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International Competitiveness, Productivity, and Quality

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Presentation on theme: "International Competitiveness, Productivity, and Quality"— Presentation transcript:

1 International Competitiveness, Productivity, and Quality
Chapter 3 International Competitiveness, Productivity, and Quality

2 BRAINSTORM Why do countries compete for international businesses to locate in their country? What kinds of economic and social factors would attract international businesses? How does the state of Canadian economy/ Canadian businesses affect international businesses operating in Canada?

3 Establishing a Global Presence
Global Presence - when a country is recognized internationally for its reliability, the fairness and integrity of its business dealings, and the standards of its companies goods and services. Capital - The money or other assets that are available for investment purposes.

4 Establishing a Global Presence
Four questions when developing a Global Presence: Which product will lead the way as the company launches an international business initiative? Which market should be entered first? What is the best way to enter these markets? How rapidly should the company expand internationally?

5 Competitive Advantage
Is achieved when companies and countries outperform their competitors around the world by: Improved or superior products Better pricing Higher quality Better service Uniqueness or profit

6 Gross Domestic Product (GDP)
The total value of all goods and services produced in a country during a specific period Includes items produced by foreign-owned companies GDP per capita = GDP / total population

7 Canada and the GDP Canada is lower than US/ Europe, because:
Manufacturing sector is behind Lack investment in R&D Slower to adopt new tech Depend on service rather than goods

8 Achieving Competitive Advantage
Economic Utility - a product’s ability to satisfy the needs and wants of the customer. Utility can be found in variety of ways Form Utility (when raw materials are converted into finished products) Place Utility (product has most value at home rather than far away (e.g ice rinks)

9 Achieving Competitive Advantage
Opportunity Cost - calculates the benefits of the value of the next best opportunity. E.g. - giving up a job paying $25,000/ year to go back to school for four years. $25000 x 4 = $100000! How long will it take to recoup these funds in the new job? What are the positives / negatives of this scenario

10 Achieving Competitive Advantage
Comparative Advantage - when a company can specialize what it does well at a reasonable cost, e.g. Canada’s fishing industry Absolute Advantage - a country that can produce a good cheaper will compete most effectively, e.g. Taiwan

11 Factors Affecting Canada’s Competitiveness

12 Factors Affecting Canada’s Competitiveness
Abundance of Natural Resources Oil Gas Forest products Minerals Water Proximity to USA Open borders, makes for easy and productive trade

13 Factors Affecting Canada’s Competitiveness
Strength of Currency and Exchange Rate Currency traditionally lower vs. USA Leads to increased foreign investment and number of foreign exports A negative is that we pay more to import machinery, components and new technology into the country

14 Factors Affecting Canada’s Competitiveness
Infrastructure Canada has strong transportation and communication systems that support growth Allows easier access to products, and ability to communicate with customers / suppliers worldwide

15 Factors Affecting Canada’s Competitiveness
Research and Development Canada’s R&D inconsistent Telecommunication and information technology are very strong Many manufactured goods aren’t produced within Canada

16 Factors Affecting Canada’s Competitiveness
Workforce Characteristics Level of education and amount of training in the workforce are major factors Have a high level of literacy, and well -educated workforce Societal Characteristics Quality of work Level of health care Diverse population

17 Factors Affecting Canada’s Competitiveness
Entrepreneurship Ingenuity and risk-taking encouraged in Canadian business Results in a more attractive and competitive environment Government Involvement Country’s taxes (GST/ PST) affect negatively Free trade agreements and willingness to expand trade partnerships are positives Canada-QUEBEC = Unstable

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