worse. However, the Political risks in the area of international business are large and are highly considerable more than other risks. Since international business is happening in different countries, the business is facing directions and regulations from various political governments. Any changes that are happening in the political situations will have an impact on the way the business is running the country.The leader of the country or the political person in the country will be responsible for such impact of risk; however, the organization will have a lesser say in such situations. The possibility of international business risks is always high. The very moment the business goes abroad, the government to which the business is subjected to will change. Hence irrespective of the amount of impact, there will be surely impact on the business from the political side. The government issues related to the overall country-wide policies, changes in the higher officials such as ministers, or other such positions will directly impact the business.The impacts of the risks are varied from soft to extreme. Terrorism, war, etc are extreme risks, while change of president or prime minister, or different political parties coming into power, etc is moderate risks. However, it is easy to understand and accept that any of this risk will surely be in existence in any given country and hence that will affect the business organization which is doing an international business in that country. The political risks can be classified into micro risks and macro risks.Micro political risks are very common to the country in which it is happening, and will affect the entire company’s existence in the company or something of that magnitude. For example if there is a political instable relationship between two countries, then there will be a risk of closing down the business of the organizations in one country who base location is the other country. On the other hand macro level political risks are something that is affecting all the international business in host country in which the political changes are happening.For example, if there is a political emergency in the county all the international business would come to cease. Such em ergency may also work against the foreign direct investment from all the countries, which is again nullifying the international business in the host country. For any risks that are faced in the business, multiple solutions are available. In the context of political risks related to international business, the general strategy the MNCs normally follow is to do a political risk analysis on the country in which the MNC is going to start its operation.If the international business is just about making a foreign investment, before the investment is made a good and detailed risk analysis or research is advisable. There are many independent consultants who do such risk analysis and researches on potential countries. Such reports can be purchased by these MNCs or they can form their own team in making such analysis. MNCs can also adopt some risky strategy which has to be calculative.At times, while investing in a country which is proven for political risk, the MNC can see a better and attra ctive return from the investment. Hence the strategy needs amendment based on the negotiation with the host government for further compensations and at the same time providing some reasonable benefits for the country resources, such as man power, and other structural facilities. Such MNCs are establishing their operations in those countries and help the country to develop their economy and increase the standard of living there.Another strategy normally tried by the MNCs are involving into the business in the risk prone countries and also make considerable investments in the political risk insurances. By doing so, the possible losses the MNC may face can be compensated by the insurance, if happen so. However, such investments in the international business are made only when the corporation foresees a good and attractive return from those host countries. Interestingly investment in political insurance may also amount to risks, since the insurance claim may not be obtained as it is pro mised to be.Based on the available option, the recommendation could be to do a good and through research on the political situation of the country wherein the MNC is going to commence its business. While the MNC is hoping to have a wide range of investments in many countries, it is advisable to have a separate department in the company which is looking after such risks, either doing their independent research or having assistance from the well know consultants in the market. Business earns profit in the form of money; however, it also exposed to many risks.There are risks related to the internal environmental factors, as well as external environmental factors. External factors are not in the control of the business organization, and hence handling becomes difficult. When the business goes abroad and become an international business, then the exposure to various external environmental factors increases, while the possible benefits also increases. Political risk is one of the major ri sks associated with international business, which is the main concern of the MNCs going abroad.MNCs are forced to face both micro and macro political risks. However, since the political risks are a well known factor, there are many research conducted across the world about most of the countries. Hence the MNCs are also having sufficient information to take a decision on the available options and plan their strategy towards opening up their business abroad. In many countries, international business works and give and take policy, where the MNC benefited financially while the hose country is benefited in terms of economy, life standards, and knowledge sharing.References * Alan M. Rugman, Simon Collinson. 2008. International Business. London: Prentice Hall * Oded Shenkar, Yadong Luo. 2008. International Business. Chicago: Sage Publicaitons * Daniels, J. , Radebaugh, L. , Sullivan, D. (2007). International Business: environment and operations, 11th edition. Prentice Hall. * Joshi, Rakes h Mohan, (2009) International Business, Oxford University Press * Travis, T. (2007). Doing Business Anywhere: The Essential Guide to Going Global. Hoboken: John Wiley&Sons.

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