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1. Presentation group #1
 Alex Merket
 Sena Sevencan
 Kan Mihail
 Lissette Plaza

2.  The world economy is becoming more global
. Therefore, the nature of international
business is changing in response to it.

3. Globalization.
Shift toward a more
integrated and
interdependent world
economy.
Globalization of
production.
Sourcing of good and
services from
locations around the
globe to take
advantage of national
differences in the cost
and quality of Factor
of production
Globalization of
markets.
Merging of distinct
and separate national
markets into one huge
market place

4. Emergence of Global
Institutions.
 GATT (General Agreement
on Tarrifs and Trade)
 WTO
 IMF (International
Monetary Fund)
 World Bank
 United Nations
• International Justice
• Alien Tort Claims Act
(ATCA)
• Universal Jurisdiction
• US, UN and International
Law

5. Why Is Law Globalized?
It allows companies to focus on:
 Core Competence
 Build Expertise
 Control Expenses
 Eliminate Waste
 Directly Provide Value To Clients Or Customers.

7. What is driving Globalization?
 Declining barriers to the free flow of goods, services, and capital
 average tariffs are now at just 4%
 more favorable environment for FDI
global stock of FDI was $15.5 trillion in 2009
 facilitates global production
 Technological change
 microprocessors and telecommunications
 the Internet and World Wide Web
 transportation technology

8. What does Globalization mean for firms?
 Lower barriers to trade and investment mean firms can
 view the world, rather than a single country, as their
market
 base production in the optimal location for that activity
 But, firms may also find their home markets under
attack by foreign firms

9. Declining trade and investment barriers
Average Tariff Rates on Manufactured Products as Percent of Value

10. What does globalization mean for firms?
 Technological change means
 lower transportation costs
 help create global markets and allow firms to disperse production
to economical, geographically separate locations
 low cost information processing and
communication
 firms can create and manage globally dispersed production
 low cost global communications networks
 help create an electronic global marketplace
 global communication networks and global
media
 create a worldwide culture and a global consumer product market

11. The changing Demographics
of The Global Economy
 Four trends are important:
1. The changing world output and world trade picture
2. The changing foreign direct investment picture
3. The changing nature of the multinational enterprise
4. The changing world order

12. How has World Output and
World Trade changed?
 In 1960, the U.S. accounted for over 40% of world
economic activity, but by 2009, the U.S. accounted for
just 24%
 a similar trend occurred in other developed countries
 In contrast, the share of world output accounted for by
developing nations is rising
 expected to account for more than 60% of world economic
activity by 2020

13. The Changing Demographics of World GDP and Trade
How has World Output and
World Trade changed?

14. How has Foreign Direct
Investment changed over time?
 In the 1960s, U.S. firms accounted for about two-thirds
of worldwide FDI flows
 Today, the United States accounts for less than one-fifth of
worldwide FDI flows
 Other developed countries have followed a similar pattern
 In contrast, the share of FDI accounted for by
developing countries has risen
 Developing countries, especially China, have also become
popular destinations for FDI

15. How has Foreign Direct
Investment changed over time?
Percentage Share of Total FDI Stock 1980-2009

16. How has Foreign Direct
Investment changed over time?
FDI Inflows 1988-2008

17. What is a Multinational Enterprise?
 Multinational enterprise (MNE) - any business that has
productive activities in two or more countries
 Since the 1960s
 the number of non-U.S. multinationals has risen
 the number of mini-multinationals has risen

18. The Changing World Order
 Many former Communist nations in Europe and Asia are
now committed to democratic politics and free market
economies
 creates new opportunities for international businesses
 but, there are signs of growing unrest and totalitarian
tendencies in some countries
 China and Latin America are also moving toward greater
free market reforms
 between 1983 and 2010, FDI in China increased from less
than $2 billion to $100 billion annually
 but, China also has many new strong companies that could
threaten Western firms

19. How will The Global Economy
of the 21st Century look?
 The world is moving toward a more global
economic system…
 But globalization is not inevitable
 there are signs of a retreat from liberal
economic ideology in Russia
 Globalization brings risks
 the financial crisis that swept through South
East Asia in the late 1990s
 the recent financial crisis that started in the
U.S. in 2007-2008, and moved around the
world

20. Is the shift toward a more integrated and interdependent global
economy a good thing?

21. Many experts believes
Increased trade and cross-border
investment mean,
-Lower prices for goods and services
-Greater economic
growth
-higher consumer income
-more jobs
Critics worry that will cause
-job losses
-Environmental degradation
-Cultural imperialism of global media

22. What is the concerns of globalization ?
Anti globalization protesters now
turn up at almost every major
meeting of global institution
• 40,000 anti-globalization protesters
took to the street at the WTO
meeting in Seattle in 1999
• Protesters fear that globalization is
forever changing the world in a
negative way

23.  Job loses in industries
 Under attack from foreign competitors
 Cultural imperialism of global media
 Downward pressure on the wage rates of unskilled workers
 Environmental degradation
 Multinational enterprises

