Reference no: EM1363928

Please answer this question on an individual basis, and post your answer within the weekly discussion question conference. More and more companies are placing their 'value added' activities in the hands of the international market in hopes of improving their cost structure, expanding 
their markets or meeting competition head-to-head. The success of a Company's international ventures depend upon a receptive business and market environment in the country [ies] they are competing in. As long as these assumptions remain intact, international strategies will be effective. Just to illustrate one: Successful international strategies are dependent upon the continued economic and political stability in the particular country being targeted. I would like you to identify two to three basic assumptions about the business and consumer environment that must remain valid in the future in order for international strategies to thrive. In your selection of assumptions, use the following two criteria:

1) Choose assumptions that absolutely must remain valid. That is, if these assumptions don't hold true, international strategy success is in immediate danger. These kinds of assumptions are referred to as 'load-bearing' assumptions. To use an example from another industry, the U.S. tobacco industry continues their operations based on the assumption that commercial sales of cigarettes will remain a legal transaction. If that assumption were to fail, it would seriously threaten the very existence of at least the domestic tobacco industry. So presuming that cigarette sales remain legal is truly a 'load bearing' assumption.

2) In addition to being 'load bearing,' select the assumptions that might be most vulnerable to environmental changes. These are assumptions that have a reasonably high probability of not holding up [or failing]. Here's an example of a 'vulnerable' assumption: When companies such as WalMart decide to export their 'business model' of everyday low prices and good values to countries all over the world, they are operating under the assumption that the 'business model' will remain intact and valid, regardless of the country market that they enter. However, there is a reasonable chance that the image that caught on so well in the U.S. will not succeed in countries where low prices may be strongly associated with poor quality merchandise. If this is true, WalMart is basing its international expansion on a 'vulnerable' assumption.

To be clear about this, I'm looking for two to three assumptions that have both load-bearing and vulnerability characteristics. I'm not looking for two different set of assumptions. As a final step, I would like you to identify actions that you take to manage the risk associated with these
'load-bearing,' 'vulnerable' assumptions. Some actions may be shaping actions to prevent the assumption from becoming a reality. Other actions may be 'hedging' actions that provide you with a contingency plan in the event that the assumptions do become a reality.