Presentation on theme: "International Competitiveness, Productivity, and Quality"— Presentation transcript:
1 International Competitiveness, Productivity, and Quality Chapter 3International Competitiveness, Productivity, and Quality
2 BRAINSTORMWhy 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 productsBetter pricingHigher qualityBetter serviceUniqueness or profit
6 Gross Domestic Product (GDP) The total value of all goods and services produced in a country during a specific periodIncludes items produced by foreign-owned companiesGDP per capita = GDP / total population
7 Canada and the GDP Canada is lower than US/ Europe, because: Manufacturing sector is behindLack investment in R&DSlower to adopt new techDepend 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 waysForm 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 industryAbsolute Advantage - a country that can produce a good cheaper will compete most effectively, e.g. Taiwan
12 Factors Affecting Canada’s Competitiveness Abundance of Natural ResourcesOilGasForest productsMineralsWaterProximity to USAOpen borders, makes for easy and productive trade
13 Factors Affecting Canada’s Competitiveness Strength of Currency and Exchange RateCurrency traditionally lower vs. USALeads to increased foreign investment and number of foreign exportsA negative is that we pay more to import machinery, components and new technology into the country
14 Factors Affecting Canada’s Competitiveness InfrastructureCanada has strong transportation and communication systems that support growthAllows easier access to products, and ability to communicate with customers / suppliers worldwide
15 Factors Affecting Canada’s Competitiveness Research and DevelopmentCanada’s R&D inconsistentTelecommunication and information technology are very strongMany manufactured goods aren’t produced within Canada
16 Factors Affecting Canada’s Competitiveness Workforce CharacteristicsLevel of education and amount of training in the workforce are major factorsHave a high level of literacy, and well -educated workforceSocietal CharacteristicsQuality of workLevel of health careDiverse population
17 Factors Affecting Canada’s Competitiveness EntrepreneurshipIngenuity and risk-taking encouraged in Canadian businessResults in a more attractive and competitive environmentGovernment InvolvementCountry’s taxes (GST/ PST) affect negativelyFree trade agreements and willingness to expand trade partnerships are positivesCanada-QUEBEC = Unstable