24.  Globalization critics argue that falling barriers to trade are
destroying manufacturing jobs in advanced countries
USA, Western Europe
 Allow firms to move manufacturing activities to countries
wage rates are much lower
China,India

25. Globalization critics argue
 Moving production to countries
regulations do not exist
Do not enforced
 Environmental and labor standards are associated
with economic progress

26.  Economic power away from national governments toward
supranational organizations
-WTO, the EU, and the UN
 Supporters of globalization contend
-Power of these organizations is limited to what nation-states
agree to grant,
and that the power of the organizations lies in their ability to get
countries
to agree to follow certain actions

27.  The gap between rich and poor has gotten wider
 Benefits of globalization have not been shared equally
 Limited economic improvement in many countries
 Many of the world’s poorest nations are under totalitarian
regimes
-suffer from endemic corruption,
-have few property rights, are involved in war,
-and are burdened by high debt
 globalization raises stakes of
addressing weaknesses of
capitalist free market system and
of individual societies

28.  Access to new markets
 Access to new products
 Access to new technology
 Better standard of living
 Good quality products
 Keeps a check on inflation
 More employment opportunities
 Increased welfare & prosperity
 Inflow of foreign capital
 Exploitation of domestic labor
 Misuse of host nation’s natural resources
 Loss of cultural values
 Non-remittance of funds broad
 Increase in imports
 Drainage of foreign currency
 Competition from MNC’s (Infant Industry)
 Rising Inequality

29. • An international business is any firm that engages in international trade or
investment An international business is any firm that engages in international
trade or investment
Managing an international business differs from managing a domestic business
because:
• countries differ
• managers face a greater and more complex range of problems
• international companies must work within the limits imposed by governmental
intervention and the global trading system
• international transactions require converting funds and being susceptible to
exchange rate changes

30. Legal Process
Outsourcing (LPO)

31. What is Legal Process
Outsourcing?
When in-country legal organizations outsource legal work from
areas which are expensive to operate in, to those areas where it
is more cost-effective to operate.
Biggest destination right now is India:
- India has many legal workers proficient in Common Law
- India also has the largest amount of low-cost English-speaking
lawyers
- Industry has been growing in recent years as India economy
continues to grow rapidly

32. Benefits of Legal Outsourcing
Cheaper Labor
- Other countries have lower labor
costs ($100-$500 in U.S. vs $20-
$60 in India)
- Allows for the ability to hire more
people
- Minimizes costs, maximizes profits
Greater efficiency
- Tasks can be outsourced to people
who can do the specific jobs with
greater efficiency
- Mass concentration
Superior Expertise
- People are specialized within certain
departments
- Specialized individuals are much more
accurate
- Less mistakes means less costs
Concentration on Core Processes
- Host business can concentrate on the main
process of the business
- With legal services they can focus on
creating a sound legal case vs. spending time
and energy on exhaustive parts
(consolidating info, etc.)
- Can work overnight
- 24/7 work environment with no downtime

33. Costs of Legal Outsourcing
Exposing confidential data
- With outsourcing comes trusting
confidential data with 3rd party
vendors or businesses
- This can be especially risky in legal
cases where information leak scan
completely change the outcome of a
case
Giving up quality control
- Can’t have oversight as easily on
the business,
- Outsourced employees might do
things wrong without host company
noticing
- 3rd party may have incorrect info
Less understanding
- Outsourced employees may have less
understanding of the industry
- May not understand the
intricacies of the host country’s laws
- Language barriers, cultural barriers
Blurring of strategic vision
- May not be as passionate/focused on
the strategy of the firm,
- May not comprehend what exactly
they are trying to achieve (if law is
confusing or messy)

34. Types of Outsourced
Activities
Proof Reading
- Checking for spelling mistakes, grammar, etc.
Document Review
- General review and checking of routine legal documents
- Fact checking papers
- Assuring there aren’t legal loopholes within the writing.
Document Drafting
- Writing documents such as legal agreements
- Creating contracts with clients or vendors
- Sending out letters/emails
Case Research
- Researching items for the legal case itself (time-exhaustive)
Litigation Support
- Calculating economic damages in an accounting manner. Computing the monetary costs of physical
damages or emotional distress to client
Misc.
- Patent drafting
- Legal filings
- Secretarial work
- Administrative work

35. Who Gains, Who Loses
Firms GAIN
- Decrease in costs
- Increase in efficiency
- Increase in accuracy
Employees/ Clients
LOSE
- Jobs get shipped away
- Deflates wages
- Clients information at
higher risk

36. Legal Outsourcing: Good or
Bad?
 I believe legal outsourcing to be a good thing
 Allows firms to decrease costs and increase output
 Legal cases can be solved in a more timely manner
 Allows those with less capital to face those who are extremely
wealthy
 It is arguable that it ships jobs overseas however…

37. Why India?
- Largest source of low-cost
lawyers
- Almost all proficient in Common
Law
- High English literacy
- Indian economy very strong
(avg. growth of 7%)
- One of the fastest growing
service sectors in the world
- Sheer number of people
- Perfect time zone (9-12 hrs.
ahead)
- Friendly relations

38. Thank you!